INTRODUCTION

Q u a l i t y, p r i c e , a n d s e r v i c e a r e t h r e e f a c t o r s
are critical to the success of any export sales effort. Quality and
price are to essential factors. Service is the important factor
which in detailed is explained here. Service should be an integral
p a r t o f a n y c o m p a n y s e x p o r t s t r a t e g y f r o m t h e s t a r t . P r o p e r l y
handled, service can be the foundation of growth. Ignored or left
to chance, it can cause an export effort to fail.
Service is the prompt delivery of the
product. It is courteous sales personnel. It is a user or service
manual modified to meet your customer s needs. It is ready access
to

service

f a c i l i t y.

It

is

knowledgeable,

cost-effective

m a i n t e n a n c e , r e p a i r, o r r e p l a c e m e n t . S e r v i c e i s a l o c a t i o n . S e r v i c e
is dealer support.
Service varies by the product type, the
quality of the product, the price of the product, and the distribution
channel employed. For export products that require no service -such
as

food

products,

some

consumer

goods,

and

commercial

disposables the issue is resolved once distribution channels,

quality criteria, and return policies have been identify
On the other hand, the characteristics of consumer durables and
some consumables demand that service be available. For such
p r o d u c t s , s e r v i c e i s a f e a t u r e e x p e c t e d b y t h e c o n s u m e r. I n f a c t ,
f o r e i g n b u ye r s o f i n d u s t r i a l g o o d s t yp i c a l l y p l a c e s e r v i c e a t t h e
forefront of the criteria they evaluate when making a purchase
decision.

Al l f o r e i g n m a r k e t s a r e s o p h i s t i c a t e d , a n d e a c h
has

its

own

manufacturers

expectations
or

of

distributors

suppliers

must

and

therefore

vendors.

ensure

that

U.S.
their

service performance is comparable to that of the predominant

competitors
important
position,

in

the

market.

determinant
given

the

This

level

in

ensuring

other

factors

of

of

performance

reasonable
product

is

an

competitive

q u a l i t y,

price

p r o m o t i o n , a n d d e l i v e r y.
An e x p o r t i n g f i r m s s t r a t e g y a n d m a r k e t
entry decision may dictate that it does not provide after- sale
service. It may determine that its export objective is the single or
m u l t i p l e o p p o r t u n i s t i c e n t r i e s i n t o e x p o r t m a r k e t s . Al t h o u g h t h i s
approach may work in the short term, subsequent product offerings
will be less successful as buyers recall the failure to provide
e x p e c t e d l e v e l s o f s e r v i c e . As a r e s u l t , m a r k e t d e v e l o p m e n t a n d
sales expenditure may result in one-time sales
I f t h e a p p l i a n c e i s c o v e r e d b y w a r r a n t y, yo u
will generally need to have repairs done by the company specified
o n t h e w a r r a n t y. O n c e t h e w a r r a n t y h a s e x p i r e d , yo u m a y o r g a n i z e a
c o m p a n y o f y o u r c h o i c e t o d o a n y r e p a i r w o r k . B u t i t s o f t e n w i s e r
t o c o n t a c t t h e s e r v i c e d e p a r t m e n t o f t h e m a n u f a c t u r e r, o r s e l e c t a
service firm with which you or your friends have had successful
dealings.

C U S TOM E R S E RVI C E
End users of many types of product,
r a n g i n g f r o m c o m p u t e r s ys t e m s t o d o m e s t i c a p p l i a n c e s , r e q u i r e
customer

support

at

some-time-

assistance

to

help

them

gain

maximum value from their purchase. In fact customer support

entails all activities to ensure that a product is available for
trouble-free use to consumers over its useful span
The concept of customer service has been a generic term used by
industry and academia to describe a set of activities in which a firm
engages to win and keep customers. Simply differentiation of
customer service refers it to a variable that expands the image of a
product and thereby offers the possibility of market dominance.
In this prime role, customer service is
viewed

as

an

organized

corporate

philosophy

consisting

of

c o m p r e h e n s i v e a n d r e l a t e d s e t o f a c t i v i t i e s . S p e c i f i c a l l y, c u s t o m e r
service is not generic abstraction, but rather a series of specific
services prior to the transaction, as timely deliveries, efficient
telephone handling of orders and queries, accurate purchase
statements,

and

users

receive

customer

service

not

in

some

abstract sense, but as the availability of an item, after-sales

services

and

back-up,

competent

technical

representatives,

demon-station of equipment or special product promotions.

While there is broad agreement that these elements are commonly
associated with customer service, the degree of importance attached
to each respective service varies from industry to industry and
company

to

c o m p a n y,

depending

on

customer

needs

and

the

capability of the service- providing organization.

There are two aspects of customer support,
which particularly deserve management attention. First, there is

need for customer support requirements to be fully considered at a

design

stage

using

what

are

called

design

for

supportability

techniques- in order to develop products, which are economical and

easy support. Second, the logistic of delivering customer support
t h r o u g h s u i t a b l e c h a n n e l s i s k e y. C o m p a n i e s , w h i c h a r e g o o d a t
both of these aspects have differentiated themselves from their
competitors and won significant market share.
Ac c o r d i n g t o E p p i e n t t e , c u s t o m e r
service has been emerging as a competitive weapon for business
firms. He mentioned it is becoming harder and harder to compete
on

manufacturing

excellence

alone.

Manufacturers

who

thrive.will compete by bundling services with products. Of

course use of customer service, as a form of competition does not
a p p l y t o m a n u f a c t u r e r s . Wit h t h e e c o n o m y b e c o m i n g i n c r e a s i n g l y
s e r v i c e b a s e d a n d n e w k i n d s o f s e r v i c e b e i n g o f f e r e d c o n t i n u a l l y,
t h e i n p u t o f c u s t o m e r s e r v i c e m a y b e e v e n m o r e d yn a m i c f o r n o n manufacturers. It is probably safe to say that, in one form or
a n o t h e r , a l l b u s i n e s s i s c o n c e r n e d w i t h c u s t o m e r s e r v i c e . As e a r l y
a s 1 9 7 2 , i t h a s b e e n n o t e d t h a t e v e r yo n e f r o m b a n k i n g a n d a i r l i n e s
to product-related services and the sales related services offered by
m a n u f a c t u r e r s a n d r e t a i l e r s . O b v i o u s l y, c u s t o m e r s e r v i c e i s a p a r t
of all facets of our economy and is especially important to the long
term survival of companies.
The importance of customer service will be
more recognized when Michael porter (1980) considers it has a
p a r a m e t e r f o r h i s v a l u e - c h a i n a n a l ys i s m o d e l t h a t m a k e m a r g i n f o r
c o m p a n y. Ac c o r d i n g t o t h i s a n a l ys i s , w h i c h i s s h o w n i n t h e f i g u r e ,
a l l t h e a c t i v i t i e s o f t h e e n t i t y a r e m a p p e d i n t o a v a l u e a r r o w. T h e
right side of the arrow represents total value created by the
organization; in a competitive market, that is what the customer are
w i l l i n g t o p a y, i . e . r e v e n u e . To c r e a t e t h o s e v a l u e s , c o s t s a r e
incurred; the difference between revenue and costs is the margin.
4

To i n c r e a s e t h e m a r g i n , t h e e n t e r p r i s e c a n , f o r e x a m p l e i n c r e a s e
value

for

customer

(primary

activities

are

inbound

logistics,

operations, outbound logistics, marketing and sales, and continuing

service.
Good customer support is prerequisite for
achieving customer satisfaction; it can increase the success rate of
new products and directly contribute to competitive advantage. In
addition, it can be a major source of revenue for manufactures. In
fact the total worldwide market for high tech support is estimated
at $ 400bn and the importance of support revenues to manufacturing
companies in a range of industries has been identified. Over the
work lifetime of a product, the support revenues from customer may
be

far

higher

than

the

initial

product

revenue.

Despite

the

importance of customer support as a source of both revenue and

profit, it is an area that has often only received scant attention
from managers.

Value Chain Analysis (porter)

Service is valuable for rescuing cost, which finally
increases companys profit. Many high- performance companies consider service a
vehicle for reducing costs for customers. While many organizations have streamlined
operations or practiced some from of just- in- time production to reduce costs,
relatively few companies look at one of their biggest cost-saving tools: their service
providers. For years, the Japanese have been training bright, knowledgeable service
they receive from customer every day.

THE IMPORTANCE OF AFTER SALES SERVICES

The importance of after sales services both at the
consumer/industrial markets.
Historically, after-sales service was regarded in most manufacturing companies as a
necessary evil - as a supporting but relatively minor function in the overall structure of
the organization. This also applies in some degree to the channels - in the case of
industrial products, it will usually be the manufacturer who provides service, whilst for
many consumer and other types of goods it is the responsibility of the retailer, dealer
or agent. While it was realised that it was important to provide a reasonable level of
after-sales service, the role and function of service was generally viewed purely as a
cost centre. It may well have been the last area for development and investment in
many organisations. Changes came about as a result of increasing consumer pressure
and more intense competition. As consumers grew more sophisticated, they became
less willing to accept poor quality goods and services. Consumer protection legislation forced firms to take responsibility for after-sales service, but, at the same time,
organisations started to realise that by offering guarantees and service warranties they
could enhance their competitive position. This applies not only to providers of actual
goods but toservice providers as well. If insurance organisati0ns failed to deal with
queries and claims promptly their customers might switch insurers. If a tour operator
promises trouble-free travel and then problems arise (even if they are the fault of an
airline or hotel), the tour operator must take steps to rectify the problems immediately.
Bad publicity resulting from poor after sales service can be the fastest way of losing
custom.
A Service-orientated ApproachSome companies anticipated this, and invested in aftersales service consistently. They were able to establish a leadingcompetitive position
based on their repu-tation for fair and unparalleled service. Marks and Spencer, the
leading high street retailer in the UK, was providing instant money-back guarantees
long before its competitors followed suit. In the market for photocopying equipment,
which is notorious for breaking down, Xerox, a leading manufacturer, advertises the
fact that wherever their customers are located, throughout the whole of the USA, they
are never more than three hours away from a service engineer.

In the last few years there has been increasing corporate awareness of the strategic
importance and value of service both as a profit centre and as a marketing tool. As this
awareness has become established, there has been a considerable increase in the
resources being made available to maximise its value to theoverall profitability,
directly and indirectly, of the company.It would be hard to imagine buying a car, a
washing machine, or any other major purchase without some form of guarantee that
long-term service will be available promptly.
After-sales servicehas been part of the augmented product for so long now that it
is no longer a special feature - consumers demand it.

AFTER SALES SERVICE: BRINGS EVERYTHING UNDER ONE ROOF

The last decades have seen a growing trend towards
aggressive global competition, increased marketplace demands, and accelerated
technological changes. These developments are forcing organizations to take closer
look at their products and offer associated after sales services support. MANY
VALUE-COSCIOUS CUSTOMERS are demanding that a companys product offer
mare value than its competitors product not only in design and manufacturing, but
also in product delivery and support. Increasingly, distribution and services support
options available for a product are key determinations in consumers product purchase
decisions.
Product sales and distribution issues typically involve
specific mechanism for a pricing product and distributing it to the end customer. On
the other hand after sales service support issues entail all activities undertaken by
service support providers to ensure that a product is available for trouble free use to
customer over its useful life span. Management experts and marketing channel
analysts alike agree that distribution and after sales service support functions do
increasingly warrant significant attention because they make for an integral part of the
product package.
Today competitive market cause that many company re-evaluate their
strategy to more differentiate from others. After sales service is one of the elements,
which help all firms in this matter. Many new breeds of high-tech companies are now
discovering that they need to differentiate themselves from rivals in appealing to
9

customers and that technology alone will not do anymore. After sales service being
recognized as one of the competitive differentiators for most firms, which now
produce in the same low cost regions of the world.
After sales service acts as a strong marketing tools, which
help firms to be competitive in the market. Service is proving to be a source of
competitive advantage that enables firms to remain leaders in a highly competitive
market, the outcome of an inadequate balance between the different parties involved in
the service chain marketing, sales, R&D, production, supply, after sales etc. This may
lead to internal conflicts which progressively intensify, thus reducing the effectiveness,
and profitability, of direct and indirect after sales support activities.

