PTC > Case Studies > JLG Industries Revamps Service Parts Pricing Strategy with PTC’s Solution

JLG Industries Revamps Service Parts Pricing Strategy with PTC’s Solution

Customer Company Size

Large Corporate

Region

America

Country

United States

Product

PTC’s Service Parts Pricing

Tech Stack

Cloud Services

Implementation Scale

Enterprise-wide Deployment

Impact Metrics

Revenue Growth
Customer Satisfaction

Technology Category

Platform as a Service (PaaS) - Data Management Platforms

Applicable Industries

Equipment & Machinery

Applicable Functions

Sales & Marketing
Business Operation

Services

Cloud Planning, Design & Implementation Services

About The Customer

JLG Industries, Inc. is a globally recognized company that has been earning customer confidence and trust through innovation since 1969. The company manufactures JLG® aerial work platforms and JLG and SkyTrak® telehandlers. JLG’s customers are their greatest priority, and the company remains steadfast in its commitment to understanding customer challenges. The company was facing competitive pressures on its replacement parts business and needed a solution that enabled more strategic service parts pricing to meet mission-critical goals to increase profit, increase revenue, and improve data integrity to better compete in the marketplace.

The Challenge

JLG Industries, a renowned manufacturer of aerial work platforms and telehandlers, was facing increasing competitive pressures on its replacement parts business. The company was using a cost-plus pricing strategy for its service parts, which was proving ineffective. This approach created a 'blind spot' and lacked market adaptation. Customers were seeking more cost-effective solutions and started buying non-OEM replacement parts from competitors, compromising quality for lower pricing. This trend signaled to JLG the need for a new approach to parts pricing. The challenge was to optimize pricing for 140,000 service parts with a department of one.

The Solution

JLG Industries adopted PTC’s Service Parts Pricing (SPP) solution to revamp their pricing strategy. The SPP solution allowed JLG to organize and develop their strategy and assess their competitive environment. The solution was presented to JLG’s leadership team by the JLG IT department and Dali Ribeiro, Parts Pricing Manager at JLG. The value analysis of SPP, along with a commitment to closely monitoring and tracking SPP’s impact on service parts revenue and profit, led to SPP being adopted as a strategic initiative for JLG. The implementation of SPP moved JLG away from managing pricing strategy through an extensive array of spreadsheets. The solution was hosted on PTC's servers, alleviating the burden of maintaining an on-site solution by JLG’s IT department.

Operational Impact

JLG was able to communicate their pricing strategy to their customers and show them that in many cases, they were able to offer a lower price with OEM commitment to quality and service support.
The implementation of SPP improved data integrity at JLG, and they gained visibility into cost changes coming from their suppliers.
The solution was simpler to adopt and teach, making it easier to bring people on board.
The solution allowed for exception-based management, giving local input with about 20% of parts while automating the pricing of 80%.

Quantitative Benefit

The tool paid for itself in less than 12 months.
After one year, a follow-up analysis concluded that the three-year cumulative value to JLG would be 60% higher than originally projected.
Revenue growth continues to outpace the rest of the legacy-managed parts, while the growth of gross margin contribution outstrips the field by even greater margins.