So James is a friend to Bose the owner of the beverages store just across the street. Tony also owns a beverage store right next to Bose’s. However, James dutifully ALWAYS buys from Bose.
One day, Ade, James’ new chick, finally visits him. The sun is scourging, and a chilled bottle of coke needed to be summoned to the rescue. James dashes to Bose’s to buy one. But, hers were newly stocked and not chilled. Clearly, it won’t do for the occasion. From where he stood, James could see the Coke bottles snuggling inside Tony’s refrigerator, sweaty chilled and totally inviting.
Question? If you were James, what will you do?
Buy from Bose nonetheless, and put your guests, pleasure in jeopardy? Or Stroll over to Tony and get the colder version, knowing it is only business? Of course you’d stroll to Tony and buy his ‘ready-to-deliver version. Next time, Bose should be better prepared.
This begs, the question;
What do you do when you’re faced with meeting a monthly production target for a growing client base? When you seem to have more orders than you can possibly satisfy? Do you turn them off with a promise of delay in product delivery, or do you quite simply just lose the customer? This is the risk you run every time your order is more than the production. This can become a real challenge, especially when your marketing activities have been great. Now you are unable to adequately meet your customers’ orders. And you know this is bad for business in the short and long term. The risk is higher with new (or intending) customers, especially where they are just here to try you out.
Customer’s loyalty is overrated! They care more about being satisfied quickly than they care about the brand satisfying them. So, even in a market where you dominate or have your personal touch converting deals for you, it is important to always meet your customer’s needs in time. Help them buy easily from you with a full stock. Imagine where you are the customer, would you stay with a slow producer, even if he is close to you?
As a businessman (who produces his own products or services), you HAVE to always have a full stock. The trouble with this however is you run the risk of wastage where customers’ purchasing power drops or less sales are recorded. What do you then do, to ensure your customer’s demands are satisfied, and potential wastage averted?
The solution is to run your entire production process on a predictable operational system.
These four steps will help you:
- Determine your daily or monthly production quantity demand, based on market and sales projections and forecast.
- What amount of resources are needed to meet the market demand? Determine this in terms of the materials, time and human resources need.
- Break work to be done down to tasks individuals can handle. Set timelines, production milestones, etc.
- Set measurement timeline, including rewards for work done (including punishments, etc. for work not done).
When you move your entire production to run on predictable timeline, you will only need to monitor and control the timeline and meet your regular business production target.
The only businesses spared are the internet businesses where you sell e-products. For this however, you still need to clearly define your delivery system to ensure customers consistently stay with and buy from you. When a customer finds difficulty in buying your product, or have to go through too many bureaucracy just to purchase an e-product, he will likely go elsewhere for the same product. So put in the right place, business systems that ensures the customer is just a button away from purchasing, and the same button away from taking delivery of the e-product when bought.
What type of business do you run?
What types of system(s) govern your production and delivery lines?