Logistics as Customer Service

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This presentation discusses how the quality of logistics operations can leave a deep impact on customers and what impact it can leave on customer service. Also helps understand management about the …

This presentation discusses how the quality of logistics operations can leave a deep impact on customers and what impact it can leave on customer service. Also helps understand management about the tradeoff between service levels, related costs and their impact on the bottom line.

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  • 1. Logistics & Customer ServiceYonus SiddiquiVice President Projects,e2e Supply Chain Management (Pvt.) Ltd.FOUNDER SCAPFOUNDER & CEO SCCDI
  • 2. Tale of Two Customers BUILD A SCENARIO FOR EACH
  • 3. Choose your product
  • 4. Why customer service? Commodity nature of products Cost sensitive customers Cost pressures The 3rd P of marketing Difference between you and your competitors is based primarily on price OR customer service
  • 5. Service Objective To create such a level of satisfaction with customers that they do not feel it necessary to consider alternative offers or suppliers.
  • 6. What is Customer Service ? Three main components  Pre-transaction elements  Transaction elements  Post Transaction elements Core Product Delivery frequency, reliability & consistency Ease of contact Features Ease of transaction etc. Quality Durability etc. 6
  • 7. Customer Service Drivers • Order booking • Handling Process • Documentation • Feedback • Software • Tracking Tools • Technology • Website • Ownership • Commitment Culture • Teamwork • Care & focus
  • 8. Customer Service Economics  Define customer service objectives  Write a customer service policy  Remember !  Pareto’s law  Law of diminishing returns. 8
  • 9. Customer Cost of ServiceServiceEconomics 0 Service Level 100% Diminishing ReturnsGraphically Service Sales Revenue Overkill Service Zone Threshold Level 0 Service Level 100% Revenue Cost Profit 9 0 Service Level 100%
  • 10. Setting Service Standards Set your priorities right 5% {  Apply Pareto (80/20) rule to both products 15% and customers % Sales / Profits View service decision as a resource allocation issue 80%  Profits vary by customer & by product  Measure of importance should be PROFIT A B C rather than sales or volume 20% 50% 30%  Contribution margins of each product 0 % Products / Customers 100% SKU to be reviewed separately 20% Customers buying 20% products Develop service policy / standards equals 4% of all transactions  Key accounts Which will provide:  Inventory levels  Stock point positioning 80% of 80% of total profit = 64% profit 10
  • 11. Service Standard ExamplesRequires a clear and objective understanding of customer’srequirements and willingness to shape those expectations. Order cycle time  Delivery reliability Stock availability  Documentation quality Order size constraints  Claims procedure Ordering convenience  Order completeness Delivery frequency  Technical support  Order status information 11
  • 12. Bottom Line Impact for customers Lower inventory  lower working capital No headaches  life is enjoyable Timely supplies  more sales / availability Improved profitability  preferred supplier
  • 13. A Positive Feedback on Logistics The service during my pick up was great. They were very thorough and careful with all of our things. While my things were in transit, your service was also good. I received calls and emails with updates. Also, whenever I had questions, they answered them all to my satisfaction. Your service during delivery was also very great. The guys were very nice and efficient. I can say that you certainly delivered my things on time. I will definitely recommend your moving services to others, thank you!
  • 14. Question / Answers