Velroq and Sandvik develop two-pronged approach to keep older equipment working
Taking a ‘no customer left behind’ approach to ensuring machines remain in full utilization has rarely been more important. Now hands-on rock drill customers can benefit from a new online parts supply operation – Velroq – while Sandvik is developing a more structured used equipment offering.
With worldwide supply chain issues still affecting the availability of new equipment, major OEMs are working to reduce the risk of customers being left stranded without a working machine. One new entrant is Velroq, an online-only parts website to ensure surface construction machinery users – in particular, those who carry out their own servicing and repairs on typically older machines – can enjoy maximum utilization.
Although currently serving Sweden alone, Velroq hopes to eventually support customers worldwide from its comprehensive inventory of genuine OEM and quality replacement parts. With over 300 items currently available, covering maintenance kits, wear parts, power packs, undercarriage, hydraulics, boom and feeds, and more – with SKUs growing daily – parts can be delivered within 1-2 working days, typically at prices around 20% cheaper than can be found elsewhere.
“There’s nothing else with this level of precision out there for these typically older machines,” says Viktor Valk, business development manager for Velroq. “Some of the big online players have huge lists of spare parts – each of which can have alternative part numbers – but our website lists them according to machine model, so customers can be sure they’re ordering the correct items. But if there is a mistake, we have a no-question returns policy up to 30 days after purchase.”
This transparency and convenience are key advantages of the venture, along with a range of delivery options that ensure optimum value for money. With grey-market copies typically averaging around 70% of the cost of genuine items, this new arrangement makes the fitting of OEM-approved parts a more financially attractive option for customers who prioritize lower cost of operation. And with construction drills being a relatively rare sight out in the field, finding parts for specific models can be difficult – or expensive, with some even retailing for 130% of the OEM cost.
“Many pattern parts are fairly good quality, producing only a 10-20% drop in performance, so we are leveling the playing field by providing more affordable OEM-quality alternatives,” elaborates Valk. “It’s really just our selling proposition that distinguishes us from OEMs.”
“Sandvik offers additional services and support along with the parts, using the data coming from the machines to better support customers with higher utilization and production rates – that’s just one example of where its extra value comes in,” continues Valk. “But if you have an older machine, you may be more interested in finding cheaper components than subscribing to those kinds of services, and that’s the customer niche Velroq has been created to fill.”
Hang on in there
Keeping machines in optimum condition for longer is a challenge that even the bigger players in the market face, with many holding onto their drill rigs for an extra 12-18 months until new models become available. This creates a problem for Sandvik’s used equipment division, which has been established to secure a supply of quality machines for customers outside of its traditional markets.
“We are currently pushing rental units as a stopgap solution for customers who are having to wait for a new machine, which is proving popular,” says Ronan Mac Lennan, global used equipment manager. “But we’re also readying ourselves for the time when things get back to normal and we can start processing a flow of used equipment – particularly in those areas where we don’t normally sell new machines.”
Parts will have a key role to play in this business too, as a strategy is being developed to formalize a method of preparing incoming equipment to a high standard before resale. “There’s currently no fixed approach, but we’re going to change that,” says Mac Lennan. “I want to offer tailored service, warranty and parts solutions on the back of a sale, and offer a partial rebuild option. I also want to develop this to the point where a lot of used machines are coming back and being traded in, so we can start penetrating the next resale stages too.”
Ronan Mac Lennan, Global Used Equipment Manager at Sandvik, said: “At the moment, once a machine falls out of warranty, customers will do most of the repairs themselves and it falls off our radar – yet there’s an entire revenue stream being spent on it in the form of service, parts and maintenance that we have no access to. With a strategic push, we hope to change that, creating benefits for us, as well as the user. But if we still can’t reach them – well, there’s always Velroq to supply quality OEM parts direct to the customer in a cost effective way.”