An essential part of marketing strength is service support. When customers

buy a product, they expect certain levels of post purchase support to go along with it.
Defining those expectations is critical to marketing success and will be even more
important when markets mature.

However, industry experts caution that too many companies mismanage the

total cost of providing superior after sales service support and so undo part of the
competitive edge won via technology and pricing.

Customer support, which is also referred to as product support, after sales

service. Technical support, or simply service, its important for because it:

Can be a major source of revenue although it often receives too little

management attention.

Is essential for achieving customer satisfaction and good long term

relationship as identified by number of researchers.

Can provide a competitive advantage. This is a true most high- tech

industry but also in some low- tech sectors. As product differentiation becomes harder
in many markets, companies are increasingly looking to customer support as a
potential source of competitive advantage. A number of examples of how companies
have own market share through good support can be found in trade press.

Play a role in increasing the success rate of new products.

Needs to be fully evaluated during new product development, as

good product design can make customer support more efficient and cost effective.
Increased competition within many industries has lead to increased attention on
customer service. Various studies indicate that upset customers may have big effects

10

on sales of company. Therefore, all firms try to put all their attentions to keep their
customer satisfied and fulfill their needs and wants as much as possible. One of strong
tools which help all companies in this matter is providing best after sales service.
Service is traditionally has been considered a post-sale capability, primarily focused on
problem resolution or providing technical assistance. Now, these definitions are too
limited. Customers whether internal or external consider service a collective,
organizational responsibility rather than a functional or departmental one. As the
relationships customer has with company continued to widen, anyone who interacts
with a customer is in a position either to jeopardize or to enhance the relationships. To
ensure customer quality service, every person who interacts with customers anyway
must have appropriate skills to respond, efficiently and effectively, to customer needs.
Providing good and reliable product, which is another main target of each company
can be achieved by good after sales service. Increasingly, after sales service- customer
service is becoming the order- widening criteria for most firms and is now being
recognized as an important research priority. According to a major study conducted by
the conference board, the primary rationale of the manufacturers for offering after
sales service adds the products value and is often treated as integral part of the
product.
Proper after sales service helps companies in customer retention too.
Many companies have begun to align entire organization to deliver excellent service,
since they know their investment will pay off terms of competitive advantage and
customer retention.
Customer long term retention will really help companies to be more
competitive in the market and enable them to implement their entire marketing plan.
The recent and ongoing changes in the business environment most notably escalating
competition, increasing globalization of markets, and more demanding customers- are
making it difficult to compete effectively on the basis of traditional marketing mix
variable alone. This is reality perhaps the primary impetus for the increasing attention
that relationship marketing has been receiving from both practitioners and researchers.
And, given that long-term customer retention is a key aim of relationship marketing,
the focus is now shifting from merely to customer to serve ,
After sales service is often in response to a customer problem, e.g.
product failure restoration, problem diagnosis, expert assistance to resolve a problem,
problem with using the product, etc. therefore after sales service is a recovery process
11

that attempts to resolve a customer problem, which, if not resolved causes

dissatisfaction and less satisfied customer. The service functions therefore attempts to
recover the customer satisfaction to the level it was before the occurrences of
problems.
The implementation of a superior service strategy strongly depends
on the attitude and behavior of customer contact personnel in service organizations.
However, conflicting demands of organizational constraints, service managers, service
teams, and customers frequently lead to role stress of service employees. In this
article, the authors investigate antecedents and consequences of role stress experienced
in after-sales service management of an international office equipment manufacturer
from a longitudinal perspective. Empowering service employees by giving them
authority and responsibility decreases their sense of role stress and, at the same time,
enhances job satisfaction. Moreover, the authors notice a negative short-term and a
positive long-term effect of the presence of rules and regulations. In the short term,
this leads to higher role conflict. Finally, on the basis of the positive lagged effect of
perceived group cohesiveness on role ambiguity, the authors conclude that creating
"tight-knit" workgroups can actually prove detrimental because the norms they
develop might be hard to change.

12

THE IMPORTANT EFFECTS OF AFTER SALES- SERVICE

Finally, we may see the main important effects of after sales
services in improvement of each firm, which expressed the four main important
aspects of after sales service as follows:

First, service perceived as high- profit, high- growth

opportunity with profit margins for equipment sales under pressure from foreign and
domestic competition, many U.S firms target after sales service as a key area for
investment, a sharp contrast to its historical image as a backwater meriting little
attention from top management.

Second, managers are also beginning to realize that

customers will buy more often and more quantities from a company they feel will
support them and give maximum post sales satisfaction. After sales service, therefore,
is an important aspect of a companys marketing mix to build loyalty and repeat
business. The market is a crucial ingredient for success in international marketing.

Third, companies are also realizing that technological

and feature advantage is short lived. The rapid diffusion of technological change
makes it increasingly difficult to maintain a competitive advantage based on product
features or design. As a result, both customers and manufacturers focus on service as
the key differentiator. Moreover, firms abilities to provide service support have
increased significantly.

Fourth, customer expectations are increasing and buyers

today are demanding ever- higher level of service support. Customer expectations will
create opportunities for innovative products that meet changing service support needs
and will increase competitive pressures to continually improve product reliability and
serviceability. They will make conventional service contracts and endangered species,
force manufactures to unbundled the prices of the product and support service, and
create major profit squeeze in the key segment of such information age industries as
telecommunication, computers, and office automation.
In spite of all above advantages, which push distributors
provide after-sales service there some other reasons are that justify not relying on
suppliers services only and having local after sales services. An important aspect of

13

customer support organization, or use third parties. If customers are to be provided

with good product support, company need to select and effectively manage their
distribution channels. Manufacturing companies may have their own direct
organization for customer support, or they may use alternative. The review of the trade
and popular management press confirmed the importance of good distribution
In coordinating distribution channels through contractual
arrangements; manufacturers must deal with retailers who compete not only in price,
but also in important non-price factors such as in- store services; after sales support or
faster check out. Coordinating the price and non-price competition among retailers
can be a difficult task.

14

DIFFERENT WAYS OF AFTER SALES SERVICE SUPPORT

There are different ways of after sales service support for most of
firms and manufacturers which has to be selected: (as per Arvinder {1996})

Offering it directly at the factory

Through their own network of service centers

Through channel distributions

Through authorized independent and third party service centers

By some combination of these organization

For long time, the manufacturers preferred to use either the first

or second above methods. Distributors only had responsibility for selling the products
in local markets and after sales service were handling through manufacturers. But this
method is no longer useful. It was likewise noted foreign customers have not received
effective service from their suppliers the tendency has been to leave the
responsibilities to the importer in the host country.
Besides local competitors have a natural advantage in their
ability to provide such services in their own domestic markets, they can use high
quality after sales services to augment their product, and increase value and quality
perceptions of their products. This natural location advantage allows local competitors
to parlay quality after sales service into competitive advantage relative to foreign
competitors.
There is another classification, which introduced by GOFFIN
(1999). In this he states that there are 5 main choices for customer support distribution
channel and companies need to determine the best combination to meet their need and
customers requirement as:

Direct support from the factory

A direct after sales service network
Channel intermediaries
Authorized, independent third parties
Some combinations of the above possibilities
15

For selecting one of the above methods, either direct from factory,
local support service or third party, companies have to consider other environmental
factors. More complex products usually require more support and therefore
manufacturers will normally want to exert maximum control over customer support by
having their own direct customer support organization. They also identify the
limitations of particular distribution channels. For e.g. the high cost of a direct
consumer support channel and the lower degree of control resulting from indirect
channels, such as dealers.
The demand for service support in a distribution environment has steadily increased in
recent times and can be another reason for distributors to have their own local after
sales service support. This trend can be accounted for by several factors:

Products are now more complex and, therefore, more service sensitive

Greater customer awareness of rights regarding warranty servicing;

Inflationary pressures creating greater sensitivity to repair costs;

Decline in product consistency as well as instances of poor design;

Inexperienced and unqualified personnel maintaining and servicing product;

Increased, incidents of product misuse by the customer.

16

After sales services necessity and effectivness

Proper and effective after sales service

After sales service methods:

Installation
Training
Documentation
Maintenance
Online support
Warranty
Upgrades

Parts supply

Software service

Goffin
(1999
&
2000)

Timo
thy
(1999
)

17

KEY ELEMENTS OF AFTER SALES SERVICE

Providing the pro [after sales service is very important
for firms and customers. Traditionally, support merely constituted maintenance,
service and repair.
However, as the scope of product has broadened over the past
decade, it has also included such aspects as installation, commissioning, training,
maintenance and repair services, documentation, spare parts supply and logistics,
product upgrading and medications, software, and warranty schemes, telephone
support, etc
An after sales support strategy associated with a product may
include elements such as warranty provision, extended service contract provision,
availability of repair service, loan availability, toll-free phones support, etc
According to gulden (1997), after sales service consists of number of elements or
dimensions. It is conceptualized as consisting of the following:

The installation and start up of the purchase product

The provision of spare parts for products

The provision of repair services

Technical advise regarding the product

The provision and support of warranties

Seven elements of the after sales service support which must be provided to customers
over the working lifetime of products as follows:

Installation:
For many products, the first elements of product support
following the sale is installation. This is usually performed for complex products (e.g.
computer systems or dish TV) where safety issues are involved (e.g. medical devices)
by personnel from the manufacturing company, or their representatives. Increasingly,
where product design allows it, customers themselves will install their purchases and
manufacturers make the challenge face making this installation is that IBM recognized
in 1990 that their personal computer customers wanted to be to unpack their purchases
and have them running quickly. This led to products with pre installed s\w and which
consequently could be unpacked, assembled, switched on and in use within 5min. each
18

can be an important considerations in sectors such as networking products, or

computer systems.

User training:
The complexity of some types of equipment necessitates that manufacturers
provide good training for users. For e.g. hospital staff needs to well train in the use of
critical care devices and the successful implementation of process innovations, such as
new manufacturing equipment, depends on extensive training being given over a long
period. Many computer based products include functions which help users learn to use
them more efficiently; these can range from single help functions, to full training costs
can be still be very high business users have to invest significant amounts of money in
training their employees in efficient use of personal computers. For simpler products,
training is not necessary and details of product operation are usually given in user
documentation.

Documentation:
Most products have some formed of documentation and industries
such as medical electronics it plays key role. Typical forms of documentation cover
equipment operation, installation, maintenance, and repair. Good documentation can
lead to lower support costs and increased products are poorly written and hard to
understand. New technology is being applied to documentation and, for e.g. CDROMS are making car services efficient.

