spare parts pricing

Spare parts pricing is the term used to describe price management in the spare parts business.

The spare parts sector is becoming increasingly important due to the high share of profits. In many industries, a significant share of sales is increasingly generated in after-sales, the automotive industry being one example. Especially for OEMs it is important that a value-based pricing approach instead of a cost-plus pricing is used for spare parts. This is particularly relevant in the spare parts business, as price is the main selling point and switching to a third-party supplier is relatively easy. For example, products such as replacement batteries or smartphone displays now generate the majority of their sales through third-party online retailers.

Spare-Parts-Pricing at Homburg & Partner: Insight into practice

Based on the proven SMART Parts Pricing® approach, we optimize all price-relevant levers of our customers. Systematic optimization of spare parts prices allow for the realization of EBIT increases by 3-5 percentage points and significant volume effects. Even with low sales in the spare parts business, an optimization project usually pays for itself within a few months.