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Service now! Time to wake up the sleeping giant

Service now! Time to wake up the sleeping giant

Industrial goods manufacturers face an increasingly volatile and difficult market. But there is one business area that can help them to become more stable, and definitely more profitable. And all this with a minimum of investments: service.

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Service now! Time to wake up the sleeping giant
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Be ambitious!

Developing a service business is a very attractive opportunity for most industrial goods companies, but one that remains largely underexploited. Performance within the sector is already impressive: services generate between 20% and 25% of revenues for many European industrial goods manufacturers, accounting for half of the sector’s profits and growing steadily at 5% annually. Even so, considering the full potential of their installed base, industrial companies typically reach only 10% to 25% of potential revenue—and many companies don’t even know where they stand with their service potential.

A new study by Bain & Company, “Service now! Time to wake up the sleeping giant,” introduces Bain’s Service Excellence Framework. In it, we show proven steps for building a more efficient and profitable service business and describe the successful transition to becoming a customer-focused service provider—a challenging endeavor, but one that offers great rewards. Depending on the industry, an effective service line can generate more than 50% of revenues. In a challenging economy, service remains one of the biggest growth opportunities for the industrial goods industry, one that shouldn’t be left to competitors.

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