Supply Chain Management Journal
Impact of Customer Service Logistics Strategy in the Trading Enterprise X Paula BAJDOR Janusz K. GRABARA Częstochowa University of Technology
[email protected] Abstract This article presents the logistic support for the customer service logistics strategy in the trading enterprise. After presenting the most popular definition of logistics customer service and then a brief characterization of the enterprise, a further part of the article is dedicated to the customer service logistics strategy, which is used in the trading enterprise X. Keywords: logistics strategy, customer service, trading enterprise Introduction One of the important factors of business success in the market is to use the marketing mode of action and consumer recognition for the central level, which is the main needs of meaning and purpose of every business. Ph. Kotler, a famous economist, considered by many to be the marketing guru, says that "only aimed at the client company can be successful” (Pantee, 2007). The term "customer service" is a term difficult to define because its scope covers a very wide area, ranging from the first contact between the supplier and buyer, including the elements of intangible and material. Logistics efficiency is obviously an extremely important factor in meeting the needs of the client and the model is the basis for the relationship between customer service, customer relationships and maintaining them (Christopher, 2005). Referring to the logistics customer service can be defined as "providing the customer the right product at the right time and right place” (Christopher, 2008). This reasoning can be seen the worthlessness of the products until their transfer to the disposal of the customers. This is because they minimize the differences between the products offered by different companies (Popa, 2010). The company wanted to stand out
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against competitors trying to improve the quality of customer service by offering additional benefits associated with the transfer of goods and services. The starting point for reflections on customer service should be the assertion that the importance of the concept of customer service goes far beyond the area of interest in logistics. On the logistics customer service consists of "various factors shaping the process and activities to share products and services of the buyer. Most are related to the adoption of the contract, its complementation, the transfer of goods recipient, settlement claims, and even further the care of the product sold” (Ciesielski, 2006). In turn, LaLonde and Zinszer cite a number of views on how it can be provided a definition of customer service (Waters, 2007): • As all the actions which appear necessary in operations such as receiving, preparation and implementation of financial and customer service, while eliminating the activities defined as abnormal, • Timeliness and reliability of supply to customers in accordance with earlier findings, • It's fully integrated operations that involve all areas of business, in order to provide products and billing the
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customer in a satisfactory manner and contributes to progress in achieving the goals set by the company, • The complexity of procurement activities in the area, the area of communication with customers, loading and transport, invoicing and control of products and implementation of complaints concerning defective products, • Timely delivery of products exactly matching the order with a careful examination of the relationship and delivery of the invoice. In the simplest terms, the definition of customer service is a "set of actions defining a direct relationship between supplier and customer relationships with the flows of goods and information” (Baraniecka, 2005). Despite the fact that there is no clear definition of customer service providers primarily see it as three levels of engagement, which are characterized as follows (Dobrzynski, 2002): - Customer service as a kind of activity. At this level of customer service is regarded as a primary task, which the company must meet to satisfy the customer. The first level of customer service is associated with physical distribution at the operational level. Examples of activities relating to this level are: the process of receiving and order processing, invoicing, shipping, receiving and returns, etc. activities related to customer service include operational planning, cost calculations, inventory management, billing of supplies or preparing the necessary documentation (Kempny, 2001). Customer service is a complete all these activities, which is the fundamental duty of a particular company or organization. Despite the correct and reliable performance of these duties, they often do not bring the desired result, the result may be far from the expected, - As a measure of customer service excellence. At this level of customer service is examined in terms of certain specific measures, for example, the percentage of orders delivered on time or before an agreed number of orders that was developed in a timely manner. In the context of measures of excellence can be assumed that customer service is
