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Allow me to pose a question, thoughts for the trade members, spares wholesalers, manufacturers and consumers:
Why is it, when the retail prices of products offered for sale to the public are dropping, the price of replacement spare parts are rising rapidly.
How can any manufacturer justify the price of a part which has a high failure rate selling it at roughly 1/3 – 1/2 of the price of the whole appliance at the retail selling price.
Why is it so difficult to obtain spares and/or information for the more obscure brands now being sold in this country, most of which are at the lower (cheaper) end of the market, which, because of the retail price sell in extremely high volumes.How can any manufacturer expect to realise a good reputation, thereby increasing their sales when it takes 4-6 weeks to obtain a replacement spare part for an appliance that has failed within the guarantee period.
A message to ALL manufacturers:
How does the back up service effect your sales ?
How do the retailers react when they recieve numerous complaints about poor service/spares ?
Does the retail price of your product actually reflect the level of service your customers should expect ?
Please think long and hard about this, as it the biggest underlying problem within our industry !!
Juan
Sales and Service.
Part of the answer is that within these manufacturers companies each Department are seperate trading budgets.Sales generates the largest revenue and has always called the shots.
Service has been funded from a budget that is generated from sales.As low as it sounds this could be based on a 4{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} failure rate (in guarantee) so Service never seems to have enough cash to cope when things go wrong.Spare parts sales are the icing on the cake for the manufacturer and the potential being lost on the sale of the appliance can be clawed back by direct selling of spare to trade and public.
The only way forward is for sales to take an active part in the rest of the business and to support service.
You have to realize that revenue generated from spare part sales will not get into the service budget,its a part of the sales budget.
I do not think it is “we ” that is being ripped off but the public.They choose to pay for the spare or replace the appliance and from the manufacturers point of view there are 1.8 million washer sales per year in the uk and they invest in capturing market share.Which ever way they go the manufacturer has an angle on the cash.regards kevin
Re: Sales and Service.
ted wrote:As low as it sounds this could be based on a 4{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} failure rate (in guarantee) so Service never seems to have enough cash to cope when things go wrong.
Yes it never has enough cash to cope simply as the cost of service is not relative to the cost of the appliances, the two are worlds apart on costings, and it would appear that many manufacturers fail to see this for whatever reason. By that I mean that the cost of a repair or providing any service is not in direct relation to the RRP of an appliance therefore, the repair cost always seems extremely high in relation to the selling price of the machine. The same effect does translate to other industries but it is very acute in ours given the low prices of most mass market appliances these days.
The other think to bear in mind is that more and more those of us that are doing IG or EW work are finding that chargeable repairs are steadily dropping, as are margins on EW work and, indeed EW work itself in many areas, to such an extent that many of the service companies around the country are struggling to make ends meet. This phenomena is simply attributable to the low RRP and therefore the expectation of a low cost service to be provided that is in relation to the appliance’s RRP. But with high spares costs, increasing labour costs amongst the general costs of running service the actual cost of service is and has to, rise.
Catch 22!
K.
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