Striving for a more sustainable revenue base, Bosch Group awards its most inspiring lighthouse projects based on annual recurring revenue. BSH’s Service Brand BlueMovement is one of eight awarded projects in 2021. Discover why this makes our CFO Gerhard Dambach proud and how it resonates with BSH’s sustainability approach.

What do corporations need to become economically robust while increasing the quality of revenue and profitability in a sustainable way? There are many answers to this, but one proven way is to increase the share of annual recurring revenue (ARR). This is why the Bosch Group awards its most inspiring lighthouse projects based on annual recurring revenue – in 2021 for the first time.

One of the eight award-winners this year is BSH’s Service Brand BlueMovement. What incredible news! 

Why is ARR important?

“ARR combines several of our targets”, says BlueMovement Finance Lead Daniel Mattersteig. “With the generation of sustainable recurring revenue, we increase the predictability and lower the volatility of our business. Therefore, ARR makes us even more economically robust. Furthermore, the focus on maximizing customer value by offering services instead of pure hardware enables us for revenue and profitability growth.”

However, ARR business models do not appear out of the blue. This is why the Bosch Group has just started to award and promote the most inspiring lighthouse projects based on ARR. The target is to successively increase the share of annual recurring revenue from currently 1% to 10% in 2026 while the selected lighthouses play a significant role when it comes to reaching that goal. Besides that, they serve as role models, which can offer valuable insights for other business models across the Bosch Group. 

Why BlueMovement?

As of 2017, BlueMovement aims to make consumers’ lives more carefree, sustainable and affordable by renting highly efficient home appliances for a fix monthly fee. With its rental model of home appliances like washing machines, washer dryers, dryers, fridges and dishwashers, BlueMovement has a proven record of accomplishment for successful business with recurring revenue.

BlueMovement’s unique business model brings together different strategic priorities of BSH. For example, it combines accelerating the business directly to the consumer (D2C), adopting a strong consumer focus, competitiveness, as well as simultaneously being a role model in sustainability. 

“It comes as no surprise, that BlueMovement has been awarded for its successful business model”, says CFO Gerhard Dambach. “The team has done an incredible job in the past couple of years and established BlueMovement as a successful, sustainable and future-proof business model in the Netherlands. Consequently, I am very curious about BlueMovement’s next steps.”

“It comes as no surprise, that BlueMovement has been awarded for its successful business model. The team has done an incredible job in the past couple of years and established BlueMovement as a successful, sustainable and future-proof business model in the Netherlands. ” says CFO Gerhard Dambach.

How is it sustainable?

All of BlueMovement’s appliances are highly energy-efficient, so consumers can save costs and help reduce carbon emissions. After their first use when a consumer cancels the rental contract, appliances are taken back, refurbished and reused at a new consumer’s home to maximize the appliance lifetime and reduce resource consumption.

As a target scenario for the future, BlueMovement is aiming to reinstall working components of broken appliances in a new loop if the appliance itself is not reparable. Moreover, in case an appliance reached its lifetime either gaining spare parts or raw materials is the ultimate target to keep used materials as long as possible in use. Once BlueMovement reaches this state, the principle of a circular economy is fully implemented.

Ultimately, this saves resources, fosters re-use and avoids appliances ending up as waste in landfills. Using a refurbished or repaired appliance instead of buying a new one saves resources since it extends the product’s service life.

What comes next?

Talking about the next steps: Already in May 2021, BSH will also roll out this sustainable business model in Germany. Further rollouts in other European countries might follow as well.