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understood in a broader way, but despite this, it should be remembered that to achieve complete customer satisfaction is the most important thing, not just focus on measures (LaLonde, 2005), - As a philosophy of customer service. At this level of customer service (considered as a management philosophy and mission of the company) is raised to the commitment that the company will ensure compliance with customer requirements in their entirety by the excellent level of service. Customer and his orders are treated as unique and sophisticated. In the literature it is noted that this is rather a marketing concept of service, having little effect on the concept of logistics management. The essence of the strategy in the enterprise The strategy originally meant the main department of military art. Cover the theory and practice preparation and conduct of the war as a whole and its individual operations and campaigns. By analogy and in accordance with the original meaning, the strategy is the art of command development organizations and to choose methods and means of achieving the goals of the organization (Kempny, 2001). Strategy of the company or otherwise, any organization is now understood in many ways. Among the many definitions of the most interesting and useful for further discussion about customer service approach is H. Mintzberg. In his view, the strategy defines five words: plan, ploy, pattern, position, perspective (Mintzberg, 2007). The strategy in the first sense is consciously intended course of events, to achieving the objective. This means, that it knowingly and intentionally formulated a plan to prepare and precedes action (Obloj, 2001). Importance of another strategy, if it is understood as a ruse, which is unexpected for the opponent of market maneuver, invented in order to deceive him. In this case, opponents may be (Sznajder, 2005):
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Supply Chain Management Journal
• competitors, companies producing and selling in the market the same product, • market rivals, the companies producing other goods, but competing for customers, who can spend only purchase certain amounts of income, • opponents, which is hampering all business activity, as well as some competitors and rivals, • enemies, or those who want to absolutely destroy the company. The strategy as a pattern is a consequence of the practical activities. Strategies can emerge not only because of deliberate plans or projects, but also of human behavior in a certain, not entirely conscious and planned, manner (Starostka-Patyk, 2006). On the other hand, where there is no persistent action, even very wellprepared plans are not realized. Understood in terms of strategy emphasizes the pattern of any real signs of activity and determination in practical activities. Practical means to maintain activity even when there is no deliberate plan of action and future prospects, but this activity they may emerge (Gierszewska, Romanowska, 2005). Strategy as the art of seizing and defending positions in an environment in which it operates, it means the opportunity and freedom to present and further action. In this case, the strategy is the ability of "being" way to get its "due" place in the environment and way of communicating with the environment and use it for their own purposes. The preferred location gives prospects for the future (Gierszewska, Romanowska, 2005). Comprehension strategies in the category of views on the future or discovering the future, with equal determination as to take practical action, is the closest to being what we call today the development strategy of the organization or strategic thinking. Prospects for the organization depends on its position, behaviors, and broadly defined resources. Express its temperament, personality and imagination, as in the concrete man, and the mentality of how critical perception of the world (Jezak, 2000).
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This aspect of the strategy conceived so deeply affected by what is called strategic thinking, including (Branicki, 2007): • ability to create and maintain in the mind of the representation of something that is not currently present, • the intention manifested in the possession order, intentions, and plan to achieve this in some way, • flexibility to the ability to discover multiple ways to achieve when you do not check the initial plan. Customer service strategy is seen as a perspective, plan, stratagem, and finally a pattern of action in order to maintain or take a specific position in the market. The characteristics of trading enterprise X The trading enterprise X was founded in 1990 and has its headquarters in Piotrków. President and vice president are also the owners of the company. Since 1994, the company has the status of protected workplace. The decision to grant this status very significantly influenced the dynamic development of the company - it has expanded its business activities such as packing of goods, warehousing, transport and logistics. These activities are also significantly influenced the increase in the number of disabled persons employed in the enterprise. But the main business domain is still in wholesale groceries. The company has a fully organized warehouse with full warehouse and wholesale. Since 2001, next to the company operates a distribution center, which is one of the most modern of its kind in Poland. The center is located in the high bay warehouse with an area of 5000m2, having administrative and social facilities. So great storage space allows to store the products in proper conditions and placing them in an ergonomic way. A suitable storage policy helps to avoid problems associated with the destruction or damage of goods. This allows maintaining their quality until delivery to customers. In its product range the company has over 5,000 products from 70 well-known manufacturers such as Nestle Poland,
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Supply Chain Management Journal
Ferrero Poland, Aurora, Lu Poland, Solidarity, Bahlsen Sweet, Hortex, Agros, Alima Gerber, Nutricia Poland, Kraft Foods Poland, Mokate, Tchibo, Mars Poland. With such a wide and diverse wide array, the company is able to supply its customers in the most complementary manner and at the same time meet their most exorbitant demands. For several years the company has also the ISO 9001:2000 certificate. Management system based on this standard provides, among others: Proper circulation of information, a clear division of responsibility, accuracy and process control activities under this system, prevent any inconsistencies. The company contracts in its portfolio brands that are well known and popular in Poland. These are brand recognizable both by adults and by children. But the biggest company generates revenues from sales of Wrigley brands. The products of this brand, mostly chewing gum, from the very beginning of the start of operations by the company, accounted for approximately 60% share of sales of all products offered