Progressive Distributor - Repair services can boost your bottom line

Repair services can boost your bottom line

by Bill Moore

Repair services for rotating equipment represent an expanding opportunity for industrial distributors. While most distributors currently provide repair services at some level, either in-house or on an outsourced basis, there are opportunities to partner with manufacturers to enhance repair offerings and further boost the bottom line.

Customer demand for repair services is growing rapidly. Your MRO customers face intense pressure to extend the life expectancy of plant machinery in order to improve productivity. Another factor is the focus on sustainability. Today’s corporate environmental policies advocate repairing used machines and equipment rather than scrapping them.

In addition, repairing equipment often proves less expensive than investing in new equipment. Large made-to-order bearings, for example, can be reconditioned to like-new quality for as little as half the cost of new bearings. Downtime is also a consideration. Rotating equipment can be repaired and returned to service more quickly than it takes to manufacture and deliver long lead-time new equipment.

In-house repair vs. outsourcing
To meet the growing demand, many distributors are enhancing their repair offerings. The most common repair programs involve gearboxes, pumps, bearings or electric motors. When upgrading your repair services, the manufacturers you represent can provide vital technical support and assistance. They are likely to have considerable expertise in important repair sectors.

Distributors must decide which type of repair activities to offer, and weigh the pros and cons of performing repairs in-house versus outsourcing them. By outsourcing, your company can reduce its investment in employee training and repair equipment. There is also the benefit of associating your company with an established repair provider, such as a well-regarded motor shop.

In contrast, the advantages of performing repairs in-house include close oversight of repair activities and direct control of customer relationships. Making repairs in-house can also create synergies between repair services and other business offerings, maximizing potential profits. Distributors can select the option that best suits their company’s business model.

Making “certified” repairs
Some leading manufacturers have introduced repair programs that offer training and certification to distributorships. The programs authorize distributors to provide “certified” repairs, adding value to distributors’ repair offerings.

Typically, the certifying manufacturer trains distributor employees regarding the specifications and repair practices that extend the life of components and machines. In the case of pump or gearbox repair, for example, the training would cover bearing installation, shaft and housing fits, lubrication, and sealing practices. Employees must pass a test before receiving certification.

As a certified repair provider, the distributor gains preferred access to the manufacturer’s technical support and engineering resources, and receives marketing and sales support. The distributor can assert that repaired equipment is reconditioned to “factory specs” or, with pumps and gearboxes, to “best practices.” In return, the distributor commits for a specified period to use the manufacturer’s products in its repairs.

In the case of more complex repairs or those involving larger items, such as large size bearings, distributors can outsource the complete repair to a manufacturer. Another option is to partner with a repair shop that has already received a manufacturer’s certification.

Supplying repair services is an excellent way to differentiate your offering from those of commodity providers. The availability of such services can be an important value-add, one that lower-cost suppliers can not duplicate. To learn more about repair training and certification opportunities, consult your manufacturer partners.

Bill Moore is senior vice president, Sales Development
and Channel Management, SKF Service Division, based in Kulpsville, Pa. Contact him at William.C.Moore@skf.com,
or at (215) 513-4851.