IFS' Cindy Jaudon
Last year, President Biden signed a historic Executive Order to increase competition across US industries by encouraging the FTC to stop manufacturers imposing repairs restrictions. This set the stage for the latest installment of the “Right to Repair” saga. The Fair Repair Bill introduced to the Senate on March 14, if passed, will take the Right to Repair in the US one step nearer to building a sustainable future by codifying legislation on a national level. Manufacturers must make sure they are up to the challenge.
In this bipartisan bill, the widespread support for the Right to Repair across different political groups and industries is undeniable. There are clear implications for the environment and the economy. A prime example would be its impact on electronic and precious-metal waste, which has become a serious problem in the face of dwindling natural resources and global supply chain shocks.
The Right to Repair has gained substantial traction amid from growing environmental concerns and supply chain shortages. This initiative can offer a great incentive for manufacturers to adopt more sustainable business models.
The Fair Repair Bill represents a necessary nationwide effort to move away from fragile linear models, limit reliance on insecure global supply chains, and make US businesses more resilient, as well as, more environmentally friendly.
If the bill becomes law, it presents a critical opportunity for manufacturers to profit by developing closed-loop supply chains and servitization models. Through investing effort and resources into recalibrating design, manufacturing, and aftermarket processes into a circular model, industry will benefit from more efficient resource-utilization and longer-term customer relationships, with all the financial benefits that naturally follow.
The aim of the Right to Repair legislation is to increase competitiveness. Broadening business models to include service offerings after initial sale will help manufacturers to become more competitive in this new business environment. Developing new servitization offerings will help manufacturers transform customer relationships and significantly reduce waste. Double win! But for manufacturers to truly reap the full benefits of a circular economy, they must invest in disruptive technologies that can build new products while developing new forms of long-term customer relationships.
By providing consumers with service after the initial transaction, manufacturers have scope to build a connection with customers that extends far beyond the initial transaction. There are many options open to them—health checks, regular servicing, insurance, etc. The Right to Repair movement is gaining momentum with this new bill; in short, it is providing a springboard for manufacturers to grow.
Cindy Jaudon is regional president, Americas, for IFS
