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Appliance Service Industry and Technology

Appliance Service Industry and Technology

The intent of this article to explore the Appliance Service Industry, its technology footprint, challenges, and potential solutions.

Major appliances, also known as white goods, comprises of major household appliances and may include air conditioners, dishwashers, clothes dryers, drying cabinets, freezers, refrigerators, kitchen stoves, water heaters, washing machines, trash compactors, microwave ovens, and induction cookers. American households are stacked with such appliances implying there is a high demand for its spare parts and servicing.

We know that many times when an appliance stops working or needs a service, the first thing we do it contact the seller provided the product is under warranty. However, if the product is not under warranty, we look for service providers. I would say it’s not very common (yet a hobby) that one would try to service their appliance themselves by identifying the problem, purchasing the spare part, and replacing/fixing it.

Most of the significant appliance brands like Whirlpool, LG, Samsung, Frigidaire, KitchinAid, GE, etc. purchase the spare parts through wholesale retailers and use their service partners for facilitating customers. This means there is much opportunity for service companies and whole retailers to expand the business.

Current challenges

Although there are huge B2B and B2C opportunities for the service industry and B2B opportunities for wholesale retailers, yet there are some major challenges.

1. Long service cycles:

From the time a service appointment is made until the issue is resolved, there is a considerable delay in the process. To give a walkthrough of the challenges, the following is the current service lifecycle that we have observed.

The above cycle makes it inconvenient for the customer to wait for an extended duration actually to resolve the issue with the appliance.

2. Old retailer and service provider applications:

Usually, appliance service provider and relaters are not very tech-savvy. They run the business on old technology solutions and platforms. They have non-intuitive websites with rudimentary features to support the business as the current applications are about 10-15 years old. It is also observed that most businesses operate on paper, phone calls, and sometimes need to go to the store physically. This makes it extremely difficult for the manufacturers and service companies to provide services at a faster pace thus resulting in delays.

Another point to be noted is that none of these businesses (service provers and retailers) can perform because while their current technology is stable, it’s still not scalable for the current demand. This also makes it extremely difficult for big manufactures to place orders for parts and manage service appointments.

3. Lack of proper visibility on demand and supply:

Most of the time, there is no analytical data to support the service providers and retail companies to provide visibility on demand. This makes it difficult for them to plan for the future and they only rely on current needs.

How can technology help transform?

1. Start small and transform incrementally:

Define MVPs in the current ecosystem. Identify the low hanging fruit, which would have the most valuable impact on business. Some of the instantiate that may come under this are:

__a. B2B and B2C website transformation:

_____i. Involve UX teams to analyze the business and users. Build solid experiences involving users for feedback. Get responsive design prototypes (both mobile and web) from the UX team.

_____ii. Work with the product owner and define a road map for the effort and generate a list of features that would be needed for the new website.

_____iii. Identify the right UI technology based on business research to build a new and better website from scratch.

_____iv. Create a stable distributed and scalable middle tier to integrate with the existing backend (AS400, Other ERP’s, Databases).

_____v. Identify and implement standard technology solutions for critical features like search and browse, payment gateway, data caching for performance, non-relational data storage, security, among others.

__b. Content Management Solution:

_____i. Instead of having site content in the code, identify tools (like WordPress) to manage and maintain site content at one location, which could be easily modified without making code changes.

_____ii. Control the website’s template, content, and creativity in one central place.

__c. Marketing Solution:

_____i. As a part of this effort trying to capture on-site data usage to understand how the customers are interacting with the website, what is working in the design and what is not, how to attract customers with marketing content.

_____ii. Broadcast marketing content/ads based on user searches in various web channels.

2. Migrating from Legacy ERP systems to the latest ones:

__a. ERP system is the heart and soul of business. This makes it very difficult for organizations to think about migrating from current completely/partially stable system to a new one. “If it’s working, why should I change?” is a significant decision-making factor for a CEO or CTO in this business.

__b. We want the business to understand that business strategy is rapidly changing. To keep up with new ideas and implementing them, old technology can prove to be a barrier. This results in building custom solutions which over a while, become difficult to maintain. This adds a lot of costs to support, maintenance, and enhancement.

__c. We recommend thinking out of the box and exploring the latest ERPs to expand and grow business. In 2020, I would group the ERPs in the following way

3. Invest in solutions to bring the appliance companies, service industry, and parts retail industry closer:

__a. Applications with the capability to predict possible issues and necessary parts for a given problem. Create automated job requests and ship the parts in advance to customer or service company for faster resolutions.

__b. Build an analytical platform to provide data to service/appliance and retail companies like current issues across models, the average age of appliances in areas, service predictions and demand data, etc. to help plan and market.

__c. Create a stable and scalable returns platform as we see these businesses operate a lot on returns.

__d. Facilitate credit solutions for retails to help service companies and appliance companies.

__e. Device advanced bulk ordering capabilities for retailers to help service providers and appliance companies to stock parts inventory.

__f. Integrate advanced mobile apps with interactive features for customers and servicemen to help get details on a particular model, identify issues, order parts, and possible instructions to fix a problem.

__g. And many more!

4. Consider migrating to cloud:

__a. It’s time not to manage your infrastructure and let the experts handle it for you.

__b. Explore the full range of services and provided by your cloud partner so that you can spend more time improving the business and not worrying about infrastructure.

__c. Overall reduce cost and be efficient!

Author:

Girish Mallampalli
Director of Architecture and Delivery

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