Boeing currently sells its airplanes for 30% of its future cash inflow where it could also market in-house products supporting those aircraft over the next thirty years for 70% more cash intake. Boeing theoretically, has a 70% in-house product margin not yet tapped. It could and now has indicated it will seek ways to move more product line to its core mission.
The following are possibilities and actual implementations:
· Global services such as ground maintenance and Boeing staffing.
· Global services such as over-arching training and Boeing proprietary parts supplier
· Exclusive Supplier Contracts
· Providing a third party gateway for major systems replacement such as engines, gearing, and electronics.
· Finally, a nose to tail Boeing product suite.
· Additionally, worldwide added value accessibility for leading-edge Boeing components
These are a wide-ranging list for what Boeing is establishing for its plus 70% business model. Selling an airplane is a gateway into the Boeing airplane business catalog. It may become as simple as going to its electronic interface and selecting a preferred service item and a Boeing representative will confirm the service or add value to an airline own business plan. China is home to multiples of start-up airlines. The Boeing emphasis towards the added value model when buying an aircraft expands a customer’s options for its new ventures. Cash-strapped legacy carriers may also identify high-cost areas of its operations and quickly go to Boeing's 70% portion and pull out a plan that is more efficient so it can remain more competitive.
In other words, the 70% realm is created out of the one-stop shop philosophy. Boeing is changing its business model to accommodate rising airline customers at every stage of its growth and offers already mature airline customers’ options in which to lever its operations on-the-fly. The Boeing goal is to capture the financial potential after an airplane is sold by 70% over its next thirty years while in operation with an airline, at a value less than what the same airline could do on its own. Boeing being aggressive with it one-stop-shop business modeling convincing customers while purchasing a Boeing it is eligible for additional Boeing advantages over thirty Years. The over-arching business plan has a name and its called "The Edge".