Maintenance and repair

Historically, maintenance and repair has been an important element of
product support, which has required companies to invest significant resources. For e.g.
an estimated 500,000 car mechanics are employed in the USA. if equipment fails, fast
and efficient repair is essential in many markets because down-time costs run
typically at anywhere from 100 to 10,000 times the price of spare parts or service. In
markets where products failure has strong implications- for e.g. computer systems for
financial institutions companies need to offer either equipment, which is very
reliable, or a rapid response to expedite repairs. One way to achieve a fast response is
to provide customers with loaner equipment in the event of breakdowns, where this is

19

feasible. Another strategy for maintenance and repair is to design disposable products:
the approach used by some companies for watches, torches and other products. Where
repair costs do not exceed a significant percentage of product replacement costs,
having repairable products is the best strategy for companies. For repairable products,
it makes sense for companies to develop good diagnostics-efficient means to test
problems and identify the causes. However, where products are becoming less viable.
In order to repair faulty equipment, companies need to have efficient logistics for the
management and movement of spares, the parts used in repairs. Some companies have
focused strongly on this area, to gain an advantage over their competitors.
Maintenance also referred to as preventive maintenance is
undertaken to clean, refurbish or replace parts of equipment which otherwise would be
liable to fail. Mechanical parts, for e.g. normally require regular maintenance as in the
case of cars. In the computer sector, where fewer mechanical parts are involved,
remote support technology enables computers to be updated diagnosed
and repaired by linking them to manufacturers support center via telephone lines. The
US earth- moving equipment manufacturer caterpillar, which focuses on product
serviceability products that are easy to maintain and repair is using similar
approaches. This has led them to develop products, which can be remotely monitored
so that maintenance can be performed before fault occurs.

Online support:
Telephone advice on products is a major element of customer
support in many industries. Product experts give online consulting to customers to
help them use products more efficiently or, sometimes to trace the cause of
(troubleshooting). Whenever problems can be solved over the telephone, costs are
much lower than an engineer having to visit the customer site. Online support is
particularly strongly utilized for software products (software support). For e.g.
companies such as Microsoft have invested significant resources in telephone centers
and support costs are typically 6 percent of revenues in the software industry. Many
software products can now be remotely configured, so that they more exactly match
customer requirements for e.g. Microsoft Windows 95 product has this capability.

20

Warranty
Manufacturers of most products offer warranty and, in some markets
such as automobiles, manufacturers may try to gain a competitive advantage by
offering longer warranty periods. Warranty reduces the financial risk of owning
products and therefore it is important element of customer support. Over the lifetime
of product, support costs may be greater than the initial purchase price. In the
computer sector these costs are referred to as cost- of ownership and the cost of
buying and operating computer hardware for the office is rather like an iceberg most
of them are hidden. Consequently, as products demand more economical and
effective support. To reduce the risk of expensive repairs, more manufacturers offer
customers the possibility to purchase extended warranty. However, in the domestic
appliance sector, manufacturers have been accused of charging excessively for this
cover.

Upgrades
Offering customers the chance to enhance the performance of existing
products can be an important aspect of customer. For e.g. computer manufacturers
offer upgrades because they increase the working lifetime of products and can be
significant source of revenue. Original equipment manufacturers have a competitive
advantage in this business because they normally have records of where equipment has
been sold which could benefit from upgrading.

21

CUSTOMER SATISFACTION AND LOYALTY IN AFTER SALES

SERVICE
In todays competitive marketplace, its easy for customers to change suppliers if they
find a cheaper, faster or better service elsewhere. Loyal customers are likely to
consider you first when they need something and tend to be more receptive to new and
service.
The study was to gain improved understanding of the forces and factors present in
after sales service activities, and the role of these in enhancing or endangering
business. The objective was to gain a better understanding of how a supplier could
successfully manage its customer care activities in the dynamic mobile
telecommunications market. After sales business activities in this industry have
received little systematic research attention. The study described herein focuses on
after sales aspects of business- to business activities in the mobile Telecommunications industry, with the emphasis on sectors that provide service. The
method study primarily relied on the case study approach. Some aspects of qualitative
and action research methods were integrated in the formal study process. The study
consisted of study and analysis of five in depth cases. Qualitative and quantities
information and data were collected from each of the persons interviewed in the
supplier and customer organizations.
The term, care is used extensively in the study as a
doorway into the world of after sales service activities as well as an organizing
construct for interpreting what was found. The concept of care includes activities
related to maintenance and preventive maintenance. It additionally includes services
that can link back to help enhance pre-existing capabilities for delivery of products or
systems. Processes and measures of customer satisfaction and loyalty provide two
critical aspects of the study.
The importance of the concept of care and the actions
that define it were found to be critically important for a customers total satisfaction.
The importance of the care phase in the total customer process was found to increase
as the customer relationship matures. Different services offer different characteristics
and challenges, while for many customers their satisfaction-loyalty relationship with a
provider tends to be non-linear. The relation between customer needs, satisfaction, and

22

loyalty, and how these ultimately relate to a providing firms profitability, were seen to
be linked in complex ways. The complexity can be studied in many ways but herein
the customer satisfaction-loyalty of each service event was first evaluated separately.
Customer satisfaction and loyalty were then related to each other in order to compare
the separate and combined characteristics. This provided the reference basis for
analyzing and forecasting how a customers behavior might change relative to their
level of satisfaction. While the determinants from these evaluations present evident
limitations, they were additionally found to provide a basis for better mapping the
more systematic interactions between the many possible kinds of behaviors and levels
of satisfaction.
The study presents information as to how communication between the supplier and
customers was organized. Based on this, it was hypothesized that, as the relationship
between the supplier and customer matures, the interactions become more specialized
around specific around specific activities. Managers, on the other hand, were seen to
give ever-greater emphasis, in terms of their arena of activities. For Example, the
service manager and project manager emphasized certain specific parts of a total
project while an account manager would tend to emphasize those aspects most closely
related to contact-based relationships. This was seen to allow emphasis on service to
be given in terms of modern functional management systems instead of the dynamic
reality of the situation. This was seen to present significant challenges to an integration
of different perceptions of different yet related functions. This was identified as an
area of focus for providing more complete and consistent customer care. This led to
the creation of a new conception of the nature of the nature of the service manager,
which could be extended to the entire supplier company. This work, carried out to
implement this idea, illustrates that there is a great, unrealized potential, particularly in
the creation of a viable model of after sales customer care able to accommodate the
contemporary business development.
Global competition is accelerating. Product margins are decreasing. Customers'
expectations are higher than ever.
Companies looking to grow and increase profits can no longer overlook the untapped
opportunities from their service business. A recent Deloitte Research benchmarking
study of manufacturing companies indicates that the average profitability of service
businesses is more than 75% higher than overall business unit profitability and
23

accounts for 46% of total profits. The study further noted that most service businesses
fail to grow due to the complexity of their operations.
Indeed, traditional after-sales service businesses often rely on disparate systems and
decentralized data. They traditionally fail to obtain accurate information from key
sources within their business network. This impacts their ability to deliver an
optimized level of after-sales service.
By aligning operational processes and systems for comprehensive visibility across the
entire service network, forward-thinking companies are overcoming these challenges
and transforming their after-sales service businesses into profit centers. This end-toend approach enables highly efficient operations to develop, market, sell, and deliver
more profitable service offerings while increasing customer loyalty.
How do best-run businesses champion after-sales service to drive higher profits?
A leading manufacturer of scientific laboratory equipment needed to accelerate its
global service business. This world-class company was able to automate its service
business by using SAP Software to streamline key operations. This approach generated
35% in ROI, thereby transforming what was historically seen as a cost center into a
sustainable revenue-generating competitive advantage.
Solutions Designed for Delivering Efficient After-Sales Service
Solutions from SAP help align after-sales service operations to generate profitable
growth. With highly efficient operations, you can maximize profitability and revenue,
improve customer service, and reduce costs.
Drive Effective Service, Sales, and Marketing
By closing the service, sales, and marketing loop, you can rapidly analyze after-sales
service profit and revenue potential, and directly drive marketing campaigns, turning
leads and opportunities into new service orders and contracts.
Provide Superior Customer Experience

24

With consistent service experience across multiple channels, one can improve
customer satisfaction and loyalty, while reducing transactions costs.
Deliver Efficient Field Service
By optimizing performance across the service delivery life-cycle, field service can be
managed with increased efficiency through automated identification and scheduling of
resources in accordance with predefined service level agreements.

Keywords:

Customer satisfaction, Customer loyalty, after sales marketing,

telecommunications, services, customer relationship, business-to-business.

25

CUSTOMER SERVICE BEYOND AFTER-SALES AND REWARD

SNCE the early 1990s the services sector in India has been paying a lot of attention,
or so it would seem, to delivering customer service and satisfaction. Service brands
across categories from banks and credit card companies to airlines and retailers have
been jumping on the our customer is important to us bandwagon. This is most evident
in service brands attempting to impress their target group through brand positioning
that uses customer service as a differentiator. ICICI Bank says We make banking a
pleasure. Sahara Airlines signs off all ads with the tag line Emotionally yours and
BSNL releases an ad on Consumer Rights Day that states, We have decided not to
make any tall claims on Consumer Rights Day. Because at BSNL, every day is a
Consumer Rights Day.
The other evidence that service brands in India have begun to pay
attention to customer satisfaction and loyalty is the growing number of rewards
programmes being offered by airlines, hotels, retailers, credit cards et al. Yet, one
wonders if service brands in India have really come to grips with the fact that true
customer service goes beyond polite personnel, friendly ads and reward programmes.
Judging by the way service brands in India are marketed, it does appear as if most
service organizations and brands have yet to implement the core fundamental of
delivering customer service. Which is that quality service has to be made part and
parcel of the entire business organization starting with corporate policy and
percolating to every other aspect be it product service design, marketing programmes
or service delivery by frontline personnel.
Once a customer is acquired, most marketers of service brands seem
to presume that the intrinsic quality of the product and service will take care of
customer satisfaction and if at all the customer has a problem, the customer relation
department carries the responsibility of ensuring that the customers remains satisfied.
While the aforesaid facts may be true, the marketing function in a service organization
can add tremendously to customer satisfaction through developing marketing and
communication strategies with the sole aim of ensuring customer satisfaction and
retention. And in doing so add significantly to meeting customer acquisition objectives

