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Why implement an equipment as a service solution? Example with our partner Solfiz.

equipment as a service

Equipment as a service is a rapidly growing business model in the industrial sector. This market could reach 130 billion euros by 2025. Are you wondering whether this could be an interesting solution for your company? This business model offers many advantages as it allows equipment suppliers to still be the owners of a leased asset while providing additional services such as maintenance or insurance.

In this article, we would like to introduce you to our partner Solfiz, a specialist in equipment as a service. We will talk about its definition and the advantages of this solution.

I. What is equipment as a service today?

Definition

Equipment as a service, also called EaaS, is a growing business model. It is growing by 35% per year and is expected to reach 130 billion euros by 2025. It is part of the circular economy (eco-design, recycling, repair, etc.) and represents a real growth opportunity for companies.

EaaS is set up in the form of a service contract between a supplier, who offers his production, and a customer. It allows the suppliers of the goods to continue to own them while receiving periodic payments from their customers. In addition to regular income (rent), equipment suppliers can offer additional services in their contract such as consulting, maintenance, etc.

Equipment as a service is therefore a global offer with a product at the centre and various services that revolve around it.

Why is this a trend?

Use is now more important than ownership.

First of all, equipment evolves very quickly, maintenance must be carried out by experts, the market demands flexibility and costs must be controlled.

Technological advances, particularly in electronics, make it possible to put in place a specific offer for the customer depending on the equipment rented. This also makes it possible to carry out precise monitoring of the equipment in the form of tracing and remote data recording, for example.

The two main models

There are two major models for setting up facilities as services:

  • Firstly, the use of the facilities can be offered on a subscription basis. This takes the form of a rent paid monthly, quarterly or annually based on actual usage such as kilometres, hectares, time… An increase in the rent will make it possible to amortize certain expenses such as possible repairs or updates for example.
  • Then, the second model corresponds to the outsourcing of an equipment allocated for a specific time to a paying user. Customers come to the premises to use the equipment for a specific period of time. It is also a subscription for the use of an asset that they cannot or do not want to rent over a long period and therefore meets occasional needs. This model is still not widely used because it is more complex and limited.

2. Why implement an equipment as a service solution in your company?

There are several advantages to implementing an EaaS solution. Firstly, the generation of new revenues from added services. Secondly, it allows new innovations to be placed and tested on the market without risk and at a lower cost to the end customer.

With equipment as a service solutions, you can benefit from various advantages:

  • Improved customer loyalty with the creation of a global offer over a long period of time
  • Recurring revenue through additional services provided over a long period of time such as maintenance, insurance, etc.
  • Acquire new customers as you offer new services
    Increase your margins with the additional services you offer
  • Optimising the life cycles of your products thanks to the technologies implemented with the data collected

Even if this new model corresponds to the needs of the market, it is still complex to implement for manufacturers. Solfiz, our expert partner in equipment as a service, together with our subsidiary Chetwode 360 dedicated to this field, will help you to design and propose a sustainable and reliable offer.

3. Why is Chetwode a partner of Solfiz?

Solfiz is a white-label company that brings together a dozen experts in the field of equipment leasing in Nantes and a large network of professionals, mainly in other countries. They create, implement and operate white label equipment as a service solutions for manufacturers and distributors of capital goods.

We are partners with Solfiz. They offer our clients all the advantages of equipment as a service, both in France and internationally. We appreciate their innovative approach. Solfiz brings us their business expertise to create the most suitable global service offering for our customers. In addition, our customers benefit from their specially optimised digital platform for monitoring and improving the life cycle of their equipment.

Chetwode 360 is specialised in setting up and financing this type of activity. The two companies therefore complement each other in offering a complete EaaS service, from design to implementation and financing.

In conclusion, if your industrial company needs to generate new revenues and is looking for new outlets for its products, our subsidiary Chetwode 360 can accompany you with our partner Solfiz in an equipment as a service solution. For more information, please contact us, we will be happy to advise you.

The industrial finance press review

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