Pattern description

A full service provider offers total coverage of products and services in a particular domain, consolidated via a single point of contact. Special know-how is given to the customer in order to increase his or her efficiency and performance. By becoming a full service provider, a company can prevent revenue losses by extending their service and adding it to the product. Additionally, close contact with the customer allows great insight into customer habits and needs which can be used to improve the products and services.

Inventive problems

Application examples

Globally leading wholesaler Würth supplemented its traditional screw business with over 120,000 fastening and assembly products as well as tools. Tradesmen can get everything they need from Würth and in many cases they don’t even need to worry about ordering supplies of consumables. Würth transformed itself from a two-man business to a Solution Provider within a generation, going on to have over 66,000 employees and earning €10 billion in revenues. Würth is currently working on the challenge of bringing its successful business model to Asian growth markets.

Swiss packaging company Tetra Pak also learnt how to be a successful Solution Provider. The firm offers its customers a wide portfolio of products and services to process, package and distribute food. Customers are provided with complete onestop solutions ranging from product reception (foodstuffs and drinks) to final treatment and packaging. In addition to developing Tetra Pak packaging materials, the company also designs entire bottling and packaging plants. Its innovative aseptic processing technology prolongs the shelf life of drinks and foods, bringing with it reductions in distribution and storage costs. By providing a range of solutions from a single source, Tetra Pak is able to attract customers with its efficient and cost effective service, thus securing consistent revenue and high profits. The company operates in 170 countries and employs over 23,000 people.

Best Buy’s Geek Squad has a business model that revolves around providing comprehensive around-the-clock, 365-days-per-year service in the field of technical support and troubleshooting for all types of electronic devices: computers, mobile phones, printers, consoles, webcams, as well as DVD and MP3 players. If customers have trouble with any of their products, Geek Squad will work towards finding a solution to their problem. The company’s in-house task force of trained specialists is available to assist customers in person either by phone or online. Technical support membership plans are available for fixed monthly fees, as well as insurance plans and repair services. Geek Squad seems to have its finger on the pulse of modern consumers who are increasingly overwhelmed by complex electronics. The company is based primarily in the United States, employs over 20,000 agents, and has seen double-digit growth rates since being founded in 1994.

References

The Business Model Navigator: 55 Models That Will Revolutionise Your Business