In economic downturns, the pressure is on to reduce costs wherever possible, but cost savings alone is not the solution. For manufacturing companies, a large percentage of revenue comes from service. An article yesterday in the Wall Street Journal talked about GE's plans to increase the amount of revenue from services in the industrial division from 65% in 2007 to 75% this year. As new product sales dry up, services is the place to make up for lost revenues.

GE is investing in new equipment that speeds the time needed to perform jet engine repairs. Since customers are not buying new planes, they need to get as much uptime as possible out of current equipment. Faster service has a cost savings benefit to GE customers.

The same results can be had with remote service. If your remote service program can increase uptime of mission critical equipment, service contract values and renewal rates should rise. One example in our customer base is Phillips, which saw a 12% increase in service contract renewals based on their Respi-Link remote service program.

Let me know what service revenue opportunities you see in your business.