The ‘Customer’ (or ‘consumer’) or Market is normally used interchangeably nowadays that very few people still understand their differences.
The customer is a person or an entity which is able and willing to pay you for your product or service. The notion that the Customer is always right, will always be the most important part of the sustenance of any business. It doesn’t matter the amount of investment inputted in the operations of any business venture. Should there be no customers paying for the product or service you are rendering, you will be out of business.
Now you understand why many successful businesses perceive that ‘The Customer is King’. If the customer is the most important part of any business venture, what do you think every entrepreneur must know before they even begin operating a business?
You’re right. You must first know your customers and the best ways to satisfy their needs.
Let’s use for example:
A poultry farmer as a case study for the question below.
From your business plan you should be able to tell how much you will spend on a single bird based on the preferences of your customer, to make good profit margins.
With a feasible business plan in place you need to answer these 7 questions about your potential customer:
- Who is the customer for the birds you produce? Examples can be households, cold stores, caterers, restaurants, hotels and schools among others
- What they want? Eggs, live birds, carcass or frozen, wings, or chicken chest
- How, where they want it? –town, district, selected regions or nationwide delivery
- When they want it? -weekly, monthly, festive season or occasionally
- What doesn’t your customer like about the product or service you are rendering? – It might be that you don’t meet the carcass weight, your farm is not recognized by the veterinary or other regulatory agencies, you insist to sell live birds or you don’t handle the birds well.
- How much can your customers afford for your birds? – What is the current market price for your birds, what is unique about your service that requires your birds to be below or above the current market prices, what is the income range or distribution of your customers
- What is the preference of your customer in pricing your birds? – carcass weight in kilograms, live weight in kilograms or live birds regardless of weight
Understanding your customer means that you should constantly look at your business from the viewpoint of your target customer. It doesn’t matter what you are comfortable with, tastes and preferences are, if customers don’t want or like what you’re selling, they won’t buy it. And if they don’t buy it, there is no business.