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Explanation of how to Satisfy Your Customers to Increase Business and Reduce Losses - Strategies to Succeed with Total Quality Management (TQM). Also refer to expectations, specification, product, goods, service, repeat, referral, dissatisfied, complaint, returns, negative, profits, Ron Kurtus, School for Champions. Copyright © Restrictions

Satisfy Your Customers to Increase Business and Reduce Losses

by Ron Kurtus (revised 6 June 2007)

Your customer is the person or even company that pays you for your goods or services. Your goal in business should be that these customers are satisfied and even delighted with what you have provided them. Satisfying your customers results in repeated business and referrals for new business. Dissatisfied customers can result in complaints, returns and negative publicity. This can cause you to lose money and have fewer customers in the future.

Questions you may have include:

• How do you satisfy the customer?
• What are the benefits of customer satisfaction?
• What can happen if your customers are unhappy?

This lesson will answer those questions. There is a mini-quiz near the end of the lesson.

Satisfy or delight

When a customer purchases a product or service from your company, that customer expects it to perform as advertised or according to specification. There are also unstated expectations and of performance and reliability. Customer satisfaction or delight is when the product or service exceeds expectations.

For example, we recently purchased a new, inexpensive Toyota Corolla. After driving the car, we were delighted with the high gas mileage and various features of the car that you would expect in a more expensive automobile. To top it off, the Toyota dealership provide excellent service as a follow-up to the sale. No wonder Toyota is such a successful manufacturer.

Benefits of customer satisfaction

A satisfied customer will often be a repeat customer. Also, the customer may tell other people and referred them to your business. This means that you not only have a source of continuous business, but you also will get new business. This can save your company money that might be spent on advertising. Repeat business and word-of-mouth advertising are the best ways of maintaining a healthy business.

Perhaps you've gone to a restaurant where the service and the food were excellent. You probably return to that restaurant again and even brought some friends along.

Companies that do business with other companies can also see the benefits of customer satisfaction in establishing long-term business relationships.

Dissatisfied customers

When customers are dissatisfied with the quality of the product or its reliability, they may voice some complaints. In such a case, you can solve a problem and rectify the situation such that the customer goes away happy. But that type of customer service will cut into your company's profits.

The greater problem is that only a small percentage of the dissatisfied customers will actually complain. But they will tell their friends about their dissatisfaction. It is estimated that an unhappy customer will tell up to 15 other people of their dissatisfaction. This is a considerable amount of negative publicity for your company. This is a major reason some businesses fail.

Although a customer may be satisfied with the product received, if the service that comes along with the product is poor, they may hesitate in recommending your store or business. If you went to a restaurant that had excellent food, but the waiters were rude and the service was slow, you would probably not return. Timeliness is part of the service is provided to customers.

Summary

Your goal in business should be that your customers are satisfied and even delighted with what you have provided them. Satisfying your customers results in repeated business and referrals for new business. Dissatisfied customers can result in complaints, returns and negative publicity, causing you to lose money and have fewer customers in the future.

Answers to Readers' Questions

A happy customer is a repeat customer

Resources

The following are some resources on this topic.

Web sites

TQM Resources

Books

Top-rated books on Business Quality

Top-rated books on Six Sigma

Miscellaneous

Mini-quiz to check your understanding

1. How can you satisfy your customer?

2. What is the result of customer satisfaction?

3. Why would you worry if a few customers complain?

If you got all three correct, you are on your way to becoming a Champion in Total Quality. If you had problems, you had better look over the material again.

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Satisfy Your Customers to Increase Business and Reduce Losses