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Air Solutions - Case Study Example

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Air Solutions is proud to have today reached the league of the top three manufacturers of air conditioning units and compressors globally. From our modest beginnings, in 1994, we have today grown into a full fledged company manufacturing total air conditioning solutions…
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Air Solutions
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Download file to see previous pages We offer specialist capabilities and product ranges to meet the specification of complete air systems installation and pipeworking as well as for hydraulic systems, vacuum pumps and ancillary equipment.2
Keeping in sync with technology is of utmost importance to any industry, especially in the consumer industry. Air Solutions made major improvements in industrial air compressors within four years of its launch by the company in 1994.Similarly, in the case of HACU (Heavy duty air conditioning unit), the product was updated in 1996, eight years after its launch in 1996.This was accompanied by a massive advertising campaign. There were minor design changes in 1999, to improve the product. Thus, Air Solutions has been keen to match up to consumer preferences and update its products even before the standard ten-year operating life for which the product has been designed. The company believes in catering to well-informed consumers and spends on advertising campaigns about new product launches. A constant sales figures of 12000 units of IAC and HACU per annum prove the constant demand for these products.
Providing timely and necessary service support also form a key deciding factor while a consumer researches and zeros in on the company to buy the product from. Consumer service, not only before or during the sale of the product, but also after sales service play a vital role in determining the reputation and sales volumes of the company's products. While supply of spares and post sales support can provide an additional business opportunity, it might be a drain on the reserves and logistics of the company.
Typically, engineering, especially air conditioning companies introduce a product with an anticipated operating life of ten years. However, due to various market factors, these might sometimes be used for more than thirty years. Now, if the product is more than ten years old and has been replaced by a newer version, then there is little that a spares and support system can do to help the customer. Oftentimes, the cost of replacing the spares is a massive proportion of the cost of the product itself. In such a scenario, the customer might be advised to go in for a new product itself, instead of trying to repair the existing product.
According to the leading website on air-conditioning, heaters and refrigerators, "Variable Frequency Drives Running on Bypass Can Waste 56 Percent or More Energy for Your Air Handling System. Despite the economic advantages and significant energy savings available by using AC variable frequency drives (VFDs) in HVAC applications, many building operators do not repair or replace drives when they fail since the motors can easily continue to run through a bypass contactor. While this is a great solution for short-term outages, continued operation in this mode quickly becomes a very expensive way to operate a fan."1
Strategy
The strategy to make the most of the spares and sales support department would be to: (i) Strategically locate these warehouses
Proposed Locations: Manchester, Birmingham, London, Singapore, Europe, U.S, Africa
1) at the site of production of IAC and HACU ie. one at Manchester and another at ...Download file to see next pagesRead More
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