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What are the benefits of Servitization?


Benefits of Servitization:

  • Enhanced customer relationships: Servitization models allow companies to build stronger relationships with their customers by providing ongoing support, maintenance, and upgrades for their products.

  • Increased customer loyalty: Companies can increase customer loyalty and retention by offering ongoing services and support.

  • New revenue streams: Servitization models create new opportunities for revenue streams, such as subscription-based models or pay-per-use services.

  • Improved Valuations & Access to Credit: Servitization models lower earnings volatility and create consistent, predictable revenue enabling better valuations and improved credit access.

  • Increased profitability: By offering services alongside products, companies can increase profitability through additional revenue streams and higher customer retention rates.

  • Differentiation from competitors: Servitization models can differentiate companies from their competitors by offering unique services that are not available from others.

  • Improved sustainability: Servitization models can improve sustainability by reducing waste and extending the life of products through maintenance and repair.

Benefits of EaaS for Customers:

  • Lower upfront costs: Customers can access expensive equipment without a significant upfront investment.

  • Flexibility: Customers can choose from a range of subscription or rental options to suit their needs.

  • Access to the latest technology: Customers can access the latest technology and equipment without needing constant capital investment.

  • Reduced risk: Customers can avoid the risks associated with owning and maintaining expensive equipment, such as downtime or repair costs.

  • Improved productivity: Customers can rely on ongoing support and maintenance to keep their equipment operating at peak performance levels, improving their productivity.

  • Predictable costs: Customers can plan and budget their expenses effectively, as they know exactly how much they will be paying for their equipment and services each month.


In conclusion, servitization models like EaaS can significantly benefit companies and their customers. Companies can create new revenue streams, build stronger customer relationships, and differentiate themselves from competitors. Customers, in turn, can access expensive equipment without significant upfront costs, benefit from ongoing support and maintenance, and improve their productivity and cost-effectiveness. As such, servitization models are becoming increasingly popular as companies seek to stay ahead in today's competitive business environment.

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