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AI in the Machine Manufacturing: Gearing Up for a Smart Revolution
Discover how artificial intelligence is transforming the machine manufacturing industry. The webinar review shows innovative ways of digital...
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Aftermarket Success: Getting it Right in 2024
As 2024 rapidly approaches, executives are strategically exploring avenues to bolster their revenue streams by strategically diversifying into untapped areas of their business.
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Aftermarket Strategies for Success
International trade conflicts, volatile markets and increased cost pressure require a resilient strategy for growth. Our whitepaper explores common challenges faced by machine manufacturers, potential growth drivers in the aftermarket, and gives a blueprint for aftermarket success strategy. Read more now!
The aftermarket, often referred to as the secondary market, refers to the manufacturing, distribution, and sale of parts, accessories, and products after the original sale of a product. Mostly it is connected to the automotive industry but also spanning across any other industry where spare parts and sales and services after the initial product sale is common, such as e.g. machine manufacturing.
Aftermarket parts encompass a diverse array of components used for the repair, enhancement, and maintenance of machinery or vehicles. This sector includes both essential replacement parts necessary for the operation of a machine and additional accessories designed to boost the performance of these machines.
Aftermarket products are often available through various retailers and brands, offering consumers the flexibility to choose from a variety of options when they need to buy spare parts. This field is crucial for extending the life of vehicles and machines, providing consumers with alternative choices, and allowing for customization beyond what the original manufacturers offer.
The Importance of the Aftermarket in Machine Manufacturing
Machine manufacturers are currently facing significant challenges in a complex and rapidly changing industry. They are dealing with hurdles often out of their influence that threaten their financial stability and growth potential.
But amid these challenges, the aftermarket offers a valuable opportunity. As a high-margin profit center, it can offset declining revenues from new machinery sales and ensure long-term profitability. With more businesses focusing on maintaining and upgrading existing equipment instead of purchasing new machines due to increased cost pressures, machine manufacturers who prioritize expanding their aftermarket business can create a reliable, recurring revenue stream and build strong customer relationships. Industry data shows that the parts department often generates much higher profit margins than initial equipment sales, providing a resilient foundation in an uncertain market.
Current Trends in the Aftermarket Business
There are currently 4 key trends that are shaping the way OEMs in the manufacturing industry can improve revenue in their aftermarket business. Top management in the machine manufacturing industry, whatever the sector, should be aware of the following trends:
Digitalization & AI
The digitalization of operations and implementation of AI is changing how manufacturers operate and engage with customers. Getting on board with modern technologies helps to stay competitive in an increasingly tech driven market.
Increasing Relevance of Parts Sales
As new equipment demand fluctuates the aftermarket is becoming a key revenue stream. Manufacturers shifting their focus on expanding parts and service offerings to create a stable long term income and strengthen customer relationships.
Market Intelligence & Pricing
Using market intelligence to implement data-driven pricing is key to being competitive and profitable. Real-time market-based pricing strategies enable manufacturers to align their offerings with market demand and customer expectations, as well as monitoring competitor actions in face of new market dynamics like international trade wars.
Customer Centricity
A customer centric business model is essential to build loyalty and satisfaction. By putting the customer at the heart of everything you do, machine manufacturers can build stronger relationships, retain more and drive long term growth.
Intelligent Solutions for Enhanced Customer Experience
In machine manufacturing, the integration of Artificial Intelligence (AI) has emerged as a game-changer, particularly in optimizing spare parts strategies and the streamlined management of extensive data sets. AI's expertise lies in its ability to analyze vast amounts of data with exceptional speed and accuracy, enabling manufacturers to make informed decisions regarding spare parts pricing. By leveraging advanced algorithms and predictive analytics, AI identifies patterns and market trends. With this, AI facilitates the development of effective pricing strategies, like market-based pricing, that adapt to dynamic market conditions.
AI simplifies the extensive task of maintaining large datasets by automating data processing and ensuring precision the after sales department. This not only improves operational efficiency but also enables machine manufacturers to stay agile and responsive in the face of fluctuating market dynamics, ultimately leading to improved customer satisfaction and sustained business growth.
