Introduction to Rental Equipment

The migration to a service-based economy has led to a fundamental shift in manufacturing industries towards a business model in which the service component of products, based on the value provided to customers, is becoming dominant.

Corresponding to shifting requirements at the manufacturer’s side, it can be observed that customers are becoming less interested in buying products. In fact, they expect comprehensive solutions for their problems and more infrequently draw a distinction between product and service elements.

Following this shift towards an extensive service orientation, manufacturers need to up the ante by offering their customers more sophisticated solutions that will support customers’ operations and profitability. The concept of performance-based contracts strictly refers to this point. This approach means that products are no longer sold to the customer but instead the supplier provides and operates the product whereas the customer only has to pay for performance. Within performance contracting the customer does no longer buy products and several services separately, for example, the maintenance or repair services, instead he acquires a comprehensive service bundle. The supplier does not sell the product and instead provides the usage for a fee.