Customer is King

Members are often the starting point for activities in personnel-owned enterprises. Their goals and reasons for coming together decide if the enterprise pursues to provide jobs for them or to trade in certain lines of business. This creates a solid ground for aiming the activities towards the members’ own goals.

This comes with some weaknesses, though. There is a danger that planning and practices revolve too much around the internal activities of the company. It is a well-known fact that a company survives and implements also the owners’ goals only if it has customers. Especially on the modern market, regardless of the branch, one has to pay special attention to customers.

These days customers, it may be individuals or communities, stand out in a crowd, behave as their own persons, sometimes even quite surprisingly, and this has to be acknowledged. They are an important source of information for the company, and the interaction works both ways.

In this section we focus on the customers from the point of view of both small enterprises and businesses in the service sector. The aim is to create an overall picture of the importance of customers and customer management and also practical tools for that. Furthermore we examine the possibilities that personnel ownership and networking have created in customer thinking.

Different Customers

To understand the meaning of customer thinking one has to start by considering what kind of customers there are. At first, it is worth while to think about this on a general level and then to see, if it works in one’s own business. Different groups of customers require different measures and cause thereby different costs. All in all, also the meaning of different customers on the profitability of the company and especially of its marketing measures is very different. This leads to considering even further the intended actions. Looking at the lifespan of a customer relationship and the maintenance of it through different phases, gives some depth to this consideration.

Present Customers

When we talk about customers, we normally think about the present ones, those that are buying, buy repeatedly or have recently bought from us. As a matter of fact the latter may already do business with another company. This gives very little time perspective or ways to manage the clientele. The company is totally at the mercy of the customer, (who is a closed book), and can only wait when he deigns to come and do business. To reach the customer fairly general marketing is used and the product is a central tool in it.

New/potential Customers

A new customer is, in general, a precondition for growth in the company. It is also an important way to reduce the risk in a situation where just one big customer buys the whole capacity. Getting new customers should be planned and justified in the company. Marketing should be based on customer goals. This makes it possible to plan the capacity, for example in service production so that there is something to sell.

Previous Customers

A previous customer is always an important learning lesson for the company. One should first ask why the customer chose another provider and then look at the activities in one’s own company from this angle. The reason why the customer left elsewhere can be the product itself, its price, quality, availability or merely the fact that the customer was not taken care of properly. The company did not provide a solution that the customer was expecting or the contacts were far too few.

This means that a previous customer is a good source of information but this comes at a price. For the first, the company looses the cover he would provide and for the second, the company has to invest in getting new customers in order to restore the turnover to its previous level. It is always costly to get customers, especially when a run-away customer” is brought back with money”. It certainly pays off to hold on to the present customers.

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ATAKUNTA COOPERATIVE DEVELOPMENT AGENCY

Satakunta Cooperative Development Agency, Sataosaajat Cooperative, Teljänkatu 8 A2, 28130 Pori. Phone. +358 2 633 5095.