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CAPITAL EQUIPMENT NEWS
AUGUST 2017
22
AFTERMARKET SUPPORT
W
ith demand slowing, competition intensifying and profit
margins imploding, the capital equipment supply chain is
changing its approach, placing more focus on offering solu-
tions instead of just products. It is evident that selling spare parts and
aftersales services such as conducting repairs; installing upgrades;
reconditioning equipment; carrying out inspections and day-to-day
maintenance; offering technical support, consulting, and training; are
becoming a munificent source of revenues and profits.
In several industries such as commercial vehicles, industrial machinery,
and ‘yellow’ and ‘white’ metal equipment sectors, to mention a few,
suppliers have sold so many units over the years that their aftermarkets
have become up to 10 times larger than their current original equipment
businesses. As a result, OEMs and their dealers realise that ignoring the
promise of aftersales services is imprudent, to say the least.
Investments into local support structures by several OEMs and their
dealers are testimony that services, especially parts and maintenance,
are the future of the industry as end users are also now forced to keep
their current equipment and vehicles longer, which means they also
require added maintenance and service support.
Investments abound
Offering a quality product is one thing, and being able to offer crucial
backup support once it is operational in the field, is quite another.
FROM PRODUCTS
TO SOLUTIONS
This is the golden age of services, and to survive and prosper, the capital equipment supply
chain is transforming into a service-centric sector, moving away from just supplying products
to offering end-to-end solutions. Although companies still push products, there is now a
bigger focus on delivering the value that customers get out of using those products, writes
Munesu Shoko
.
KEY TALKING POINTS
• Equipment suppliers making big investments into
aftermarket structures
• Babcock invested R100 million in an ultramodern
sales, parts and service dealership in Middelburg,
Mpumalanga
• Volvo Group Southern Africa inaugurated an upgraded
R60 million integrated regional parts distribution centre
in Boksburg
• Caterpillar, its independent dealers and the Caterpillar
Foundation to invest more than $1 billion in countries
throughout Africa over five years
• Wirtgen Group invested in excess of R50 million into a
new facility for its Wirtgen South Africa subsidiary in
Pomona, Gauteng
Barloworld Equipment recently
announced an agreement with Caterpillar
to establish a retail parts operation in the
newly-built Caterpillar Parts Distribution
Centre in Kempton Park.