26

through positive word of mouth from satisfied customers. This is rudimentary to

service businesses- yet most service brands to service businesses- yet most service
brands in India( with a few notable exceptions) seem to focus purely on customer
acquisition with very little evidence of customer retention marketing and practices.
Take, for instance, regular monitoring and benchmarking of customer
satisfaction levels. How many service businesses (other than some airlines and leading
hotel chains) are doing that?
One would imagine that such monitoring exercises are invaluable to
marketers of service brands not just in terms of ensuring that product and service
design are in line with customer expectations but also because the effort contributes to
building of an image of heres a brand and service company that cares. Many
customers may never respond to questionnaires on satisfaction ratings but will
definitely retain a positive image of the company being a service oriented one.
It has been my observation (purely in my individual capacity as a consumer)
that most service brands ranging from banks and credit card companies to insurance
and cellular service providers send out lot of mails in the form of billing statements,
reward point statement and so on, but other than that, not one of my service providers
has ever made contact on the subject of satisfaction levels. Even on the rare occasions
that I have phoned or visited the office of a service provider I have never been
questioned on my levels of satisfaction. If such service providers are indeed investing
in market research one wonders as to why they have failed to recognize the importance
of actively researching the needs and wishes of their existing customers in a manner
that is visible enough to add to customer retention and satisfaction rates and equally
important to brand image.
The second area where marketers of service brands have a key role to play is in
taking care to segregate marketing to existing and potential customers. Indeed
marketing programmers designed exclusively for existing customers can add
tremendously to customer retention and satisfaction levels. And the failures to do so
can result well in customer dissatisfaction and attrition. This point is best illustrated
through a recent experience I had with the credit card division of standard chartered
Bank (my credit card company since 1995). I hold two gold cards both master card
27

and visa. Last year I received a complimentary executive card from the bank out of the
blue a card that I had not asked for or needed! Of course, the card was handdelivered by courier, beautifully packaged and presented with a very nicely worded
covering letter, but instead of pleasing me the whole effort only succeeded in highly
annoying me. For one, the incidence clearly told me that the bank had not
distinguished between existing customers and potential customers. Second, I was even
more annoyed because I would now have to take the effort of canceling the credit
cards. Quite obviously, such marketing efforts are the result of what I would term as
blind marketing in as much that communication ands sales efforts are sent out to
subscriber lists without first checking such lists to weed out existing customers. I
shudder to think about the sheer waste of marketing expenditure and effort. Though, of
course, the real price being paid is in terms of alienated rather than flattered customers.
Just imagine the reaction of gold card member receiving a less premium card with
much lower credit limit, even it is complimentary!
If, on the other hand, my credit card company had acknowledged
that I was an existing customer of theirs but were contacting me to check if I would
prefer to switch to a card more suited to my needs such as, for example, a card that
only clocked frequent flyer miles on expenditure, I would be left only not only with a
positive image but an affirmation that I placed my business with the right people. For,
here would have been a service provider who was taking the effort to find out if I
knew about recently introduced options and would prefer to switch or upgrade as the
case might be. While such a strategy involve a cost in keeping up a dialogue with
existing customers, it has been well established by successful service organization
such as southwest airlines in us that meeting customer needs on an individual level
outweighs the cost. For the simple reason that in the final analysis it is far more costly
to continuously acquire new customers to maintain market share. A fact that is already
recognized and acknowledged judging by the fact that most large service businesses
have a unit that focuses only on customer churn and recovery.
What one is suggesting here is that conscious marketing to existing customer
or customer retention marketing using one- on one marketing techniques can
actually contribute to reducing customer churn and whats more, also result in tangible
business gains such as higher share of the customers wallet.
28

One service company that seems to be quite visibly practicing customer

retention marketing is orange. For one, Vodafone customers receive regular booklets
offering discounts on a host of products and services in an effort to enhance brand
value and customer satisfaction. Second and more importantly, Vodafone obviously
instituted systems and processes to track customer usage and preferences that allow
the company to individualize and personalize customer retention and satisfaction
efforts. Recently, the brand invited several of its customers who the company knows as
the cricket buffs to meet Sachin Tendulkar
At the launch of Vodafones co- branded credit card with visa and standard chartered
bank. This was done through tracking the use of cricket SMS messages. The brand
also makes regular efforts to gain more business from its exciting subscribers by
telemarketing its other facility such as roaming facility. What is particularly net worthy
is that the telemarketing executives seem to be well trained to interact with customers
with the end result of building highly positive brand associations if not more revenue.
The call routine and procedure have obviously been determined based on Vodafones
knowledge of its customers. In this particular case, Vodafone have taken into account
that its customers do not like receiving sales calls on their cell- phones. Therefore, the
roaming tele-marketing call begins with a pleasant voice identifying the source of call
as being from Vodafone, then wishing the customer followed with an assurance that
the call is not chargeable before getting to the purpose of the call as in seeking
subscription to the roaming facility.
A third ands an important aspect and marketing of a service brand is the
need to manage customer expectations. While this may be true for all brands, the
significance of doing so is much more critical in the marketing of service brands since
customers buy into the promise of a service experience making the field into the
product. Manage customer expectations well and delivering a pleasant service
experience becomes that much easier. Recently, customer of jet airways received a
communication from the airline that requested their co-operation in observing the
revised check- in timings and helping the airline in working towards on-time flight
departures. The communication explained that the need for heightened security checks
was leading to delays and in an effort to prevent this; the airline has revised his check
in- timings. This is very good example of managing customer expectations. In sending
29

out this communication, the airline has placed in perspective the main reason behind
the flight delays ( most airline passengers simply assume that the airline is fault) and
solicited its passengers co-operation in ensuring that flights leave on time. The other
benefit in such an exercise is that the airline frontline personnel would now be more
effectively supported when faced with passengers irate at flight delays as well as late
coming checks- ins. Compare this with ISP cable in Mumbai whose marketing
promises 24 x 7 customer support whereas in reality, the company is only contactable
between 1030 and 1830 hours Monday- Saturday! I dont think one need to spell out
the consequences of such marketing and I am pretty sure that it will soon discover the
price, as in customer attrition to an ISP more focused on customer service.
A fourth and critical aspect of customer retention marketing is discipline
whereby customer acquisition strategies are evaluated for any possible adverse impact
on customer satisfaction levels. The importance of this best illustrated through a live
example of HSBC a rather late entrant into the already crowded credit card business.
A year or so ago, HSBC embarked on a drive to increase its credit card customer base
through linking the use of its ATM machines with its credit cards. Now the fact is that
I had been operating my savings account through HSBC for almost a decade largely
on account of the fact that the bank had the best ATM network for a very long time ( of
course, today there are many other banks which provide equally wide offers., if not
better one distribution of ATM machines). All those years of HSBC banking and I
wonder why the bank had never made an attempt to procure more business from me
for their other products and services. So when I received a courier with a
complimentary credit card ( yes, I had the dubious honour of receiving five credit
cards in 2001 from different banks all unsolicited and all of which I had to spent
time and energy in canceling! ), I said to myself, well, they seem finally woken up,
till I read the accompanying letter and saw red! For, the letter informed me that the
credit card would now replace my existing ATM card, which would be deactivated 21
days from receiving the intimation. In other words my bank was forcing me to
subscribe (membership fees of Rs. 2,100 per annum) to their credit card product if I
wanted to continue accessing the ATM facility. The net result? I wrote a very strongly
worded letter to the bank terming their move as tantamount to coercion (even if the
card was free for one year) and threatening to move my account. What followed was
worse. Not only did I not receive any reply from the bank, some months later when I
30

finally got round to canceling the credit card they offered me a debit card with nominal
annual charges. Leaving me to wonder if there where other customers who were
unknowingly living with a credit card that they hadnt asked for but were now going to
pay Rs. 2,100 as membership fees. The clincher came when I spoke to HSBC about
shutting down my account and was offered reinstatement of my ATM card on the bank
discovering the reason for closing the account. A classic case of Too little, too late
since I have increasingly moved all my business to another bank. Speaking of which
would bode well for all marketing people in the service business to remember that
majority of customers never complain. They simply take their business elsewhere!

31

AFTER SALES SERVICES

STRATEGY
After selecting the after sales service method it is important that the
company choose the right strategy for after sales service too. Both of these elements
are essential for any company to have the most effective and efficient after sales
service center. For implementing a top quality after sales service plan it is necessary to
select the proper strategy too. The decision of how to distribute products and to after
sales service such as warranty, service contract, repairs, etc. is linked to the overall
strategy of the organization regarding its product and the markets it plan to serve.
After study in various texts on marketing/ logistics /
distribution channels, the element, that manager examine as they formulate their
physical distribution and after sales service support strategies can be grouped into
various dimensional attributes. These include:

Product-related attributes such as its life cycle, complexity, value, physical

dimensions and consumer perceptions.

Firm-related attributes such as managerial objectives, resources, desire for

control, and breadth of product- line; and

Market- or industry- related attributes such as consumer preferences, and

consumer

value,

organizational

consumer,

geography,

market

size,

competition, and nature and availability of channel intermediaries.

There is another classification for service strategies, which is introduced by Milind
(1997). He classified service strategy in 3 basic groups:

Product or design related: these focus on increasing product reliability,

building redundancy, and adopting a modular product design.

Service support system: these concentrate on changing the way of

manufacturers provide service. These approaches can address either
improvements in system design or reductions in equipment repair.

Reduce customer risk: it reduces chiefly through warranties and service

contracts.

32

THE AFTER-SALE SERVICE PROCESS: STRATEGIES

The after sales service processes was given By
Richard G. McNeill (1999)

During the Implementation Step

.

The After-Sale Service Process, customers have three distinctive stages of

perspective during Implementation of the Product/Service step of the after-sale

service process:
(a) The Novelty Stage,
(b) The Learning Stage, and
(c) The Effectiveness Stage.
Sellers must be aware of and have strategies to manage each of
these stages. The most important stage to manage is the Learning Stage where the
customer undergoes a concept called the Motivation Dip.
The Motivation Dip refers to a sharp decrease in the customers enthusiasm or
motivation during the Learning Stage. Just after the purchasing decision and during
the Novelty Stage, its common for the customer to have high expectations and
motivation toward the product/service. As the customer enters the Learning Stage,
generally enthusiasm will rapidly drop off. This is phenomena is a fundamental part
of psychology; enthusiasm is replaced by the realities of working harder (to learn
about the product/service) and/or having more focus and concern about the success of
the products projected successful implementation and results. Once results begin to be
realized (the Effectiveness Stage), the customers enthusiasm and motivation will
usually climb again to the levels of the Novelty Stage.
An illustrative metaphor is the enthusiasm of a New Years resolution to get into
shape through an extensive exercise program. Enthusiasm is often replaced by a
motivation dip as the real work of the exercise program becomes a reality. After

33

results start coming in the Effectiveness Stage, (getting in shape), motivation climbs
again. Effectiveness of the exercise efforts becomes the motivation driver.
Three Strategies for Handling the Motivation Dip

Strategy One:
Start Before the Contract Is Signed. In the installation phase, an
anxious customer will look critically for any sign that things are going wrong and may
overreact to minor difficulties. The salesperson can look to the Buying Process to
guide this strategy.
The salesperson can begin during the Evaluation of Options step in the buying
process. The salesperson can make sure that the customer genuinely feels that the
product service matches customer needs. In other words, ask enough questions and
clearly and honestly demonstrate the product/service as compared to the competitive
offerings.
During the Resolution of Concerns (negotiating buyer objections) step in the buying
process, the salesperson can make sure that the customer fully recognizes and sees
ALL potential consequences or concerns. These must be FULLY resolved or they will
become a potential future concern that will exacerbate and accelerate the motivation
dip. For example, if the customer feels nervous about the salespersons companys
reputation, it is important to resolve the issue BEFORE signing of the contract, so it
wont resurface in the form of negative reactions during the implementation of
product/service phase (Rack ham, 1989).

Strategy Two:
Involve the Customer. Regardless of how carefully the
installation and implementation of a new product/service, something will go wrong.
While a detailed step-by-step installation plan is essential, it will not guarantee success
or protect against unexpected problems. Build a detailed implementation plan and the
customer will gain a comfort level. Making sure that the customer is involved in the

34

construction of this plan will ensure their loyalty and satisfaction should any
unexpected problems occur. After all, its hard to point the finger at yourself.
Salespeople successfully implement when they get the customer to play a central role
in the development of the implementation plan. Here the salesperson does not take the
lead in designing the plan and plays the role of a facilitator who helps the customer
improve upon their own implementation plan ideas.

Strategy Three:
Put in Effort Early. Understanding that the customer generally
goes through three stages during the implementation phase can help avoid the
motivation dip. Salespeople who dont understand make the mistake of interpreting
the customers enthusiasm during the Novelty Stage as a signal that all is well and
that this high will continue in a positive way. Consequently, they give the customer
less attention and fail to detect the motivation dip occurring in the Learning Stage.
Its easier to anticipate and prevent problems before they occur than to deal with
something that is quickly deteriorating at a rapid pace (accelerating motivation dip).
Its easier and takes less time to prevent a fire, than to fight one. Early effort will not
prevent the motivation dip, however; it will minimize the steepness and severity of
the decline.

