What It Means
In this model, someone buys a main product and later buys things needed to keep using it. Think of a razor and blades, a printer and ink, or a water purifier and filters. The main product may be priced low, but it does not have to be sold at a loss.
Why Repeat Sales Matter
Once someone owns the main product, buying matching refills may feel easier than replacing the whole device. That can give the business repeat sales for years. But customers may choose cheaper compatible refills, use other repair services or stop using the product.
What Investors Should Check
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How often are refills needed?
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Do refills earn more profit?
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Can customers buy cheaper alternatives?
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How many devices are still being used?
The Eureka Forbes Example
Eureka Forbes sells Aquaguard water purifiers, along with replacement filters and maintenance services. These can bring in more sales after the first purchase. But customers may also use other service providers or compatible filters.