Leading Companies Increase Revenue and Maximize Profitability Through Service Parts Pricing Optimization; Servigistics Provides Best-in-Class Service Parts Pricing Solution

ATLANTA--May 2, 2005--Companies implementing service parts pricing solutions such as Servigistics Pricing can significantly increase revenue and improve profitability, according to a recent benchmark study from research firm, Aberdeen Group.

In the study, entitled "Maximizing Profitability with Optimized Service Parts Pricing," Aberdeen Group highlights the significant revenue and profitability improvements recognized by companies implementing service parts pricing solutions and notes, "Companies employing market adaptive or optimized service parts pricing strategies have seen 13% and 11% increases in service parts gross profit and revenues."

Competing parts suppliers, customer demands and internal pressures to increase profits are fueling the need for companies to switch from their over-used, cost-plus pricing tactics, where service parts prices are derived from a standard percentage mark-up from purchase price, to optimized service parts pricing, where market information and price elasticity help determine optimal selling prices to maximize gross profit.

The study reveals that companies implementing price optimization solutions not only increase profit margins, but also improve competitive position, increase market share and ultimately improve customer satisfaction and loyalty. Furthermore, the study found that companies leveraging service parts pricing and planning optimization tools together are among those earning "best-in-class" titles in their industry, outperforming their competition and "seeing results on the top and bottom lines that dwarf those of companies using outdated tools."

Although there is a recognized need for price optimization tools (83% of the companies surveyed for the study reported that service parts pricing is extremely important to their company's financial health) and an increasing number of leading-edge companies are reaping the benefits from implementing price optimization solutions, many companies remain behind the curve, still relying on spreadsheets for their service parts pricing, resulting in a loss of gross profit, market share and customer satisfaction.

"Today, many manufacturers earn as much profit from post-sale service and parts as they do on initial product sales," said Eric Hinkle, Servigistics CEO. "If these manufacturers ineffectively price service parts, they could be missing out on substantial revenue that could dramatically impact their bottom lines. The Aberdeen Group Benchmark Study is a must read for anyone with P&L, finance or service parts pricing responsibility."

A complimentary copy of the Aberdeen Group Study, "Maximizing Profitability with Optimized Service Parts Pricing," is available from Servigistics at http://servigistics.com/whitepaper6.htm.

About Servigistics

Servigistics is the preferred provider of service parts management solutions that enable companies to transform their global service operations and dramatically reduce cost, increase profitability, and drive customer loyalty to new levels. Servigistics solutions have been deployed and proven globally by market-leading companies in high technology, automotive, aerospace and other industries. Servigistics' clients are 100% referenceable. Servigistics is a privately held company headquartered in Atlanta with offices in London, Tokyo and throughout the United States. Contact Servigistics at 1-888-942-8623 or +1-770-565-2340, via e-mail at info@servigistics.com or at www.servigistics.com.