Maintenance and Development of the Customer Step

This step begins after the customer has been guided through the
Implementation of the Product/Service Step. At this point, the salesperson has:
(a) Successfully obtained a signed contract and
(b) Successfully implemented the product/service.
The goal at this step is to continue the relationship with the
customer and obtain repeat business (maintain) and penetrate the customer account
(develop). In other words, there is a recycle back to the first step of the buying
process; and, a new sales cycle begins. As previously discussed, the first step of

35

the buying process is the Recognition of Needs phase. Obviously, with successful
implementation in place and a strengthened relationship with the customer, the
salesperson should have more familiarity with the customer this second time around
with a more open dialogue with the customer during the crucial discovery of needs
phase. Maintenance and development of the customer begins at the first phase of
the buying process.
Often after a first purchase, the customer doesnt seem to have immediate additional
buying potential. Unsuccessful salespeople simply play a waiting game maintaining
good relationships while passively waiting until circumstances change. Successful
salespeople, on the other hand, take an active and dynamic approach by using their
initial successful sale to penetrate or develop the customer account. They look for
more areas within the account where their product/service may offer a solution.
Generally, they use six strategies (Rack ham, 1989).

Strategy One:
Maintain But Actively Develop. Salespeople can make new
Persuasive Sales Calls. Maintenance alone often results in visits, lunches and social
chats. These actions are aimed at protecting existing business from competitors and to
ensure that the customer keeps the seller in-mind should buying needs arise. Using
only this strategy is generally ineffective.
Successful salespeople not only maintain their existing customer
accounts, they actively look for new opportunities to penetrate within these accounts.
Their objective is not to protect but to project or to sell. By having an objective
of developing during the course of maintaining their existing customers,
successful salespeople not only will protect the account but also will obtain more sales
from the account.

Strategy Two:
Document the Good News. Salespeople can make Reminder Sales
Calls. Most of the time, the salesperson is in contact with the customer when things
are going wrong. A better strategy is to remind the customer of the benefits that have

36

come from the sale. Stay in contact with the customer when things are going right.
Remember that customers keep a file on correspondence with the selling company.
Imagine what a file would look like to a new decision maker at the customer company
reading a file full of bad news. Shouldnt the good news be recorded?
Good news such as other satisfied customers can be forwarded FYI (for-yourinterest) to your existing customer. Additionally, the salesperson can write to the
customer outlining the positive and successful impact your product has had and
offering any further help and assistance. When its time for repurchase, the selling
company is in a stronger position.

Strategy Three:
Educate the Customer on New Developments. Salespeople can
make Informative Sales Calls. Related to developing the customer account, the
salesperson informs the customer of new product/services and changes within the
industry or selling company. The long-term relationship between the customer and
seller is further strengthened in this open sharing of information that affects both
customer and seller.

Strategy Four:
Generate Referrals. Salespeople can make Lead-Generation Sales
Calls.

Ironically, the more that the salesperson has satisfied the customers needs,

the less there is a need for an immediate repeat business from the existing customer.
As mentioned above, the customer account can be further penetrated and also can be a
source of referrals both internal and external to the existing customer. Satisfied
customers are often delighted to help the salesperson. They can give contacts and
introductions.
Remember that the motivation dip occurs during the second stage (Learning
Stage) of the implementation step, so referrals must be obtained early in the Novelty
Stage or late in the Effectiveness Stage.

37

Strategy Five:
Rethink the Understanding of Customer Needs. Salespeople can
make Needs Assessment Sales Calls. Customer needs change. The salesperson
should make periodic calls on the customer to reassess their understanding of the
customers needs. Remember that competitors are attempting to or are regularly
assessing your customers needs. They can take your existing account away by
uncovering and developing needs that the salesperson has neglected. After all, didnt
the salesperson also obtain or take away this existing customer from someone else?

Strategy Six:
Influence Future Decision Criteria. Salespeople can make
Decision Criteria Sales Calls. Salespeople can help educate or refine the process by
which the customer makes decisions. Perhaps the customers level of sophistication is
relatively low.

Here the salesperson can facilitate the customers learning of

methodologies that help decide on optimal product/service solutions. If the customer

is sophisticated, the salesperson can openly discuss decision criteria. This may be
information gleaned that is useful to the salesperson and/or serve as a soundingboard and idea refinement for the customer. In all cases, the customer will see the
salesperson as a consultant and partner in the relationship. This bond should lead to a
stronger long-term relationship and increased repeat business, referrals, and customer
account development.
After-Sale Service is never static
As discussed, after-sale service strategies formally begin when the contract is signed.
However, in anticipation of after-sale service, the salesperson sometimes initiates
preventative strategies even before the contract is signed. After-sale service is
intended to build long-term relationships with customers to ensure repeat business and
referrals, but these relationships cannot automatically be assumed due to the initial
sale; they are never static. They are either improving or decaying. What matters to
customers is not what the salesperson did for them yesterday, although yesterdays
success is a must. What matters is what the salesperson is doing for the customer
today and tomorrow.

The salesperson must never become complacent since

38

complacency is an invitation to competitors.

Good customer maintenance and

development is about continuously improving service to the customer.

Summary
The goal of Consultative Salespeople is the acquisition and maintenance &
development of customers. Discussed above was the Pre-Sale Phase: Acquisition of
Customers. This was followed by the Post-Sale Phase: After-Sale Service Process
is composed of two steps:
(a) Implementation of the Product/Service and
(b) Maintenance and Development of Customers.

39

FACTORS INFLUENCING CUSTOMER SUPPORT STRATEGY

(AFTER SALES STRATEGY)

Goffin (1999) also had a research that determines which factors influence companys
customer support strategy (after sales strategy). From his analysis, it appears that there
are at least four important components to customer support strategies.
Identifying customers support requirements:
Understanding the customers needs for support
in an intuitively obvious aspect of deriving a support strategy. However, it could
well be that many companies neglect this. Most of the case study companies said
they actively conduct market research into opportunities. One respondent
summarized this is: the whole accent on support as far as we are concerned is
getting to know your customer and helping them get the best out of the product. To
ensure this we (the manufacturers) can offer to examine the customers operation
and provide advice on how he can get the best from the product. This can be
technical, operational or commercial advice.
Design for supportability:
Since product design strongly influences how easy it
is to support products, it is essential to consider customer support at the design
stage. Some of the sample companies concentrate significant resources on this and
have been successful at improving the supportability of their products.
Choosing or managing distribution channels:
The distribution channels used for support can
have a strong influence on the quality of support received (and perceived) by the
customer. Therefore, the choice of the channel is an important one and sometimes
the high costs of the direct channel are more than offset by the revenues it
generates and the competitive advantages it creates. Once a channel or channels
have been chosen, companies face the challenge of ensuring that all customers

40

receive good support. This requires good logistics: for e.g. in the management of
spare parts ensuring that customers support engineers are quickly available to
conduct maintenance and repair. Companies also need to invest in systems for
monitoring the performance of their customer support organizations.
Promoting support for competitive advantage:
Inspection of company and product brochures from the
sample companies showed that they all promote the quality of their support to their
customers to some degree. However, customer support needs to be skillfully
marketed and one respondent company stated they needed to improve in this area.
So all firms who are offering service must consider one or
some of above factors and select the best and appropriate service strategy for their
firms. Choosing the right strategy may give a good opportunity to company to
supply best service and get maximum satisfaction from customer and finally be
successful in the market.

41

RESEARCH METHODOLOGIES
PURPOSE OF THE RESEARCH:
Research can be divided into different categories of studies. The
different types of studies may be categorized into following three groups:
Exploratory research:
This type of study aims to explore what really is
happening and seek new insights. Further the explanatory research is especially
useful if you expect to clarify the understanding of problem. The purpose of an
explanatory research is to gather as much information as possible about
specific problem. This type of studies is often used when a problem is not
known or already available is not complete.
Descriptive research:
This type of study aims to provide an accurate picture
of market environment. It can concern past or existing relationship and is
recommended when searching data. Often secondary, in order to describe
aspects of a clearly structured problems. Descriptive research is used to
determine answers to: who, what. When and how questions. Normally, the
descriptive research is used when a problem is well structured and there is no
intention to examine the casual relationships. In this method, researchers want
to know which aspects of problem are relevant and want to describe these
aspects more thoroughly.
Explanatory research:
Research with an explanatory approach establishes
casual relationships between variables. It also mentions that for explanatory research
we should focus on cause- effect, relationships, explaining ad show which cause
produces which effect. In this method, researchers make assumption on what kind of
correlation exists between variables. The thesis is partially exploratory since the
42

companies are trying to explore the purpose to gain a deeper understanding of why the
computer hardware should provide after sales service. The study is also descriptive as
well describe what proper types of strategy and methods of after sales service must the
companies choose to have the best performance.
Research approach:
The definition of qualitative versus quantitative research explains the
researchers approach to the study. When conducting research there are 2 different
methods that can be used; Qualitative and Quantitative. These methods refer to the
way researchers treat and analyses the collected data. By using these approaches the
researchers will know how to treat and analyze the gathered information.

Qualitative research:
This research approach is less formal and based on

unsystematic and unstructured observations. This can be example indepth interviews or an interview guide with open answers. Qualitative
verbal analysis is often used in order to gain better understanding. The
purpose of this approach is to understand and analyze the situation as a
whole. The qualitative research must be kept flexible and the
possibilities to change the planning open during the whole research
process.

Quantitative research:
The quantitative research is based on numerical data,

which then are analyzed and presented in figures with statistics. For the
reason that the quantitative research often is more structured than
qualitative one, the planning of quantitative research is more
standardized. A positive aspect of quantitative approach is that it is rather
easy to generalize from the gathered information. It must be kept in mind
that the gathered information should always be relevant for the problem
definition.
The quantitative approach has been used in this
thesis, since deeper and broader understanding is aimed to be reached

43

within the research area. From our point of view, it is necessary to let the
interview respondent freely describe the entire research area from his
point of view. The reader should however keep in mind that the
empirical data in this thesis is highly based on the companys and the
respondents attitudes and perceptions, and therefore the empirical data
will be easier to demonstrate in words instead of statistics.
Research strategy:
There are 5 strategies to choose among when conducting social
sciences. These are experiments, surveys, analysis of archival information,
histories and case studies. Each strategy has advantages and disadvantages and
can be used for the same research purposes. The differences between the strategies
is the different ways of collecting and analyzing the empirical evidence.

The type of research question

The level of control an investigator has over actual behavioral events.