by the company. Behind the Wrigley brand ranked Ferrero chocolate products offering both for adults (Ferrero Rocher chocolates filled with coconut) and children (Duplo chocolate bar, Kinder Bueno). Next, followed by brands such as Mars, Wedel, Nestle, Tchibo, Van Melle as having equal shares in total sales. Assumptions of customer service logistics strategy in the enterprise X The main objective of the company X is to maximize profit and continuous increase in the number of its customers. The customer is the final recipient of the products offered by the company and what the end result is his satisfaction or dissatisfaction, is a condition of the company, mainly financial. The company is acutely the case that the strategy of customer service is one of the most important issue, because it mainly depends on the client whether it will survive in the market, beat competition and will be developed. Therefore, the logistics strategy of customer service,
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next to the equally important issues such as financing, economic condition, investment strategies, is a question of never losing to the news. Nowadays, even the best and cheapest product does not ensure the success of the company, when it will not have well-developed structure of customer service. Activity that leads the company X is a very popular activity, on the Polish market exists and operates a very large number of traders engaged in wholesale groceries. Therefore, company X is used increasingly sophisticated methods to attract new customers, while strengthening ties with a regular customer. Nature of business X allows for direct contact with the client but not in the direction of the client when it comes to the office of the company, but the customer contact is in a way that when a sales representative or vanseller comes to offering products of the company X. The main tasks of sales representatives and vansellers should be continuous and maintaining contacts with existing customers as well as the continuous acquisition of new customers. The customer service logistics strategy is implemented at the time of the first order placed by the new customer. Based on the answers given by the customer, its profile is created. It helps in the selection of products corresponding to most customers. Then these data are entered into the computer and the client is attached to a large enterprise customer database. From now on all transactions and customer contacts will be immediately entered into the system for the most current information about a client. When a client calls, the database indicates whether a representative example of his pre-ordered and available when products are in stock, or if the customer paid the invoice late. The company has built its customer service logistics strategy on four basic elements of customer service such as: time, reliability, communication and convenience. Time - the company tries to minimize the time of the contract does not exceed 24 hours. In practice, it looks that the representative visiting the client, has
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Supply Chain Management Journal
in the car a wide range of products which are the products most frequently purchased by the largest number of clients, such products include all chewing gum, drops, tic-one bars. Most vansellers and sales representative are able to sell products at the time of ordering by the customer. When a customer orders a larger quantity of goods or merchandise that is not on the car, a representative enters a product code in his portable device that has a direct connection to the database on the main warehouse of the company and the transfer of whether the goods are in stock magazine or not. Where the goods are in stock and is it’s enough to fill the order, sales representatives brings the merchandise to the customer on the next day. When the central warehouse also lacks the goods ordered, this information reaches the employee responsible for purchases directly from manufacturers, who a moment later an order from the manufacturer on goods temporarily missing. In this case, the time the contract is extended to 48 hours but these are very rare cases, because the vast area that has a company store allows to have all the goods of a bidding company. And as it has been known time plays a very important role in the implementation of the contract, because customers are much happier when their ordered products are waiting as short as possible. Even a short delay, which can occur even through no fault of the company, may result in loss of customers. And if a few key clients who are customers of fixed and have a significant impact on the size of the revenues generated by the company, when they want to purchase goods in a warehouse located in the company, the sales representative sends the appropriate information and the company just sends the ordered goods using vehicles that are just across the enterprise. Reliability - in this case, reliability is the order within 24 hours. The constancy of the 24 is very desirable by customers because they are thus able to plan their sales, size of captive stocks and the size of placing an order, and thus pay for it. Any delay in delivery of goods, as mentioned previously may result in loss of
