Remember when selling industrial equipment was straightforward? Sell the machine, schedule some maintenance visits, and move on to the next customer. Those days are rapidly becoming history, and smart manufacturers are discovering the alternative: equipment-as-a-service (EaaS).
The market signals are impossible to ignore. In 2023, the global EaaS market hit $1.5 billion, and it’s not slowing down—we’re looking at 50% year-over-year growth through 2030. But what’s really driving this shift? In this blog we’ll explore how a desire to change your business model can signal your organization is poised to join the embedded intelligence revolution. Let’s dive in.
Your Customers Want More than Just Hardware
Consider this striking reality: industrial manufacturers lose $50 billion annually to unplanned maintenance. When customers buy equipment outright, they’re taking on all the risk. If they’re not getting optimal performance or if something breaks, it’s their problem.
Your customers are feeling this impact directly, and they’re looking for partners who can help them solve it—not just sell them more equipment. But what if you could change that equation?
Three ways EaaS transforms your business
1. Predictable Revenue (That Your CFO will Love)
Instead of riding the roller coaster of one-time sales, imagine having steady, predictable revenue flowing in month after month. That’s what happens when you shift to usage-based or outcome-based pricing. Your customers get more predictable expenses, and you get more predictable revenue. Win-win.
2. Turn Data into Value
When your equipment is connected and monitoring performance 24/7, you can spot problems before they become disasters. Deloitte found that predictive maintenance reduces equipment breakdowns by 70% and cuts maintenance costs by 25%. That’s the kind of value that turns customers into advocates.
3. Become a Strategic Partner
This is about more than just changing your pricing model. When you’re delivering ongoing value instead of just equipment, you become part of your customer’s strategic planning. You’re no longer just the vendor they call when something breaks—you’re the partner helping them optimize their operations.
Making the Change to EaaS: What You Need
Successfully transitioning to EaaS means adding sensors to your equipment and ensuring they have reliable connectivity so you can access the equipment’s data. Let’s break down the essential components you’ll need to make this transformation work:
Reliable Remote Monitoring
Your equipment needs to consistently capture and transmit performance data. This means integrating sensors and monitoring systems that can track critical metrics like operational status, performance parameters, and early warning signs of potential issues. For example, in manufacturing equipment, this might include monitoring vibration patterns, temperature variations, and cycle times to predict maintenance needs before failures occur.
Secure Cloud Connectivity
Security is non-negotiable when it comes to industrial IoT. Your system needs end-to-end encryption and secure key storage to protect sensitive operational data. Modern IIoT solutions are incorporating sophisticated security features like STSAFE Secure Element with ECC NIST P-384 curve encryption, ensuring your data and devices remain protected from device to cloud.
Flexible Deployment Options
Every customer’s environment is unique. You need connectivity solutions that can adapt to different scenarios – whether that’s cellular for remote locations, WiFi for facility-based deployments, or LoRa for battery-powered applications. The key is having the flexibility to choose the right technology for each specific use case without being locked into a single option.
Scalable Data Management
As your fleet grows, you’ll need a robust system to manage all the incoming data. This includes:
- Real-time data processing and analysis
- Automated alerts and notifications
- Historical data storage and trending
- Integration with existing business systems
- Fleet-wide device management capabilities
Remember, successful EaaS implementation is about more than technology—it’s about creating a complete solution that delivers real value to your customers while being manageable for your team.
Why now is the time
The industrial IoT train is accelerating—analysts predict investments will blast past $1 trillion by 2026. Your competitors are probably already thinking about how to transform their businesses to keep up with Industry 4.0. The question is: will you lead or follow?
Additional Resources
Download our comprehensive guide 5 Signs Your Industrial Equipment is Ready for IoT Transformation to learn if you’re ready for IIoT transformation and how other Manufacturers are building new revenue streams with embedded intelligence.