Rivalry Intensifies In Spare-Parts MarketRivalry Intensifies In Spare-Parts Market

Servigistics has won $18 million in a third round of funding it intends to put toward a marketing and sales campaign against Xelus, its major rival in the emerging market for supply-chain planning, forecasting, and optimization software for the service-parts industry. The round was led by Bain Capital Ventures.

Xelus has "done the pioneering work in this space, but we have our own value proposition," says Mike Landry, Servigistics' president and CEO, who says the Atlanta company's software is Web-based and allows for rapid deployment. "There are 8,000 service organizations in the country and the market is wide open," Landry says. Aerospace, automotive, and IT companies are among those that find service-parts availability planning particularly tricky.

"With the downturn in the economy, optimizing service revenue becomes even more important to companies," Landry adds. "Customers might put off buying a new piece of equipment, but that means they can't afford to put off repairing a broken one," which often requires replacing parts.

Servigistics intends to go into service-parts supply-chain execution and logistics, where Xelus also plays a significant role.