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customers. In case of delays, but is observed, the company is trying to tell as soon as their clients, because when they warned earlier, this will come easier to them than if they accept the fact that information came to them suddenly. Therefore, at least 2 times a year, the company through their sales representatives and vansellers sends information to its customers containing a warning about the possibility of exceeding the delivery time for its duration above 24, the periods in which delays are most likely a period of Christmas and the beginning of the holiday. Communication a two-way dialogue that takes place between the sales representatives, vansellers and buyers, or customers. Good, efficient and convenient communication often determines the efficient cooperation between the two parties. Sales representatives and vansellers are obliged to inform the customer of any changes in the company - withdrawing or introducing new products to offer, changes in product prices, changes in the rules of trading, changes in forms of payment. And also informed of any promotions, rebates, discounts, food fairs organized by the company, provide all information concerning the activities of the company sales. For their part, sales representatives or customers informed about the date eg. Holidays or closing-days, the transitional difficulties in payments, extending or shortening of their shopping lists, and many other things from the point of view of a sales representative or vansellers can be crucial to maintain an adequate level of customer service. Convenience - customers can have different behaviors and needs, so the customer service logistics strategy pursued by the company must assume some flexibility. On the other hand, business customers have some common characteristics - most are shopkeepers, having a smaller or larger shops, and their behavior, however, are similar to each other. The flexibility of the corporate strategy manifests itself, inter alia, that in this case when a client asks for an unusual time of delivery, the order is completed with adequate time for the
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Supply Chain Management Journal
customer. In this case, the customer service logistics strategy is to bring to the process of ordering and receiving products was the process as comfortable as possible for customers, this also involves a system of payment for products, and customers have many options here to choose from: cash, transfer, and installment lending. They can also make use of the deferral of payment if at the time of receipt of the goods they do not have sufficient numbers to allow pay cash commitment to the sales representatives or vansellers. Last year, the company formulated a philosophy of customer service, which takes into account the real needs of customers; it includes standards for customer service in the company, which indicate how the client will run collaboration between him and the company. Conclusion Customer service is a basic issue in marketing and logistics while essential link of marketing and logistics. If the logistics system, especially the logistics of distribution, is not functioning properly, and the client does not receive the ordered product or service, the company may lose market position. The essence of logistics customer service is the fact that a customer buying a product or service, purchases other advantages associated with this purchase. Thus the value of the product for the customer, is the sum of the value of the product and service standards. There are many aspects of logistics customer service, it is not limited to activities related to the execution order cycle. It shall also ensure customer service standards specified level of performance or meeting their basic elements. The starting point for ensuring adequate levels of logistics customer service is to realize the role of this issue, because customer service is the most important task of the whole logistics system. The most optimal treatment would be the logistics customer service as a management philosophy and mission of the company, which was related to the
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subordination of the entire business customer needs and methods of meeting those needs (Cotirlea, 2011). Despite the high quality of customer service, the company continues to make any solutions and innovations to further improve customer service, employees regularly participate in training, and every quarter, each agent receives a questionnaire which transfers the customer to comply with it. This survey contains standard questions about the customer service process by the company. Filling it, the client has the opportunity to draw attention to errors or shortcomings of the company in this area and subsequent improvement of the point. References Baraniecka A., Radowska B., Skowrońska A., „Logistyka ćwiczenia”, Wydawnictwo Akademii Ekonomicznej, Wrocław 2005. Branicki M., „Strategiczna reorientacja dla budowania konkurencyjności przedsiębiorstwa wokół wiedzy”, TNOiK, Kraków 2007. Christopher M., Peck H., „Logistyka marketingowa”, PWE, Warszawa 2005. Christopher M., “Logistyka i zarządzanie łańcuchem podaży”, Profesjonalna Szkoła Biznesu, Kraków 2008. Ciesielski M., “Logistyka w biznesie”, PWE, Warszawa 2006. Cotirlea D., „Issues regarding e-service quality management – customization on online tourism domain”, w: Polish Journal of Management Studies, Czestochowa University of Technology, Czestochowa 2011. Dobrzyński M., „Logistyka”, Dział Wydawnictw i Poligrafii Politechniki Białostockiej, Białystok 2002. Gierszewska G., Romanowska M., „Analiza strategiczna przedsiębiorstwa”, PWE, Warszawa 2005. Jeżak J., „Strategiczne zarządzanie przedsiębiorstwem”, Uniwersytet Łódzki, Łódź 2000. Kempny D., „Logistyczna obsługa klienta”, PWE, Warszawa 2001. LaLonde B.J., „Customer Service, The Distribution Handbook”, The Free Press, NY 2005.
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Mintzberg H., „The strategy concept”, California Management Review, 1/2007 Obłój K., „Strategia organizacji”, PWE, Warszawa 2001. Pantte D., „Marketing w małej firmie”, Wydawnictwo Profesjonalnej Szkoły Biznesu, Kraków 2007. Popa V., „Supply Chain Excellence through Practicing Collaborative Business Process Standards, Proceedings of the 4th Symposium ECR Academic Partnership – România: Supply Chain Management for an Efficient Consumer Response. SCM4ECR, Valahia University Press, 2010
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Starostka-Patyk M., „System wspomagania decyzji dla strategicznego zarządzania logistycznego”, w:Rozwój lokalny i regionalny po wejściu Polski do Unii Europejskiej. Praca zbior. pod red. Anny Barcik i Ryszarda Barcika. T.2., Wyd.Nauk.ATH, Bielsko-Biała 2006 Sznajder A., „Strategie marketingowe na rynku międzynarodowym”, PWN, Warszawa 2005. Waters D., „New Directions In Supply Chain Management”, Kogan Page, UK 2007.
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