The focus on contemporary as opposed to historical phenomena

Relevant situation for the research strategies are illustrated in the below figure.
Strategy

Form of research
questions

Requires
over

control Focuses

on

behavioral contemporary events

events
Experiment

How, why

Archival Analysis

Who, What , Where,

How

many,

Yes
How

No

Yes
Yes / No

much
History

How ,Why

No

No

Case study

How ,Why

No

Yes

Fig: relevant situation to different research strategies

44

An experiment is a term, which implies that only few variables are

studied. Other things that might affect variables must also determine. Surveys are
conducted with help of questionnaire or an interview and the goal of the survey is to
reach a large demarcated group. Survey researches give the possibility to gather
information about a greater number of variables, as well as lot of information about
limited number of variables. Archival analysis is based on secondary data that was
developed for another purpose than helping the problem at hand. However, it does not
necessarily mean that focus is given to past events. A historical strategy is not focused
on contemporary events. Case studies aim to gain an extensive knowledge about a
small case or a small number of cases. The main advantage with this approach is that
researchers can gain a rich understanding of the on text of the research. The case study
can be single or multiple. The single case study investigates on an entity, a company, a
decision or a region, in depth. In multiple case study, two or more entities are studied
which gives the opportunity for comparisons. On the other hand, each entity will be
less in depth investigated.
In our study, the research questions are based on how questions,
which we will have no control over the actual behavioral events and our focus on the
study will be on a modern event. We can either conduct a survey or case study. As
stated earlier in our thesis we will have a qualitative approach so a survey is not
suitable, as surveys are quantitative in nature. For this, reason our selection of research
study is to work with the case studies. Besides, the qualitative approach calls for a
more fully understanding of our purpose, which can be best achieved by implementing
this strategy. The characteristic for a case study is that it comprises a large amount of
details, which a survey is usually not capable of.

45

DATA COLLECTION METHOD

To be able to understand the research area more in detail, the
empirical data must be collected. There are 2 different types of empirical data that can
be collected: Primary and Secondary. The primary data is collected for specific
problems, while the secondary data is collected for a more general purpose.
When collecting empirical data, the researchers has to choose
between using questions methods: like questioners, personal interview, using
observations or documents. The questions are often less structured in a questionnaire
and the respondent answers to them without explanations and without any influence
from the researchers part. However by using telephone or personal interviews the
researchers can pose more complex questions and explain possible misunderstandings.
The duration of an interview is often limited when doing telephone interviews:
therefore personal interviews are from this point of view more referable. Concerning
observations the researchers can only observe ongoing processes, situations and
behaviors. The positive aspect of observations is that they do not depend on the
respondents willingness to reveal more personal information. Documentations are
primarily used to collect secondary data. For e.g. statistics, registrations, official
publications, letters, diaries, newspapers, journal, branch literature and brochures can
be used for collecting secondary empirical data.
The documentary information is likely to be relevant in every case study. Documents
can take any forms, such as administrative documents involving for e.g. progress
reports and other internal documents.
Validity and reliability
According to Erikson and Weidersheim Paul (2001), reliability and
validity of the information received within a research a highly important aspect of
scientific study. Reliability shows the trustworthiness of the measuring instruments
this means that another researcher with the same approach should be able to come up
with the same results. Validity is a ability of the chosen instrument to measure what it

46

is supposed to measure. According to Yin (2003), the reliability is often difficult to

ensure when conducting qualitative research. The subjects and variables in a
qualitative research are often abstract.

47

RESEARCH METHODOLOGY

10 WAYS TO WIN GLOBAL CUSTOMERS AND INFLUENCE

THEM TO BUY AGAIN
Implement an extraordinary after sales service plan. The relationship
between your company and your overseas customers shouldnt end when a sale is made.
If anything, it should be just start of a long relationship that requires more of your
attention. The care and feeding of your customers will determine if they keep coming
back for more.
A customer in United Kingdom whom a person been dealing with for
about five years recently emailed them an order for a product which he knows nothing
about. Completely bewildered, the person emailed back, saying that there must be some
mistakes. He replied, There is no mistake. I want you to take care of this because I
dont know the supplier and I trust you to conduct this business properly. Take a
reasonable percentage. After your last shipment, you shocked me when you emailed a
week later to ask if there was anything you could assist my marketing efforts on the
product received. I will never forget this. Most American companies dont communicate
with us after the sale unless we place another order, but you were different. I would
have thought that standing behind my product and taking professional responsibility for

48

my customers satisfaction and success was the obvious thing to do, but apparently I was
wrong!
Think of your after sales follow up as part of your product. If this
attitude is as rare as my English customer says it is, you will be setting an unprecedented
standard of professionalism. Your customers will be deeply impressed, and they will
never again want to settle for less.
Here are 10 tried and true global strategies for after- sales service
success
1. Make customers your business:
Lets go back to basics for a minute. What drives your
business efforts? What are you really in it for? To make a ton of money? To achieve
total quality control? To order around a bunch of employees and be the big fish in
your pound? Whatever your motives, if you want to stay in the game, you had better
be in it for the right reasons: to get and keep customers worldwide.
Without customers, there is no business. Never forget whos driving the deal. You
can explain to the customer all you like about your company policy and why things
are the way they are when it comes to pricing, packaging, product design or anything
else. But if the customer doesnt like what he hears, theres no deal. If the price is
too high, theres no deal. If product quality is insufficient, theres no deal. If you
cant show them a market, theres no deal. If they dont see value, theres no deal.
The customer not you, not your company policy, not the economy, not Congress
dictates what you will provide. So pay attention to your customers. They know what
they need and what they want. Do your best to make it happen for them.
You won your customer over with the first sale. If you dont follow
up with ongoing service, you may lose her future business. Whether you lose a
customer a block away or 12,000 miles away, she is still a lost customer- something
you cannot afford. Dont think of customer service as a sprint, in which you go all
out and then drop in exhaustion. Its a marathon without a finish line. So if you want
to keep her on your team, begin your relationship all over again after the sale!
2. Keep in touch with your customer.
The first step in after sales service is to say, wholeheartedly and
in- person if possible, Thank you for your business! then follow up by expressing
49

further sincere appreciation in writing. These are musts. Dont fail to do them just
because they seem as obvious as to be insignificant. Your customers will notice.
They will they also notice if you dont do these things. What you might classify as
NBD (no big deal) might be just the NBD your customer needed to convince
him to do business with you again.
After that, plan for regular communication. If you have
the time and energy, contact them everyday. If thats too burdensome, communicate
regularly on a schedule thats workable for you and sufficient to inspire your
customers confidence.
When all else fails, communication might be all you have offer your customer. But
that offering is a service. And for your customer, that service is as good as a product.
3. Satisfy your customer.
You can deliver the right product, the right service, the
right price but do you deliver satisfaction? The only way to find out is to follow up
and ask, Are you satisfied with my product or service? if the answer is no, youd
better have a plan. Remember: a complaining customer is a customer about to leave.
And when they do, theyre sure to tell 10 other people about it! Hang in there, and
talk it through until youve restored, and even strengthened, the bond with your
customer.
What about the customer who hasnt reordered after
several months? This doesnt mean there are no more orders top are had. It means
that you must take the initiative to find out why they havent reordered! If your
customer doesnt tell directly that there is a specific problem marketing your product
in his homeland, learn to read between the lines and pinpoint it. Then rethink your
product, or offer sales support, as needed.
4. Deliver on your promises.
If you promised the moon, deliver it along the handful
stars. You want to shine in your customers eye.
Delivering on your promises is doing what you say you will do, when you say you
will do it. Every time you follow through on a commitment, small or large, you build
trust. If you say you will fax prices to your customer by tomorrow, try for today. If
you say you will air ship sample products within a week, ship within a week (or
50

sooner). If you say you will reduce prices because of local competition, reduce
prices. Dont just talk about it, do it. Keep supplying and standing behind what you
promise again and again, over and over.
5. Go beyond expectations.
Delight your customer beyond all measure. Youve sold
them your product or service; now astonish them with your out of the box thinking
by going way beyond the call of duty. If your customer wants ordinary service, let
them do business with your chief rival. Dont waste time worrying about whether
they will appreciate it or not. Let them shop elsewhere and see how bad it really can
get. Theyll back, a little humbler and wiser, and eager to do business. When you
give your customer more than they ask for, thats value- and value is hard to walk
away from.
For example, if your customer asks for product samples,
send them product samples. But send them super fast (efficient!), individually
wrapped in color tissue paper (memorable!), accompanied by a handwritten note
expressing your hope that they find them appealing (personalized!), and a coupon
worth 10% off on their first order (extra value!). Customers are impressed by
vendors that go beyond the obvious and safe ways of conducting business.
6. Involve your customer.
Dont just get your customer to purchase your product, give
them a reason to care. In other words, get them involved. If you are considering a
new product for market, ask your customer for comments about the packaging,
pricing, flavors, technology, and distribution so you can determine whether or not
the product will be a good fit for their sales and distribution channels.
Its all important to keep your customer posted if youre having trouble
meeting a commitment. No need to burden them with your life story, though. When
a problem arises that they to know about, keep the explanation concise and
purposeful. You want your customer to know if factors beyond your control are
standing in the way of your usual top notch performance. But provide just enough
information to develop an understanding and, where applicable, give them
alternatives. Thats all they need or want.

51

Involving the customer means letting them have a say in the course of
events. A customer who perceives his or her input as having contributed materially
to a desirable outcome feels very secure and positive about the relationship. Dont
wait for them to speak up. Solicit their input regularly.
7. Become your customers partner.
One of the best ways to strengthen ties with your customer
is to develop a product, market, or distribution channel together. Pooling resources
like contacts, skilled staff, production facilities, or joint financing for a project can
kick a business relationship into high gear. When you work together to make your
efforts succeed, you both win. How might you create opportunities to join forces
with your customer? The easiest and quickest scenario goes like this: After exporting
a product to your customer for a few years, you might consider producing that same
product with your customers name on it as opposed to the manufactures . Naturally,
youll need to check with your supplier to get their approval for the private label
scheme. There is a lot involved in this type of operation, so make sure the
manufacturer has a standard procedure that can easily be implemented, particularly
overseas. Once youve got their backing, suggest it to the customer.
8. Exchange information with your customer:
There are always opportunities for you
to become your customers partner in many of their endeavors. Just keep an eye out
for how you can help them to get where they want to go, not only in terms of business
but personally, spiritually, and intellectually. Give them something to reach for. For
example, lets say you sold your customer a container load of hammers. Later, you
read in the International Daily Herald about a company that makes colorful textured
plastic sleeves that slip onto the handle of a hammer, allowing the home partner to get
a better grip while pounding away. You call your customer to tell him about it and fax
him a copy of the article. Your customer is impressed because you appear to be one
step ahead of him, and pleased to see that you are keeping him, and the growth of his
business, in mind.
Offer your customer fast- breaking news, Ideas and useful contacts that will help their
business, even if they dont have anything to do with yours. If you provide them with
grocery foods but they are trying to get non- food grocery items, point them to good
52

supplier youve heard about. The more you do for your customers, the more valuable
you become to them, and the more secure a foundation you will have built.
You can find appropriate and professional ways to contribute to
your customers personal interests as well. If your customer mentions an interest in
aerodynamically designed boats, you might advice him of a boat industry trade show
soon to be held in your city. Arrange for hotel accommodations, tickets or admission to
the show, and dinner. Dont look at it as wasted time. Look it as an investment. The
rewards bonding with your customers are exponential.
You have leaded before your customers can follow. You have to act before your
customers can react. Help your customers find their way, and theyll stay with you.
9. Arrange introductions for your customer:
Arranging an introduction to an important
business contact is a gesture that demonstrates the utmost respect and appreciation in
the global marketplace. Such information can be the one of the most important and
valuable services you can offer your customers. Remember the time and trouble it took
you to build the solid foundation you have the right now with your customer. What
would it have been worth to you to have a mutual associate smooth the way? Give
your customer this benefit and strengthen your ties further- by making a few key
introductions.
This service holds particular value in Japan, where business is conducted primarily
through an official introducer, called a shokainin. A shokainin not only introduces, but
also vouches for the integrity of the individual they are introducing. If you make an
attempt to call on a customer in Japan on your own without the assistance of the
shokainin, he or she may agree to see you as a courtesy gesture, but its unlikely that
business will develop as a result of this meeting. Cold calling for a business may earn
you reputation as a bold and energetic salesperson in America, but this is viewed as
offensively aggressive in Japan. If you want to do business in Japan, enlist the help of
a shokainin. Even in countries that dont run on such a tight network of relationships,
an introductions can still open doors of your customer. Once you have undertaken this
responsibility, you must monitor the situation to make sure all goes well. If completed
diplomatically and successfully, it gains you the utmost respect in the global market.
10. Build interdependency with your customer:
53

You have served your customer, satisfied them, gone

beyond their expectations, and helped them to grow. But have you built a bond with
them that encourages them to look to you when there is a problem, or when they need
an experienced internationalists advice? In other words have you build a sufficient
interdependency between yourself and your customer? This may seem hard to grasp,
especially from an Americans perspective. We are encouraged to conduct our business
lives with an all capable, self- sufficient, every man for himself attitude, that was
fine for the driven, boom and- bust entrepreneur of the 80s. but for the global
entrepreneur laying the groundwork for the 21st century by building a worldwide
network of close connections, after sales service should be geared toward fostering a
healthy give- and take, an interdependency, with your customer.
Knowing that you have a friendly associate out there pulling
for you is comforting and adds to your confidence in everything you do. Support your
customers success in any way you can, you will be building a constructive
interdependency that can become your gateway to the world.

