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Scenario 1 : ASC takes AMCs Benefit to ASC: Incentive on taking AMC @20 %

Why should I (ASC) take AMC?. Scenario 1 : ASC takes AMCs Benefit to ASC: Incentive on taking AMC @20 % Claim for resolving AMC complaints equal to warranty charges Cash availability with ASC will improve Scenario 2: ASC does not take AMC Benefit to ASC:

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Scenario 1 : ASC takes AMCs Benefit to ASC: Incentive on taking AMC @20 %

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  1. Why should I (ASC) take AMC? Scenario 1 : ASC takes AMCs Benefit to ASC: Incentive on taking AMC @20% Claim for resolving AMC complaints equal to warranty charges Cash availability with ASC will improve Scenario 2: ASC does not take AMC Benefit to ASC: Service Charge income to ASC – Less royalty ( 30%) Margin on spare sale (20% margin) Risk: All out of warranty complaints may not come to ASC. Complaints might go to outside repairer. Somebody else might take AMC for these products. Customer normally, does not register complaint for minor problems if he has to pay for every visit, but registers complaint even for minor problem if product is covered under AMC

  2. Why should I (ASC) take AMC? Scenario 1 : It is assumed that ASC takes 100 AMCs Scenario 2: ASC does not take any AMC Conclusion: Which is profitable?

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