Overview of Company A’s business model.


The Machine Tool Manufacturer in question, hereinafter referred to as Company A, is headquartered in the USA. The business unit under study is the citrus juice production and maintenance factory, where the company has more than 30 years of experience. This plant manufactures customized production lines for extracting juice from citrus fruits.

Company A operates in the market segment of machines for juice processing and sales. Thus, the type of commercial relationship is business-to-business (B2B). Company A holds 95% of market share in citrus processing machines in Brazil and 80% worldwide. The value it delivers to its clients is the functionality and performance of its machines and the supply of services such as maintenance, forecasting and inventory. Maintenance is carried out yearly at a previously agreed time, at the customer’s site or at Company A’s facilities.

Customer relationships are relational, i.e., characterized by strong relations and proximity between the client and company. The relationship begins with a contract agreement between the company and the client, describing the leasing period, the monthly price and the services to be included. This is followed by delivery of the machine to the client’s facilities. During the use phase, the company’s technical staff work directly at the customer’s facilities to provide services to ensure the machine’s uninterrupted availability to the client.

The key resource of this business is the experience and know-how of the technicians that perform the services. Fifty percent of the company’s 260 employees are allocated to service operations. However, their level of activity varies according to the period of the year, since the maintenance operation depends on citrus fruit harvesting season.

As for its processes and activities, Company A performs almost every task internally, from product development to take back and machine remanufacturing. The only activities that are partially outsourced to partners are services. Service partners service clients located far away from Company A’s facilities. Although product development is performed at the headquarters in the U.S., the company’s Brazilian subsidiary has a product development team dedicated to product and process improvement, working in close collaboration with the American team. Production, distribution and services are performed by Company A, which also oversees the collection of EOL machines. The company carries out all its remanufacturing activities in-house.

Company A’s revenue model is based on leasing with fixed monthly payment schedule, which also includes the supply of services. Service costs are supported by the company and directly influence its profitability. Therefore, major efforts focus on reducing costs by extending the product’s lifetime.

Contact for Germany

Technische Universität Berlin
Institut für Werkzeugmaschinen und Fabrikbetrieb
Pascalstr. 8-9, 10587 Berlin
Thomas Guidat: guidat[at]

Contact for Brazil

Universidade de Sao Paulo
Escola de Engenharia de São Carlos
Av. Trabalhador São-carlense, 400, Pq Arnold Schimidt
São Carlos - SP/Brasil, CEP 13566-590
Ana Paula Barquet: anabarquet[at]