The service parts industry – specifically automotive, heavy equipment, aircraft and aerospace parts manufacturing and distribution – generates trillions of dollars in annual revenues. Given the fact that many of the industry’s manufacturers and distributors struggle with pricing, it’s clear that these revenues, while impressive, do not come close to capturing market potential. Why are these companies selling themselves short? The answer to this question may be answered in part by considering service parts industry leaders’ estimations of their own pricing performance.
To kick-off the PROS Spotlight on Service Parts Series, we surveyed 100+ service parts industry executives to gauge their strategic pricing performance. To quantify their operations, our survey respondents were asked to rate their company’s overall operational pricing maturity, including business problems, technology and pricing strategy. Our survey results indicate that most respondents rated themselves as slightly above average, though the results indicate a different picture, with the majority facing four strategic business challenges. In today’s competitive business climate, a single challenge may well cast a monumental shadow on profitability.
Respondents were divided between large and mid-market companies, in a 60-40 ratio. They share common challenges, and yet a whopping 65% identified their biggest obstacle as an inability to acquire, leverage and integrate big data.
It reminds of the quote attributed to John Wooden: “Being average means you are as close to the bottom as you are to the top.” By any measure, opportunities abound for the service parts industry, and yet most companies remain in a quagmire with ‘average’ operations, according to our survey.
- As service parts industry leaders, are you satisfied with being average?
- Are your company executives satisfied with average?
- If your customers knew you were average, who would they call first?
The PROS Spotlight on Service Parts Survey white paper below explores the results of this survey, asks probing questions that emerge from these results and suggests ways for service parts companies to take their pricing strategy to the next level.