Build Customer Loyalty - Identify Customer Needs

Buyer orientation - understanding and satisfying your customers - is essential for commercial success. This guide explains how small companies can profit from understanding their customers.

Understanding one's customers is so important that large corporations spend hundreds of millions  annually on market research. Although such formal research is important, a small firm can usually avoid this expense. Typically, the owner or manager of a  small concern knows the customers personally. From this foundation, understanding of your customers can be built by a systematic effort. A comprehensive system for understanding is what Rudyard Kipling called his six honest serving men. "Their names are What and Why and When and How and Where and Who."

What Are Your Customers Really Buying

A seller characterizes what customers are buying as goods and services - toothpaste, drills, video games. cars. . . But understanding of buyers starts with the realization that they purchase benefits as well as products. Consumers don't select toothpaste. Instead. some will pay for a decay preventive. Some seek pleasant taste. Others want bright teeth. Or perhaps any formula at a bargain price will do.

Similarly, industrial purchasing agents are not really interested in drills. They want holes. They insist on quality appropriate for their purposes, reliable delivery when needed, safe operation, and reasonable prices.

Video games are fun. They are bought for home entertainment, family togetherness, development of personal dexterity, introduction to computers, among other satisfactions. Commercial customers include arcades, pizza parlors, and assorted enterprises. They benefit from a potential source of income, a means of attracting buyers to their premises, or perhaps a competitive move.

Similarly, cars are visible evidence of a person's wealth, reflection of life style, a private cabin for romance. Or they represent receipts from leases, means to pursue an occupation. . . Some people even buy cars for transportation.

You must find out, from their point of view, what customers are buying. The common names of products mean as little to them as the chemical names on the label of a proprietary drug. (A sick person's real need is safe. speedy relief.) Understanding your customers enables you to profit by providing what buyers seek­s - satisfaction.

Products change, but basic benefits like personal hygiene, attractiveness, safety, entertainment, and privacy endure. So do commercial purposes such as quests for competitive superiority or profitability.

Successful manufacturers and service establishments produce benefits for which customers are willing to pay. Successful wholesalers and retailers select offerings of such demanded benefits that they can resell at a profit. Successful businesspeople, in other words. understand the reason for their customers' buying decisions.

Understanding What Drives Your Customers

The reason that customers buy is logical from their point of view. Understanding customers derives from this fundamental premise. Don't argue with taste.

Everybody is unique. Each person has individual pressures and criteria. Moreover, perceptions differ. The astute businessperson deduces and accepts the buying logic of customers and serves them accordingly.

To learn why customers buy can be quite difficult.

Some buyers hide their true motivations. In many cases the reasons are obscure to the buyers themselves. Most purchase decisions are multi-causal. Often, conflicts abound. A car buyer may want the roominess of a large vehicle and the fuel economy of a subcompact. The resolution of such mutually exclusive desires is usually indeterminate.

Sometimes the reasons why customers buy are trivial. If customers feel indifferent toward a product or store, the selection is apt to be happenstance. Perhaps several rival offerings meet all the conditions that a purchaser deems important. Consequently, minor factors govern. This explains the rationale of the consumer who chose a $ 22,000 car because its upholstery was most attractive. The point: Pay attention to details. They may be crucial to customers.

Often the best clues are the customers' actions. Shrewd businesspeople respect what people say, but pay special attention to what people do. More important than why customers buy is why former customers have taken their patronage elsewhere and why qualified buyers are not buying. What is now keeping them from buying?

Can this obstacle be surmounted? Businesspeople monitor competitive offerings and buyers' reactions to infer clues. Informal conversations may also reveal some reasons. Special offers may overcome resistance and boost profits.

All the time the manager must be careful to retain the company's regular customers. For instance, a specialty dress shop may try to widen its patronage through a new line at bargain prices. This move could disturb the store's usual patrons. They may take their trade to another store that caters exclusively to their social class.

Many of the dresses were bought for special occasions when projection of a genteel image was important to the customer. Understanding of customers includes awareness of the time of the purchase and use of the merchandise.

Timing is Important

A seller must be ready when the buyer is, lest an opportunity be irretrievably lost. Customers buy when they want an offering and have the time and money to purchase it. Buying patterns can often be discerned from an analysis of customers and their purchases. For example, wants for many consumer goods and services are tied to customers' rites of passage. The following purchase occasions in the adult life cycle are typical:

1. Marriage, separation, divorce

2. Acquisition of a home

3. Change in employment or career

4. Graduate study; running for office

5. Health care, injury, illness

6. Pregnancy, nurture of children

7. Children enter school; graduate

8. Children leave home (for college or permanently)

9. Move to another area

10. Vacations; major social activities

11. Permanent retirement from work

12. Death of a family member.

Shrewd retailers keep track of such key buying events and gain a head start on making sales. Logs of birthdays and anniversaries are a case in point. Additional purchase occasions are impersonal. Seasonal factors include recurring holidays and weather changes. Among other favorable influences on purchases are start of the school year, semi-annual white sales, introduction of new models and clearance of old ones, special price concessions, and improvement in economic conditions or buyer's confidence.

