Synopsis: Kitting Strategy to Combat Aftermarket Competition
A leading manufacturer of engines was looking for a strategy to offset the efforts aftermarket suppliers – will-fitters – were having in his market. More and more customers were being approached by copy-cat aftermarket parts suppliers looking to displace the company’s OEM parts for engine overhauls.
QDI consultants conducted interviews with customers and every member of the value chain to understand the dynamics of the market. The research found that the aftermarket suppliers were picking on parts that were not the core of the engine. The also found that the customer incurred a substantial cost in pulling together orders for engine overhauls as there could be hundreds of individual parts in an overhaul.
The solution was to introduce “engine overhauls kits” that included all the parts for an overhaul for all engines. The kit provided a huge cost savings to the customer from the “time savings convenience of only having to order one part number instead of hundreds and of only having to handle the parts and paperwork one time instead of up to five times in his materials management group. Combining this savings with a single price for the whole kit created a powerful value proposition for our client which was met with enthusiastic market response.