Customer service is the measure of how logistics is creating the time and place utility for a product. The meaning of customer service varies with the organization the product it is marketing and the transaction phase it is undergoing the buyer looks for value for the money he is spending, while the seller, in delivering superior customer service, looks for a trade-off between cost and customer satisfaction.
Hence, customer service depends on the phase of the transaction it is passing through. There are three phases associated with the exchange process. The degree of importance of each phase varies with the organization and depends on the product and customer requirements to maintain smooth supply chain management.
Customer service during the transaction phase is associated with routine tasks performed in the logistics supply chain. These tasks need coordination for the entire system to be efficient and effective in delivering service to the customer per the desired standard. The following are the various service elements associated with the transaction phase:
Order fulfillment reliability
In the transaction phase, the most important factor is the reliability to fulfill the order within the agreed time frame and also with respect to the quantity and quality of the material ordered. This depends on the close coordination and management of the various components of the order cycle such as order processing, material planning allocation, picking, packing, and transportation. The customer’s production schedule is very much dependent on the reliability factor of order fulfillment by the supplier.
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The other important factor in the transaction phase is the consistency of delivery of repeat orders. Let’s say out of 100 deliveries only 60 are on time while 40 deliveries deviate from the agreed schedule. Now, this likely to cause production interruptions at the customer’s end, and the customer will surely be dissatisfied with such inconsistencies. The inconsistency of delivery may be because of problems with the various elements of order fulfillment that need system improvement as well as for better supply chain management.
Order convenience is the ease with which the customer can place an order. The barriers to convenience are the paperwork required by the supplier, compliance to various procedures complex payment terms poor communication network at the supplier’s end, and poor coordination in the marketing network of the supplier. In competitive markets, these barriers may lead to opportunity loss and warning of the customer base.
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The customer, for some reason, may require an entire order or a part thereof to be postponed or executed in parts, in a phased manner. This may be due to the rescheduling of requirements at the customer’s end. In another case, due to the availability of a certain product category in the future, the seller may ask the buyer to place the order now and ship the product when it is available on future dates.
A situation may arise that the product ordered can’t be shipped due to certain manufacturing or quality problem. The seller may extend the service by offering a substitute product of similar or better quality in different sizes or from the available brands in the market (on the same terms and conditions) in order to keep the relationship and retain the customer during transaction phase. For obtaining the customer’s consent for a product substitute, the seller needs closer interaction and clear communication with the customer. So all of these are very important in customer service.