Some of the latter factors also apply to manufacturers. Small plants work closely with their buyers' inventory managers and replenish stock at their reorder point. A current vogue is just-in-time delivery. Interactive computers make replenishment notices routine.

This article Provides managing your Company tips and Handle business advice. But you aren't ready to begin your own business till
you've given any thought to handling it. A company is a continuous activity that does not run itself. As the manager you will have
to set goals, determine how to reach those goals and also make all the required decisions. You'll have to purchase or create your
product, price it, advertise it and market it.

You'll need to keep documents, and determine prices. You will have to Control stock, make the ideal buying decisions and keep
costs down. You'll have to hire, train and motivate employees now or as you grow.

Setting Business Management Goals. Good small business management Is the key to success and good management starts with setting
goals. Set goals for yourself for the achievement of the many tasks required in starting and managing your business successfully.
Be specific. Write down the goals in measurable terms of functionality. Break big goals down into sub-goals, showing exactly what
you expect to achieve in the next two to three weeks, the subsequent six months, the next year, and the subsequent five years.
Beside each target and sub-goal set a specific date showing as it's to be attained.

Plan the action that you need to take to attain the goals. While the effort Needed to reach each sub-goal ought to be good enough
to challenge one, it should not be so good or foolish as to dissuade you. Don't plan to reach too many targets all too. Establish
priorities.

Plan in advance how to measure results so you can know exactly how Well you are doing. This is what's meant by"measurable"
targets. If you can't keep score as you go along you are likely to lose motivation. Re-work your plan of activity to allow for
obstacles that might stand on your way. Attempt to foresee obstacles and plan strategies to stop or minimize them.

Buying. Skillful purchasing is an important essential of Managing a business enterprise. This is true whether you are a wholesaler
or retailer of product, a producer or a service business operator. Some retailers say it is by far the most important single
factor. Merchandise that's carefully bought is easy to sell.

Determining what to buy means finding out the Kind, type, quality, Brand, size, color, style -whatever applies to your specific
inventory - which will sell the very best. This requires close attention to salespeople, trade journals, catalogs, and especially
the preferences of your regular customers. Analyze your earnings records. Even the manufacturer should see the problem through the
eyes of clients before determining what materials, components, and materials to purchase.

Know your regular customers, and also make a good evaluation of the People you expect will become your customers. In what
socioeconomic category are they? Are they homeowners or renters? Are they looking for cost, quality or style? What's the
predominant age category?

The age of your clients can be a prime consideration in Establishing a purchasing pattern. Young people buy more often than many
elderly folks. They need more, have fewer duties, and invest more on themselves. They're more conscious of fashion trends whether
in sporting apparel, cars or electronics. In case you decide to appeal to the young trade only because they appear dominate in
your town, your purchasing pattern will probably be wholly different than if the more conservative middle-aged customers appear to
be in the majority.

Study trade journals, newspaper advertisements, catalogs, window Displays of companies similar to yours. Request advice of
salespeople supplying you product, but purchase sparingly from several suppliers instead of one, testing the water, so to speak,
until you understand what your best lines will be.

Locating suitable merchandise sources is not simple. You may buy Directly from producers or producers, from wholesalers,
distributors or jobbers. Pick the suppliers who sell exactly what you want and can deliver it if you need it. (Distributors and
jobbers are used by most business people for quick fill-ins involving factory shipments.)

You may spread purchases among many suppliers to gain more Favorable rates and promotional material. Or you might concentrate your
purchases among a small number of suppliers to simplify your credit problems. This will also allow you to become known as the
seller of a certain brand or line of product, and to keep a fixed standard in your goods, if you're shopping for stuff for
manufacturing purposes.

When to purchase is essential if your company will have seasonal Variations in sales volume. More inventory will be needed ahead
of the seasonal upturn in sales quantity. As earnings decrease, less merchandise is necessary. This means purchases of goods for
resale and materials for processing must change accordingly.

At the start, how much to buy is insecure. The best policy is To be frugal till you have had enough expertise to judge your wants.
On the flip side, you can't sell product in case you do not have it.

To help solve buying issues, you should Start to maintain stock Control records at once. This can allow you to maintain the
inventory in balance - neither too large nor too little - with a suitable proportion and decent range of merchandise, sizes,
colors, styles and attributes.

Fundamentallythere are two Kinds of stock control - control in Dollars and command in physical components. Dollar controls show
the amount of money invested in each product category. Unit controls indicate the number of individual items when and from whom
bought by category. A good stock control system is able to help you decide everything, from whom, when, and how much to purchase.

Pricing. A lot of your success manage a business will depend on The best way to price your services. If your Rates are too low,
You Won't cover Costs; too high and you will lose sales volume. In both cases, you will not Make a profit.

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