Competition in the Aftermarket Never Hurt Anyone
Quite frankly, I am not sure why some OEMs want to take an adversarial stance against ISOs. Sure, it is within the legal rights of an OEM to withhold intellectual property but this can be counterproductive to the market. First, customers want choices when it comes to purchase of the equipment as well as purchase of aftermarket services. By trying to squash competition through adversarial tactics, the OEM eliminates choice.
Second, a landmark Supreme Court Case in the 1990s between Eastman Kodak (Defendant) and Image Technical Services (Plaintiff) ruled that an OEM can have monopoly control over the After Market even it doesn’t have control of the Product market. AS a result, certain competitive practices like tying in the purchase of parts or diagnostics software with service contracts is a violation of Sherman Anti-Trust Laws.
Rather than erecting competitive barriers, OEMs are advised to consider how Companies like IBM, Siemens, HP, Comcast, and Philips, etc. effectively use ISOs to deliver field service on an efficient, productive, and quality basis. Over the years, a number of OEMs have acquired ISOs to not only augment and expand service capabilities but also to develop multivendor service skill sets in order to better service customers who require a single point of contact, total service solution.
The fact of the matter is that independents provide value to manufacturers by the mere fact that they force manufacturers to be proactive and innovative in serving their customers. Let’s face it; implementing strategies and tactics to squash compettion is the act of desperate company. Most companies win market share and create sustainable, profitable revenue growth through a business model built upon a committment to customer satistaction, quality processes, highly effecient systems, and well trained people. Furthermore, these companies view compeitition as a healthy thing. Why not use the same standard when it comes to the Aftermarket?
To learn more about strategies and tactics for winning business in the Aftermarket contact us at 215-643-9060 or visit us at www.blumberg-advisor.com