Right to Repair: State bills ask manufacturers to open up supply chains

Legislators in eighteen states are proposing right-to-repair laws in response to rising consumer demand for access to parts and repair manuals for high-tech items.

The laws, experts say, could fundamentally change how many manufacturers operate, requiring them to open their supply chain of parts, components and repair manuals to consumers and independent repair shops. Many manufacturers argue against the idea, saying it could pose safety risks, security vulnerabilities and the potential for brand damage.

But with momentum and support for such legislation growing, manufacturers who prepare and get ahead of the curve may boost the customer experience and open a competitive advantage for themselves.

Consumers demand the right to repair

As software and high-tech components drive many of today’s products, repair isn’t always as simple as it was in the past. Many manufacturers currently rely on a system that tightly controls the parts and information to repair their products and the dealers authorized to do so.

Legislators are currently floating right-to-repair bills in 18 states, including New York, Massachusetts, Washington, Illinois and California. That will require manufacturers to make diagnostic information, service manuals and parts available to consumers and independent repair shops.

The growing use of complex software to operate many electronic devices has ultimately created a monopoly on repair, Gay Gordon-Byrne, the executive director of The Repair Association, told Supply Chain Dive. While it’s a boon to many manufacturers, it frustrates consumers and independent repair shops who say they’re forced to replace products that could easily be repaired if parts and information are available.

A report from the International Solid Waste Association says consumers are discarding more electronics and the annual tonnage of e-waste is expected to grow to 52.2 million metric tons by 2021. In many categories of appliances and electronics, lifespan is declining due to the limitations on repair, according to Gordon-Byrne.

“It was so easy and obviously lucrative … If you don’t sell parts then people have to turn around and buy another product. It’s a profound problem,” he said.

While right-to-repair legislation mainly focuses on electronics and high-tech devices such as smart phones, it could ultimately impact all manufacturers with service organizations, according to Gary Brooks, Chief Marketing Officer of after sales service provider Syncron.

“(What) the legislation is trying to do is make manufacturers make the parts, information software, and tools available so individuals in independent repair shops can perform these repairs on their own,” Brooks told Supply Chain Dive.

Many manufacturers don’t support the idea

Motherboard noted in April that Dyson, LG and Wahl lobbied Illinois lawmakers against a right-to-repair bill, arguing the complex nature of today’s appliances calls for trained technicians to ensure they’re properly repaired. Manufacturers have “good points against right-to-repair,” one of which is safety, said Brooks.

“Say a third-party repair shop repairs a piece of heavy equipment using an inferior gray market part and causes a malfunction that results in a personal injury,” Brooks said. “It’s a big issue.”

Manufacturers also express concerns about the potential for brand damage should a consumer or independent repair technician use inferior parts, Brooks said. Consumers can now find third-party “knock-off” parts or components for appliances and devices at Amazon, and in many cases, they don’t always have the best quality.

“If that part’s installed and it fails, it may damage the brand reputation of that piece of equipment, or the brand of the vehicle, not necessarily the part,” he said.

Turning right to repair into a competitive advantage

The growing momentum behind right to repair is likely to soon make it a reality, Gordon-Byrne said.

After a long fight against right-to-repair in the auto sector, automakers eventually agreed to a deal in 2014 that required them to make available their diagnostic codes and repair data to independent shops by the 2018 model year. In return, lobbying groups for parts retailers and repair shops refrained from pushing for individual state legislation.

Organizations that get ahead of the current right-to-repair legislation and move to these models may gain customer goodwill and a competitive advantage in the process.

Manufacturers will primarily have to optimize their after-sales service portions of their business with speed and efficiency at the forefront, Brooks said. The most forward-thinking manufacturers are already optimizing their service businesses to be more efficient, secure parts and perform repairs for consumers as quickly as possible.

Such processes are critical at a time when consumers are accustomed to instant service, rapid fulfillment and things like next-day shipping. Forcing consumers to wait three weeks on a part or service will no longer suffice in the coming years. “These expectations are being transferred to the original equipment manufacturers,” said Brooks. “(Consumers) just expect things to work, and when they fail, they expect them to be repaired very quickly.”

The right to repair will also greatly influence the parts market, indirectly forcing manufacturers to competitively price their parts and ensure they can move quickly through their supply chain when needed.

Many manufacturers will have to move from outdated methods like spreadsheets and cost-plus to modern parts pricing technologies that pull from multiple providers to get parts to consumers at the right time for the right price.

Smart sensors and IoT can help manufacturers better predict when parts or equipment might fail or need repair, enabling the manufacturer to more quickly respond to a failure or even pre-empt it, Brooks said. In this new environment, manufacturers will ultimately have to reinvent their service operations with new technologies, cloud-based solutions and processes that can optimize service parts inventory levels while maximizing product uptime.

“This transformation or disruption is already happening behind the scenes,” Brooks said. “Many [manufacturers] are already moving to completely different business model.”