Aftermarket P&Ls Rewired for Circularity (Augmented with ChatGPT-5)

Keynote for global industrial leaders

The room settles. A terracotta slide frames my face.

“I’m Leke Abaniwonda. My thesis today is simple: aftermarket, when rewired for predictive reliability and circularity, becomes your most trusted subscription—one that expands margin, reduces risk, and cuts carbon. And we can scale it in quarters, not years.”

Why this belongs on the main stage—now

Three forces have converged.

1. Services are the profit engine. Across industrials, services average ~35% of revenue and ~60% of profits. Treating them as a strategic P&L—not an adjunct to equipment—changes the growth conversation. Bain

2. Customers are buying outcomes. Equipment-as-a-service and guaranteed-performance deals are moving from niche to norm; Bain’s machinery outlook showed outcome/guarantee contracts rising toward ~30% of deals—because risk transfer and reliability sell. Bain

3. Circularity is becoming commercial. Executives now expect circular business models to lift revenue and resilience while reshaping profit pools; early movers who redesign operating and business models will lead. Bain+1

Implication: the aftermarket is no longer about parts and break-fix. It is about recurring reliability and asset life extension delivered through digital twins, analytics, and reverse logistics—priced as outcomes.

The operating idea: from repair to Reliability-as-a-Service

Event-driven reliability is the on-ramp: use signals you already collect (temperature, flow, vibration) to flag excursions and prevent failures—then graduate to predictive models as the data matures. Firms apply this precisely because it is a stepping-stone that cuts downtime fast without waiting on perfect data. Bain

Layer on the Factory-of-the-Future stack—AI quality, energy-intensity control, and predictive maintenance—and you get a compounding effect: fewer defects, steadier processes, and higher uptime that funds the journey while advancing sustainability. Bain+1

This is the same logic I outline in my Industry 5.0 work: scale what moves the economics and measure it visibly. lekeabaniwonda.wixsite.com+1

The offer architecture (built for CFOs and operators)

1) Uptime subscriptions

• SLA: guaranteed availability or throughput on constraint assets.

• Enablers: sensor fusion, remote service, failure-mode analytics.

• Why it wins: value-based service portfolios are already growing fastest across equipment makers. Bain

2) Circular parts & life extension

• Certified refurb/reman components with core returns embedded in Ts&Cs; reverse logistics designed into the route-to-market.

• Value case: as sectors go circular, profit pools shift—materials and service businesses that close loops earn both resilience and growth. Bain

3) Performance optimization add-ons

• Digital-twin analytics that tune energy intensity, stabilize process windows, and improve first-pass yield—offered as modular subscriptions. Bain

The economics in one slide

• Top line: shift from time-and-materials to recurring outcomes (uptime, energy, quality). Advanced service contracts are expanding share as customers pay for reliability. Bain

• Gross margin: fewer truck rolls and higher parts recovery from reman/refurb; predictive reduces warranty drag. Bain

• Cash & balance sheet: plan for the classic “swallowing the fish” as one-off capex gives way to subscriptions; design bridge pricing and financing explicitly. Bain

• Business model: expect life-cycle economics to change (assets on your balance sheet, new risk profile) as equipment becomes a service. Bain

How we scale (and avoid pilot purgatory)

Quarter 1: One line, one outcome. Start where economics concentrate (the constraint asset or energy hog). Stand up event-driven reliability, launch a circular take-back on your top failure SKUs, and publish a single KPI stack: OEE, unplanned downtime, MTBF/MTTR, spare-parts turns, refurb yield, CO₂e per unit. Then copy exactly to the next line. Bain+1

Commercialize in parallel. Position services as industrial outcomes. Leaders who sharpen aftermarket go-to-market consistently outperform because they treat service mix, pricing, and attach as a true growth engine. Bain

Data discipline, not tool sprawl. Standardize signal naming and failure-mode taxonomies; build the minimal digital backbone that connects plant, field, and service. (Digital, done right, improves both performance and sustainability.) Bain

Governance: the Industry 5.0 test

A transformation is only as strong as its governance. My Industry 5.0 approach hardwires human-centric guardrails—People & Safety Council, AI Quality Council, and a SteerCo that reallocates capital to scale what works. Success is weighed in jobs made safer, skills advanced, EBITDA, and CO₂e per unit—together. lekeabaniwonda.wixsite.com

What you can publish to your board in 6–12 months

• Financial: Service gross margin +300–500 bps; higher cash conversion; NWC down via core returns/reman. (Mechanism: predictive + circular loops.) Bain+1

• Operational: OEE up, unplanned downtime down 30–50%, spare-parts turns up; quality and energy KPIs improve in tandem when analytics run as one program. Bain+1

• Customer: Renewal rate and optimization attach rate rise as reliability becomes the relationship. (Outcome and guarantee contracts continue to gain share.) Bain

• Planet: Circular revenue mix, refurb share, landfill diversion, and CO₂e per unit tracked alongside EBITDA. (Leaders pursue circularity for growth and resilience, not just compliance.) Bain

Closing

“Industry 5.0 is a pragmatic renaissance: human-centric, data-intelligent, and low-carbon. When you rewire the aftermarket for predictive reliability and circularity, you don’t just service equipment—you earn trust at scale.

Let’s pick your first line, your first circular loop, and the first SLA you’ll stand behind. We’ll let the scoreboard—not the slideware—decide what scales next.”

Sources & further reading

• Bain—Industrial Services & Advanced Offerings: services share of profit; GTM for services; event-driven reliability; advanced services momentum; factory of the future; quality analytics; EaaS pricing and “swallowing the fish”; digital solutions model and life-cycle economics. Bain+6Bain+6Bain+6

• Bain—Circularity: CEO expectations (revenue, resilience); strategy in a circular world and shifting profit pools. Bain+1

• My Industry 5.0 lens (external articles): The Anatomy of Industry 5.0 Transformation; Factory of the Future: Scaling What Works—Not Running More Pilots. lekeabaniwonda.wixsite.com+1

—Leke (Lay-k), Industry 5.0 Innovation Consultant & Specialist.