ADOPTING PROPER FOLLOW UP TIPS ( AFTER SALES

PROCESSES)

By Darrell Williams
It's easy to turn these first time buyers into future customers with a little follow-up.
Sending out a letter may seem simple, but it can do a lot to bring customers back and
get those customers to refer you to new ones.
Most experts recommend at least a 10-10-10 pattern when following up with a
customer. Send out your first letter within 10 days. In another 10 days, contact them
again. Then in 10 days contact the customer again. If you send a snail mail letter for
the first contact, you could use email or telephone for the following two.
Always have an offer or some other incentive that is time sensitive included in your
letter. This creates a sense of urgency. It will get people to contact you because they

54

don't want to miss out. Use the same offer through all 3 letters with the wording
becoming more urgent in each one.
The 10-10-10 method is also recommended for people who are inquiring about your
products and services. Statistics bear out that all kinds of companies, who don't get
back to people making inquiries, lose a customer. These customers tell other people
about the bad service and businesses lose even more potential customers. It seems
most businesses do not understand how important this is. It is a great way to make
future sales and it also shows that you care about not only your customers, but your
potential customers.
So what exactly should you put in your letter? Here are a few things that can be put
into the first follow-up letter. The second and third contacts should contain the same
information written in a fresh way.
1) A thank you; a heartfelt thank you for choosing your company for their purchase. A
little appreciation goes a long way. You don't have to gush, just state your thanks
simply and to the point.
"Thank you for allowing us the opportunity of providing a great product to you. I am
confident that you will be happy with your purchase and I appreciate your business."
2) A re-enforcement of why choosing your company was a great idea in the first place.
This will cut down on "buyer's remorse". Help them to feel their purchase was
necessary and buying from you was the only way to go.
3) A time limited offer. Offer them something to complement their original purchase.
In the case of a customer who has already purchased your product or service, you
could offer them a limited time offer on another one of your products or for your
service in the future. Develop a sense of urgency so the customer acts within the
"limited time".

55

Each time you contact the customer, enhance the sense of urgency. The second contact
should build on the urgency of the first and so on. The third time you contact them you
can even say something like "Only 3 days left to take advantage of this great offer."
4) Refer them to another product or service (not that of a competitor) that would
complement their purchase. Suggesting other products shows them you not only care
they bought from you, but that they are happy with their purchase. This could be an
offering from an affiliate program you belong to so that you can still make money.
5) Ask for referrals. A simple "If you like our service tell others, if you didn't tell us!"
might be enough. You can offer a percentage off their next purchase for referring a
new customer or a special offer for those they refer.
6) You should include a coupon for your services. You could encourage them to pass it
on if they are not going to use it themselves. They may know someone who needs your
services and this could mean the difference between their friend purchasing or not.
7) Attach a business card to the letter. This gives the customer something to give to
someone else when they tell them about your company. You never know how many
times that little card can get passed along.
8) Another option is to send a survey or customer feedback form. Again, offer some
incentive to fill it out. It will give you both the bad and the good of the customer's
experience with your company. This will give you information to use in your next
contact letter.
Contact your customers. Make them loyal customers who keep
coming back for more and bring new customers with them. This can be achieved by
providing after sales services to the customer by adopting the proper follow up tips.

56

CUSTOMER RELATIONSHIP MANAGEMENT

(CRM) is broad term that covers concepts used by companies to manage their
relationships with customers, including the capture, storage and analysis of customer,
vendor, partner, and internal process information. The latest CRM should incorporate
features that extend the CRM functionally beyond sales, marketing, and customer
support.
There are three aspects of CRM which can be implemented in isolation from each
other:

Operational automation of customer processes that offers support to a

companys sales or service representative

Collaborative the program communicates to customers without a companys

sales or service representative (self service)

Analytical analysis of customer information for multiple purposes

57

Thus customer service can be effective in this modern era with the use of
customer relationship management, after sales service can be done effectively by
the company only when it has proper customer relationship management.

How to Generate Money with Customer Satisfaction by giving after sales

services
As pere Earl Maghirang
Customers are the lifeblood of any business. Without customers to purchase wares or
services, it is imperative that a business would soon fold. A great way of not only
retaining old customers as well as hooking in new ones is through good customer
service before as well as it is very essential to provide after sales services for the
further expansion of the business or enterprises.
There are many success stories that can be found where the company has gained a lot
through good customer service. One solid example is UPrinting. This online printer
has made it a lifetime commitment to provide customers not only with good high
quality printed services but also provide them with customer service that they would
surely remember. Aside from the prints for posters, postcards, business cards and
canvas prints or hang tags, this online printing pioneer also assures clients that there
would always be a highly trained customer service representative waiting to help out
with even the most simple problems in their printing orders.
Customer satisfaction should always be placed in high regard in order to help earn
more money for business. If a business gives nothing but the best quality of customer
service, both during and after sales, they raise the chances of customers returning to do
business with them again. Compared to a business that only cares about making a sale
rather than taking care of their customers, the former is likely to succeed and earn
more.

58

Following or ensuring customer satisfaction also means that the customers are happy
and may tell other people of what they think of the service. Some companies such as
UPrinting gives clients the chance to air their happiness and satisfaction over the
service that they have received by putting up a specific page that shows reviews and
praises from satisfied clients.
There are a lot of things to remember in running a business but it is always important
to remember to make sure that each sale or each business transaction should leave a
client happy and willing to return in the future. This makes sure that the business lasts
longer as well as strengthens customers loyalty towards the product or service.

COMPANIES CHASE SUCCESS IN AFTER SALES SERVICE

The quality after sales experience is a key factor in customer loyalty.
Thats exactly why brand- owner companies should pause and ask themselves: do
we really want to outsource a process that can make or break a customer
relationship? Considering the level of co- ordination required among customer
contact centers, field- service operations, repair depots, warehouse operations, and
transportations logistics, improving the after sales experience can be challenging
for any company. Add antiquated IT systems to the equation, and its easy to see
why, despite misgivings, companies often outsource after sales operations.
On the other hand, some companies choose to manage their own after sales
operations. For them, following industry best practices is vital to achieving a high
level of success. In a report out of Cambridge, Mass Based Forrester Research,
Taking control of your after market supply chain, best practices to build a
foundation for reverse logistics success, Patrick Connaughton, senior analyst,
notes that winning companies not only enhance the customer experience, but also

59

find ways recoup lost profits on returned goods by taking advantage of secondary
markets to resell repaired and refurbished products.
Its been estimated that up to $10 0 billion in products move through the reverse
logistics (RL) pipeline each year in the U.S., with average return rates ranging
from as low as 3 percent to as high as 40 percent, depending on the industry. Even
with this high volume, many companies still do not invest heavily in their
aftermarket or reverse logistics operations, Connaughton says. Traditionally, RL
hasnt been viewed as a core competency by the brand owners, which results in an
appetite for outsourcing. Managing the aftermarket supply spans functional
areas, and requires redefining customer service and inventory management
processes. Forrester Research cites three steps that enable an aftermarket supply
chain transformation:

Move returns validation and avoidance upstream.

Automatic reverse logistics processes with technology.

Measures and report on performance to drive improvements.

First of all, returns can be significantly reduced by implementing additional

validation checks upstream of the distribution centers (DCs) either online, in the
retail store, or in the retail store, or in the customer call center, Connaughton says.
For instance, companies can head off costly invalid and unauthorized returns by
implementing an online pre- authorization or gate- keeping solution that
validates the return before it hits the store or warehouse. As a part of online
authorization, customers print bar coded shipment labels that streamline the
warehouse receiving process and tie the customer to the returned goods for better
case management and tracking.
Forward thinking retailers and after sales service operations also have integrated
their pre- screening systems with OEMs returns authorization systems.
Connaughton says, consequently, when UPC or serial numbers are scanned,
warranty eligibility and product exchange rules are automatically checked to
authorize the return.
The second key best practice is to automate- the reverse logistics processes using
information technology. The reality is that without right technology in place, its

60

practically impossible to enforce the standard processes required to drive costs out
of aftermarket operations, Connaughton says.
According to Forrester, companies that have been successful in reducing
aftermarket costs have focused on automating key areas with technology. They
typically include:

Use a best of breed warehouse management system (WMS) to

automate the DCs standard reverse logistics processes.

Integrate the WMS and accounting systems to trigger faster credits

improve customer satisfaction.

Apply a service part optimization solution to reduce stock outs for

service and repair operations.

Activate electronic RL B2B messaging to identify backhaul

opportunities and significantly reduce transportation costs.

Finally, as is the case with other operations, its also essential to first measure
performance, and then report on it to drive improvement.

No matter how much is invested in automation and process changes, the only
way to drive improvement is to measure the success of each program and make
adjustments as needed, Connaughton says, without this level of visibility,
operations managers navigate without a map.

Performance measurements, as noted by Forresters research, span from the executive

level to the warehouse floor and reach back to the product manufacturer. Successful
companies start in a few key areas:
Make someone accountable for each return, and measure their success to help
drive initiatives to consolidate systems and processes;

Close the feedback loop to improve product and operations quality

using product life cycle management software that not only centralizes
return- reason codes to drive design improvements, but also identifies
non- design related return trends to help determine the root cause: and

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Insert quality checks for outsourced processes, such as through use of

their own employees as quality assurance within an outsourced DC
operation.