WHITEPAPER
Grow Your Aftermarket Business
Market-based pricing enables machine manufacturers to optimize their aftermarket strategy. Our Ultimate Guide for Marked-Based Parts Pricing provides the key knowledge and tools to increase competitiveness in the parts business.
Data-Driven Pricing as Aftermarket Growth Strategy
In the aftermarket, particularly in the automotive industry, there’s a common perception that Original Equipment Manufacturer (OEM) parts are expensive and customers opt for cheaper aftermarket alternatives. This is a big problem for manufacturers: how do they maintain their parts business profitability while keeping customer loyalty to their brand? The temptation of cheaper, lower quality parts can erode trust and devalue genuine OEM offerings.
Market-based pricing is a solution to this problem. By pricing OEM parts to real-time market conditions, customer expectations and competitor pricing, manufacturers can stay competitive while still reflecting the value and quality of their products. This way machine manufacturers can find a price point that attracts price-conscious customers without compromising on the premium of their parts. Market-based pricing not only helps companies to stay competitive in a price sensitive market but also builds customer trust by being fair and transparent, ultimately leading to brand loyalty and long term profitability.
MARKT-PILOT's Solution For Increased Aftermarket Sales
The importance of market-based pricing for aftermarket success has already been stated. For manufacturers, the fastest way to get there is working together with MARKT-PILOT and their solutions, tailor-made for machine manufacturing.
Through the pairing of our intelligent solutions, PRICEGUIDE and PRICERADAR, not only do you elevate your pricing strategy, but you experience effortless market-driven parts pricing through automated, tailored, and verified price suggestions derived from PRICERADAR‘s extensive market research. Increase your revenue and margins right from the first pricing adjustment.
The market is increasingly dynamic and a new international trade reality is settling in. Make sure your pricing strategy is reflective of this. By utilizing MARKT-PILOT‘s solutions for your spare parts, your customers know that they are getting accurate and fair prices, thus enabling trust and placing you as their valued partner in the aftermarket.
Aftermarket success for machine manufacturers hinges on the strategic integration of AI, data-driven pricing solutions, increased market transparency and a flexible customer-centric mindest. Embracing these trends not only ensures the longevity and profitability of businesses but also positions them as industry leaders in an era defined by innovation, uncertainty and customer-centricity. By partnering with MARKT-PILOT and embracing the opportunities presented in the parts business, machine manufacturers can forge a path to sustainable success in the aftermarket sector.
What Does "In the Aftermarket" Mean?
"In the aftermarket" refers to the phase following the initial sale of a product, particularly focusing on the manufacturing, distribution, and sale of parts and accessories. It is a crucial segment for industries such as automotive and machine manufacturing, where it involves the repair, enhancement, and maintenance of vehicles and machinery.
What Does Aftermarket Mean on a Car?
In the context of a car, the aftermarket refers to parts and accessories that are available for purchase after the car has been sold by the original manufacturer. These parts can be used for repair, customization, or enhancement of passenger cars, offering alternatives to original equipment manufacturer (OEM) parts.
What is the Aftermarket in Machine Manufacturing?
In machine manufacturing, the aftermarket represents a lucrative opportunity for manufacturers facing challenges in new equipment sales. By focusing on spare parts and service offerings, manufacturers can create a stable revenue stream, enhance customer relationships, and ensure long-term profitability. The aftermarket in this field is essential for maintaining machinery, offering a variety of products and parts from different brands and retailers.
How Do Aftermarket Parts Online Benefit Consumers?
Aftermarket car parts available online provide consumers with a convenient way to buy parts for repair and enhancement of their vehicles. With a wide range of products and brands to choose from, consumers can find parts that suit their needs and budget, often at a lower cost than OEM parts.
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PARTS FORUM is Returning to Chicago: Here’s What You Need to Know
The industry conference for aftermarket and pricing in machine manufacturing professionals is gearing up for its 2025 event.
Pricing Strategy
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