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The Bottom Line on Customer Support Agreements

4/14/2011

Many heavy equipment owners buy Customer Support Agreements (CSAs) for economic reasons. Typically, you pay a fixed amount for some portion of your maintenance and service work-maybe even all of it. And in return, you expect to get results that strengthen the bottom line: better cost control, more production, extra uptime, fewer unplanned repairs and higher resale value.

While all those benefits are extremely important, there's another good reason to consider a CSA. The right agreement can enhance your performance as a socially responsible business.

A growing concern
Social responsibility is more important than ever. As citizens of the planet, we all value clean air, water and soil. We recognize the need to work safely, conserve natural resources and reduce waste. So running a socially responsible business
is a personal priority for most of us.

It's also a business priority. Operating as a good citizen and good neighbor can reduce the risk of costly penalties or shutdowns associated with regulatory issues. It can also strengthen a business owner's reputation and open the door for a larger share of the available business.

If you're ready to sharpen your focus on social responsibility, a CSA can help. Here's how.

It all starts with safety
As you think about your social responsibility objectives, preventing accidents and injuries is probably at or near the top of the list. We're all committed to continuously improving workplace safety.

Having a CSA for your machine or fleet doesn't guarantee safety, but it can make a positive difference. Generally speaking, when machines are well maintained and inspected regularly, there's a higher probability that potential problems will be caught early-before they turn into bigger issues or safety concerns. In addition, if dealer employees are doing your maintenance and repairs, they're more apt to have the tools and training required to do the work safely. Some more comprehensive CSAs include operator and technician training, which also contribute to workplace safety. Talk to your dealer about the agreements they offer and look for one that supports your safety strategy.

Optimize performance, fleet size, fuel economy
Whether you operate a single machine or a large fleet, you can reduce environmental impact by keeping your equipment well maintained. When you buy maintenance CSA, you can be sure that work will be done on time and according to schedule. As a result, your equipment will run at top performance, and you'll experience less unplanned downtime. That should make it easier for you to complete jobs faster and more efficiently. So you'll get on and off the job site in less time, reducing noise and emissions in the area. Plus-if your fleet is producing at the highest possible level, you may be able to do the work with a smaller number of machines. That means less environmental impact in terms of fuel consumption, emissions and sound.

PM service reduces disposal risks
Every time you change fluids and filters, you run the risk of a spill. You also encounter all the costs and challenges associated with fluid and filter disposal. There's a simple way to avoid these problems. Purchase a CSA from your dealer
and leave the disposal issues in their capable hands.

Condition monitoring and regular inspections extend life, reduce waste
If you discard a part or component before its useful life is over, you're making two mistakes. First, you're failing to recover all the value that was designed and built into the product. And second, you're putting something into the waste
stream that doesn't need to be there-at least not yet.

By purchasing a CSA that includes condition monitoring services-like oil analysis, coolant analysis or hydraulic system inspections-you can track component life with greater precision. Your dealer can give you concrete information about
machine health and help you monitor component life over time. Together you can plan component replacement at the right time.

Second-life options support reuse and recycling
When you buy premium-quality equipment and manage it effectively with a comprehensive CSA, you can run it for a very long time. You may even get a second life from it. In the case of Cat® equipment, many options are available to
keep older iron on the job-and out of the scrap heap-so you can save money and demonstrate environmental responsibility at the same time.

Caterpillar Reman products are a good example. Cat's Reman group takes back about two million end-of-life products every year. We recover over a 100 million pounds of iron, then salvages and reuse more than 70 percent of that material.
When parts are remanufactured, about 85% of the energy expended during the original manufacturing process is preserved. So the Reman option makes sense environmentally as well as economically.

The same can be said for a Cat Certified Machine Rebuild. Cat Dealers can give some older machines a new life via a proprietary rebuild process. More than 350 tests and inspections are performed on parts and components to measure
wear and ensure a complete second life can be obtained. Over 70% of the parts and thousands of pounds of iron are salvaged and reused in every rebuild. The result is a like-new machine with the latest technology and updates-at a fraction of the cost of new. A Cat Certified Power Train Rebuild is also an option for customers interested in restoring life only to their machine's power train components.

These options, and others, are ideal for products that have been well taken care of under the terms of a comprehensive CSA.

The bottom line on CSAs and social responsibility
A CSA can deliver positive results-no matter how many machines you operate, how old your equipment is or what type of work you do. The key is to structure an agreement that meets all your business objectives-your production and cost
goals, as well as your social responsibility strategy. It takes resources and experience to develop and manage an agreement like that. So make sure you're working with the best, a trusted advisor that will be there over the life cycle,
partnering with you to maximize the value of your equipment investment and strengthen your reputation as a profitable, socially responsible operation.

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