AFTER SALES SERVICE BY PROFESSIONALS

As well as producing high quality forklift trucks, Jungheinrich also
provides first class after sales service for every aspect of your truck. So when
selecting the most appropriate truck for your application, dont just compare the
engineering and purchase costs of the truck, but consider after sales service support
you will receive with it and be sure secure your investment in the long run!
Jungheinrich after sales service offers you many advantages:
Manufacturers competence
Our service engineers are regularly trained to an excellent
standard. This ensures that any problem with your equipment can be quickly
diagnosed and rectified. From hand pallet trucks to a horizontal order picker- no one
knows our trucks as well as we do!
Mobile workshops
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Our service engineers are constantly out in the field, operating from
a mobile workshop. Tools and spare parts are carried on board, and in most cases
allow the fault to be repaired first time. Fault finding and spare parts ordering are
supported by state of the art IT solutions, so that your trucks can start operating
again within the shortest possible time.
Fast and flexible
A member of the Jungheinrich after sales service network of over
3,100 mobile service engineers can be with you within only hours 15:00 hr, required
spare parts can be delivered to you or to our service engineer the next day.
Many requirements- one solution: Jungheinrich after sales service
Jungheinrich after sales service offers a wide range of flexible services. From battery
charger services to a complete full service. With such a support network, you can
rest assured that Jungheinrich will offer solution to your requirement, leaving you to
concentrate fully on your core business

AFTER SALES SERVICES OF BAJAJ ELECTRICALS

INTRODUCTION:
Bajaj Electricals Limited (BEL) is a part of the Rs. 20000
crore "Bajaj Group" who are in the business of steel, sugar, two wheelers & three
wheelers besides an impressive range of consumer electrical products. It is a 70 year
old company with a turnover of over Rs. 1404 crores aiming to be a Rs. 2001 crore
company in the next couple of years.
Bajaj Electricals has 19 branch offices, a chain of 600 distributors, 3000 authorised
dealers, over 2,50,000 retail outlets and over 230 service franchises spread across the
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country. BEL today has five major strategic business units comprising of home
appliances, fans, lighting, luminaires and engineering & projects. We are also in the
business of manufacturing, erection and commissioning of Transmission Line Towers,
Telecom Towers, Mobile Telecom Towers and Wind Energy Towers. Export of all
BEL's products except of its engineering and projects business unit is taken care of by
group company Bajaj International Pvt. Ltd.
istory of Bajaj Electricals
The ' Bajaj ' group of India owes immense gratitude to their founding fathers whose
vision and dedication over the years has greatly helped to build a business house that
can set standards in Indian Industry.
years..
Mr. Bajaj is the Chairman of Bajaj Group companies Bajaj International and Hercules
Hoist Pvt. Ltd. and on the Board of Directors of Bajaj Auto and IDBI Bank. He was
the President of ASSOCHAM, former President of Indian Merchant Chambers (IMC)
and Council for Fair Business Practices (CFBP)
Bajaj Electricals 230 service centres and 19 branch offices in order to cater to the
after-sales service requirements for Bajaj

.
Bajaj Electricals or Bajaj Electricals Limited (BEL) is an India-based consumer
electrical products manufacturing company. Bajaj Electricals has 70 years of
experience in the electrical market and is known for being an innovator and market
leader in the Indian consumer electrical manufacturing sector.
Further, the company is a part of the legendary US$ 3 billion Bajaj Group. The parent
group of Bajaj Electricals covers areas like steel, sugar, two-wheelers, and threewheelers. BEL has aggressive expansion plans and it plans on becoming a Rs. 2001
crore company in the next couple of years. The company is headquartered at Mumbai,
India and has 19 branch offices, 600 distributors, 3000 authorized dealers, around

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120,000 retail outlets, and over 200 service franchises spread across India. Bajaj
Electricals has registered net sales of Rs. 1078.86 crore for the year ended 31st March,
2006-2007 and the company's net profit stands at Rs. 38.61 crore for the same period.

Bajaj Electricals has 5 major strategic business units like:

Home appliances
Fans
Lighting
Luminaires
Engineering and related projects
Bajaj Electricals product lines include the following Appliances - microwave ovens, mixers, irons, toasters, electric kettles, room heaters,
water filters OTGs, and gas stoves
Fans - ceiling fans, table fans, pedestal fans, wall fans, fresh air fans, and mannifique
ceiling fans
Lights - fluorescent tubes, GLS lamps, and compact fluorescent lamps Consumer
luminaries, miniature lamps
Luminaires - modern workplace lighting, Legend luminaires, commercial decorative
lighting, retail lighting, area lighting, roadway lighting, industrial lighting, hazardous
area lighting, Le Magique Luminaires, and Renaissance Luminaires

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THE GROWTH OF BAJAJ ELECTRICALS AFTER ADOPTING

EFFICIENT AFTER SALES SERVIECE

Electric Fans is a high market penetration product category and is very high in terms
of purchase priority amongst durables. It is a matured product category with a stagnant
growth rate during the period 1990-2002. it adopted efficient after sales services like
providing guarantee, warranty, replacement of the product. It adopted proper reverses
logistics which enhanced for overall development and growth of the bajaj electrical
equipments.

There are 6 major brands in the organized sector namely:

Crompton

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Orient

Polar

Khaitan

Usha
All large players in the industry have their own manufacturing facility,

which is helping them in reaping the benefits of economies of scale. Intense

competition in the market has transformed the fan industry into a high-volume, lowmargin business. To remain profitable and competitive, it becomes imperative to have
high-volumes and a reasonable market-share, to enjoy the related economies of scale.
In this severe competition too the bajaj electricals had a healthy and high profit margin
which was able because of adopting proper after sales services and adopting efficient
service centers and as per the customer satisfactions.

The Sales have grown from Rs 5730 Lacs in 1999-00 to Rs 9350 Lacs in 200203. In 2002-03, achieved CAGR over 1999-2000 of 17.7 per cent and the
projected CAGR in 2002-03 over 1999-2000 is also 17.7 per cent. This
achievement, in a sluggish market situation has been an extraordinary
performance.

Total Sales in 2002-03 achieved a CAGR over 1999-00 of 20.1 per cent &
projected CAGR in 2003-04 over 1999-00 is 19.7 per cent. The contribution of
Trade to Total sales has increased from 55 per cent in 1999-00 to nearly 80 per
cent in 2002-03.The Trade sales being sustainable and repeatable, shows a
basic strengthening of the brand and greater channel and customer acceptance.
The consistently high growth rates also reflect the above.

Growth of Bajaj Fans higher than the Industry Growth in all the years except
2001-02 & expected to be higher in 2003-04. 2001-02 was impacted due to the
high growth in the previous year and poor Institutional sales.

In 2001-02 Trade Sales grew at 10 per cent. However, lost Sales of 40,000 fans
sales (decline of 20 per cent) in CSD and 19000 fans sale (decline of 27 per
cent) to Institutions, as Bajaj was not awarded D.G.S & D Rate contract.

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After sale service (is their prime motive):

Bajaj Company attaches great importance to after-sales service. We regard customers
as our god and serve them thoughtfully and whole heartedly. We have a professional
after-sales service team, including engineers, technicians and interpreters.
We provide our customers free installation and commissioning of equipment, free
training of operators on site; one year guarantee of free after-sales service, including
free parts replacement if there is any malfunction but consumable material like filter
element is not included . Beyond the one year free service, we still provide all life
long service, including different kinds of spare parts supply at ex-work price.

BAJAJ ELECTRICALS TO ALIGN BUSINESS NEEDS WITH IT

Bajaj electrical operates through a comprehensive network of branch
offices, dealers, distributors, retail chain outlets and service franchises across India.
The company is progressing at a rapid pace recently, completed the first phase of
evaluating it business processes. Biztech2 spoke to Pratap Gharge, VP and CIO,
Bajaj Electricals, to get a better understanding of the companys plans to align
business needs with the IT infrastructure.
How does the top management assure that the IT architecture is in sync with the five
business units at bajaj electricals?
For this, we have framed an IT task force headed by our executive director and the
team including the CFO, head of commercial department, and heads of other support
functions and
We hold a monthly meeting to review the ongoing initiatives and how should they be
prioritized. Apart from this, there is a strategy meet of each of the five business units

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in the first month of the year, which is attended by the IT department to understand
the pain areas of the past year. Myself.
Finally, the IT department holds a meeting and mulls over all the pain areas faced by
the business units to come up with recommendations, based on which IT budgets are
sanctioned.
How has the networking infrastructure been scaled up, considering that bajaj
electricals operates a country wide network?
Bajaj electricals runs operations through twenty branches across the country that are
connected via converged network of point- to point lease lines to our data in
Mumbai. The branches in metro cities are connected on 500 kpbs lines followed by
tier I cities on 128kpbs. Small branches in Raipur, Wardha are networked through
64kbps lines. Our six go downs and twenty branch godowns are connected on Tulips
wireless VPN on 16 kpbs, as there is not much data traffic to handle.
We have two lease lines for internet; one for employee usage and other to connect
the dealers and suppliers to the company through their respective extranets.
The companys central data center has shifted to Dhirubhai Ambani Knowledge
Center. How does u plan to eventualise a smooth transition?
The data center has recently shifted during the previous diwali holidays. There is three
day downtime. But before we physically have shifted the hardware, there was a test
conducted for the connectivity and various other configurations. We had made sure
that the hardware is shipped after being dismantled in the right way.
Could you comment on the recent IT innovations at bajaj electricals?
We have developed customer care software to enhance our information gathering
about after sales service. Bajaj electricals operates 250 outsourced after sales service
centers across India. The customer care software to be used at these centers will allow
the company to capture the business information of the service center.
The software is offline; however there is synchronies to central server functionality
that allows user to get online four times a day and transfer the call m logs to the
central server. It will enable information gathering about customer interaction and
customer product failure analysis.

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CASE STUDY: WHY IT IS IMPORTANT TO PROVIDE AFTER

SALES SERVICE.
Below is a situation Ive met recently.
Early last month, me and my fianc went to a furniture shop to look around for
our new house.
Upon reaching the shop at chon pang, a popular place in Singapore, a lady
approached us politely and passed us some files with pictures of the furniture.
We browse through the files and she even offer to help us look for the color
and design of our requirements. In between, we make some changes on the
color we want but she is still give us that smiling face and continue helping us.
Well this is good customer service. Dont you agree? Of course, well make
some bargains seeing our idea furniture. After some discussion, she agrees to
give us some discounts as we are going to buy two products from them. After
paying a deposit we, decided to browse for our next purchase for our next
purchases of our master bedroom since we received good customer service.

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She shows as around to cupboard and dining table. Theres also discount on the
items we prepare to buy. She even wrote down the details of the items on offer,
in case when the time we come to buy, its not offer anymore.
So happily, we left the shop and decided to buy all our other furniture from this
shop. Until here, we received before sales service.
Lets see how our after sales service is like.
On the delivery day, they sent the first item to our place; we paid the balance
amount as we are satisfied with it. Later that day they sent the second item, we
found faults on it and want to change.
We called the company next day and they agreed to change another one for us
by that week. But after a week passed, still no news from the company. No
choice, we gone down to the shop again to inform them of the faults, they
agreed to send someone down to see.
A couple of days later, no one came. We called again and finally someone is
here to check. That guy said that the piece we received is a display set and its
the last one in the factory so he agreed to change for us. But weve totally
change our view on this shops service.
SWOT ANALYSIS:
Strength:
1) Furniture shop provided good before sales service.
2) Sales person was very helpful by guiding what he wants.
3) Furniture shop provided on time delivery.
4) Customer plans to by furniture from the same shop
Weakness:
1) After sales service was not satisfactory
2) Customer relationship management was not effective and appealing
one.
Opportunities:
1) After sales service which was not proper which was one of the major
weaknesses of the shop should be converted into one of their strength
by responding to the customer in time after the sales in case of some
problems with the delivered furniture.
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Threats:
1) If the shop fails to convert its weakness into their strength in the
coming days, therefore sales service and decide by future furniture from
the same shop changes in mind because of unsatisfactory after sales
service.
Conclusion:
From the above case study we can see the big difference between before
and after sales service. When a customer steps into your shop, you need to
provide both before and after sales services to assure your customers will
come back again. Does u just want to keep a customer just once or forever?
Does u know customer can become ten, hundred or even more customers
in future through word of mouth?
In order for growth in your business, grab hold of every opportunity when a
customer approaches you.

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