Eindhoven - Today, DLL, a global provider of asset based financial solutions launches its second white paper, “Complement new equipment sales with pre-owned assets”, to refute manufacturers’ anxiety for cannibalization and highlight its strategic benefits. DLL concludes that remanufactured pre-owned equipment product lines may even enhance financial performance.
Second life as a business opportunity
Today many manufacturers mainly focus on selling new assets . The current paradigm is that offering remanufactured or refurbished assets and services negatively impact new asset sales. This phenomenon is more known as cannibalization. It refers to customers obtaining second life assets while they have had the required budgets to acquire new. DLL investigated whether cannibalization is an issue for manufacturers and gives insights on the strategic benefits of second life business. Additionally best practices on how manufacturers can minimize cannibalization risk are being summarized.
DLL researched best practices of various partners that are engaged in second life business. None of these manufacturers reported any explicit negative impact on their new asset sales. Additionally DLL researched external communications of over 218 manufacturers across the Construction, Transportation, Industrial, Food and Agriculture industries. An increasing number of manufacturers see the business benefits of being actively engaged in second life assets. However less than 1% of them has a remanufacturing program.