MRO category’s growth is driven by the rising need to reduce equipment downtime

Maintenance Repair & Operations (MRO) Category - Procurement Intelligence

The maintenance repair & operations (MRO) category is expected to grow at a CAGR of 2.2% from 2024 to 2030. The increasing demand from the manufacturing industries, the high adoption of smart technologies, and the growing requirement to reduce equipment downtime are driving the category’s growth. Companies are increasingly using MRO services to manage their supply chain and inventory efficiently. It is mainly helpful when multiple materials are used in the production process and the absence of any particular material can have a significant impact on production. Robotics is one of the fastest-growing technologies in this category used for improving operational efficiency. It is widely implemented in the industrial, manufacturing, and aftermarket segments. The major applications include single-part repairs, carbon fiber manufacturing, and intricate inspection tasks using miniaturization, which enables robots to inspect components normally difficult for humans to access.

The category is fragmented with a mix of players ranging from spare parts suppliers to national and international-level distributors. MRO often involves a wide, fragmented network of suppliers providing anything from tools, safety equipment, and cleaning supplies. According to industry experts, there is a growth trajectory for aftermarket and maintenance, engineered and machined components suppliers in lower-tier (or, Tier 3) segments in fragmented markets. Companies are increasingly collaborating or collaborating with technology providers to improve their services or expand their product lines.

A few instances of recent developments include:

• In January 2024, Wurth’s division, “Wurth Electrical Wholesale Group” purchased a Poland-based company, TIM SA. The latter is one of the largest electrical materials distributors in Poland. The deal aims to expand and strengthen Wurth’s electrical wholesaling activities in Poland as TIM operates as the largest e-commerce platform in the nation, generating around 70% of revenue through online mediums. Post-purchase, both units under the acquiree-the wholesale and the logistics division-will continue to operate as independent companies.

• In September 2023, Applied Industrial Technologies (AIT) purchased two companies-Bearing Distributors and Cangro Industries. The acquisition will help AIT strengthen its local presence in South Carolina and New York and increase customer access. Both companies will benefit from expanded product lines as they get access to enhanced automation operations.

Labor, warehousing, rent and utilities, technology or IT infrastructure, and overheads. Other costs can include transportation, marketing, legal, or tax. Labor is the largest cost component. IT infrastructure is crucial as it includes elements like engineering systems, computerized maintenance management systems (CMMS), enterprise resource planning (ERP) software, and e-procurement systems that impact costs. A CMMS system allows firms to simplify maintenance operations by tracking equipment, inventory, and manpower. There are multiple pricing models in CMMS such as per-user per-month subscription model, tiered pricing models, and on-time perpetual licensing model. In 2024, CMMS software prices may range from as low as USD 30 per user per month to USD 350 per user per month for more complex capabilities. For a customized CMMS solution, the cost can range between USD 1,800 - USD 20,000. Mid-sized companies spend on average between USD 10,000 - USD 50,000 for a customized solution. Small companies can pay around USD 45 - USD 125 per month for a subscription-based model.

China is one of the most preferred countries for procuring industrial supplies and MRO services. While selecting the MRO service providers, clients should consider a number of factors, including product quality, service, and supplier reliability, years of experience and expertise in the target industry, shipping speed, and shipping costs. Other important considerations, under sourcing, include examining the seasonal patterns of MRO inventory demand and adjusting purchases accordingly.

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Maintenance Repair & Operations (MRO) Sourcing Intelligence Highlights

• The maintenance repair & operations (MRO) category is fragmented. As a result of this fragmentation, the major challenges for vendors include high acquisition costs, poor visibility into demand, and duplication.

• The competitive rivalry is high among players due to low switching costs and industry fragmentation. One of the major barriers to entry among new entrants is information asymmetry as a result of information or data controls and manuals by manufacturers, OEMs, or vendors.

• Labor forms the largest component, accounting for a 40% - 50% share of the total cost structure.

• Some of the other preferred countries for procuring MRO services include Malaysia, Singapore, Turkey, and UAE (Dubai). These nations have consistently established themselves as reliable players in the APAC region. This is mainly due to the favorable government policies and tax incentives, the ability to create viable ecosystems, and the presence of cost-efficient skilled labor.

Maintenance Repair & Operations (MRO) Procurement Intelligence Report Coverage

Grand View Research will cover the following aspects in the report:

• Category intelligence along with emerging technology and regulatory landscape

• Market estimates and forecasts from 2024 to 2030

• Growth opportunities, trends, and driver analysis

• Supply chain analysis, supplier analysis with supplier ranking and positioning matrix, supplier’s recent developments

• Porter’s 5 forces

• Pricing and cost analysis, price trends, commodity price forecasting, cost structures, pricing model analysis, supply and demand analysis

• Engagement and operating models, KPI, and SLA elements

• LCC/BCC analysis and negotiation strategies

• Peer benchmarking and product analysis

• Market report in PDF, Excel, PPT, and online dashboard versions

Cost Intelligence Highlights:

Grand View Research has identified the following total cost components for the Maintenance Repair & Operations (MRO) category:

• Labor

• Warehousing

• Rent and Utilities

• Technology and IT infrastructure

• Overheads

• Others

  • Transportation

  • Marketing

  • Legal or Tax

Labor forms the largest cost component of the Maintenance Repair & Operations (MRO) category.

List of Key Suppliers in the Maintenance Repair & Operations (MRO) Category

• Adolf Würth GmbH & Co. KG

• Air Liquide S.A.

• Applied Industrial Technologies, Inc.

• MSC Industrial Direct Co., Inc.

• Rubix Group International Limited

• Linde Engineering

• ERIKS Group

• Sonepar Group

• WESCO International, Inc.

• W. W. Grainger, Inc.

• RS Group (formerly Electrocomponents plc)

• Critica Infrastructure (Henkel)