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Babcock’s service contract transfers risk from customer to supplier

Babcock Babcock

Babcock International in Africa is one of the continent’s industry leaders in providing comprehensive infrastructure and reliable technical support to some of the world’s leading heavy duty machinery brands. As the exclusive regional distributor of Volvo and SDLG construction equipment, Tadano and SENNEBOGEN cranes, Winget concrete handling machinery, and rigid and articulated haulers from Terex Trucks, Babcock has built long-term relationships with its customers by delivering to the highest standards long after the sale has been made.

David Vaughan and Ben Buys, Sales Director and Operations Director respectively for Babcock’s Equipment division, discuss how Babcock’s tailor-made aftersales service contracts are increasing productivity for customers, protecting the residual value of owners’ machinery, and transferring risks associated with maintenance away from its customers.

“Our long-term replacement strategies, fleet maintenance and technologically advanced services are proving to be increasingly attractive options to our customers, particularly in the mining industry where machines operate long hours and any downtime translates into lost revenue,” says Vaughan. 

According to Buys, Babcock is currently ranked among the top three companies in southern Africa in terms of servicing facilities and technological training. He adds that a major portion of Babcock’s turnover is generated by customer service contracts with over 500 premier brand name machines on contract at the present time.

He explains that as part of Babcock’s comprehensive aftermarket support capabilities, every customer has access to the following services: Power by the Hour, Volvo CareTrack, and a re-build offering.  

Power by the Hour

Power by the Hour provides the owner with a fixed maintenance cost over an extended period of time based on a fixed sum per hour of machine usage. Machine owners are therefore assured of an accurate cost projection and largely avoid the costs associated with breakdowns. The contract includes the option of purchasing an extended warranty to give customers further peace of mind.

“Power by the Hour assists in protecting the residual value of a machine by increasing its future trade-in value and also aligns with the customer’s cash flow as they only pay when the machine is utilised,” says Buys. “An upfront rate is agreed upon that fixes the price of maintenance and parts for the first twelve months of the contract, allowing machine owners to forecast such costs with accuracy,” he continues.

These tailor-made contracts transfer the risk of component failure away from the customer and relieve the owner of the need to stock components. There is no inventory for the customer to carry as Babcock technicians are equipped with all the necessary components and tools to service the machinery on site, thus improving up-time and productivity.

Buys says that a further advantage of the Power by the Hour service contract is access to technological progress – a benefit that is passed on to the customer. “We keep on top of the latest technological advancements ensuring that the customer not only receives the correct parts but also the latest available on the market. Furthermore, we have a fully functional training centre that offers courses to Babcock technicians as well as our customers,” explains Buys.

CareTrack

CareTrack is the Volvo Construction Equipment telematics system that transfers data from machinery to Babcock’s dedicated internal service department. This remote monitoring system can be used to set service reminders in advance allowing sufficient time for the necessary resources to be deployed, and as an early warning system for potential component breakdown.

“With this system our technicians can identify when components need to be replaced or repaired, addressing any maintenance issues before they become costly problems later,” says Buys.

He adds that the system can also be used to geo-fence machines and track operating hours.

Re-Build

The rebuild offer is specifically geared towards the mining sector where machinery rapidly clocks up high production hours. Once a machine`s warranty has lapsed, customers are offered the option of refurbishment as opposed to trading in or buying new, where possible. This cost-saving alternative provides further hours of productivity from the refurbished machine, while Babcock parts and services extend the warranty for an additional 12 months.

Babcock’s aftersales support service is available across its extensive branch network throughout South Africa, Namibia, Zambia, Botswana and Mozambique. Technicians can also be dispatched to remote locations in Africa with all the tools and diagnostics necessary to complete a service.

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