Telecom Distributors are Taking Advantage of Aftermarket Sales & Service
Telecom Distributors – Aftermarket Sales & Service
Telecom distributors are finding that reselling their used telecom equipment and excess product materials can help create an additional source of revenue. In fact, the telecom aftermarket is one of the largest resale categories in the industry.
According to a recent report, most industrial businesses can earn up to 35% of gross profits from the aftermarket. Despite the aftermarket’s benefits, some companies miss the potential opportunity for more revenue. They perceive reselling to be an unnecessary part of business and a needless expense.
The reason for their skewed perception is because after-sales support is notoriously difficult to manage, and only companies with efficient service systems in place can succeed.
Original equipment manufacturers (OEMs) carry spare equipment, but most companies don’t get the best out of those assets. With consistent advances in technology, it’s estimated that about 20% of spare telecom parts become obsolete every year – so it makes sense to utilize the aftermarket to gain the value of those items back.
The same goes for telecom distributors. Providing resale support generates a low-risk revenue stream over a long period of time. Aircraft manufacturers, for instance, can reap additional revenues for as long as 25 years after a sale. The longer the life of the asset, the more opportunities companies will find down the line.
Increasing sales of parts and service-related products costs businesses far less than finding new customers, though they can successfully cross sell and up sell only if the support they offer satisfies existing customers.
When businesses provide aftermarket support, they gain a deep understanding of their customers’ technologies, processes, and plans—knowledge that can’t be easily acquired by the competition. That provides companies with an unlikely, but sustainable, competitive advantage.
Most companies may find it difficult to compete in the aftermarket. Delivering after-sales services is more complex for telecom distributors than manufacturing companies. When delivering resale products, they must deploy parts, people, and equipment at more locations than they do to make products.
- Companies must keep product promises – that they successfully manage design, price, and delivery to customers in order to generate revenue
- Companies must design relevant and reasonably-priced service packages
- Companies should visualize a distinctive after-sales service supply chain that depends upon a reliable network of resources: materials, infrastructure, warehouse and transportation staff
It’s wise for telecom distributors to depend on an independent third-party to manage their reselling efforts. These special vendors have become a tremendous asset to these companies, leaving them to focus on after-sales services. AECI is an outstanding third-party vendor which can help you manage your aftermarket selling efforts. We’ve been assisting customers for over a decade – contact us is if your company is eager to enter the aftermarket!