After Sales ServiceINDRANIL BHADURI

buyindranil@gmail.com

Why After Sales Service ?

• Economic Times :07-07-2010 India 77 per cent of Indian consumers

asserting that they will NOT make a repeat purchase or continue with a company's services in case of a bad experience

Economic Times :07-07-2010 India

"Customers want and expect high-quality service, especially as they focus on getting good value for their money in a difficult economic environment, and are willing to spend more with those that deliver excellent service -- suggesting substantial growth opportunities for businesses that get customer service right," American Express VP & GM ( World Service India)

Pradeep Kapur

Economic Times :07-07-2010 India

• As per the findings of the American Express Customer Service Barometer, 76 per cent of Indian consumers are ready to shell out 11 per cent more for excellent customer service. In fact, 67 per cent of consumers have paid more for a product or a service of a company with a good history of customer service.

Economic Times :07-07-2010 India

86 per cent of the consumers are READY TO GIVE A SECOND CHANCE to companies with a good track record EVEN AFTER A POOR EXPERIENCE

Economic Times :07-07-2010 India

While the buying decisions of 89 per

cent of Indian consumers are influenced by convenience and 90 per cent of them attach importance to value-for-money propositions, the majority of consumers (90 per cent) make their purchases based on the quality of customer service

Economic Times :07-07-2010

• If the company is successful in satisfying its customers in terms of service, it gets the benefit of word-of-mouth publicity. About 95 per cent of consumers give positive reviews about companies in case of good service in contrast to 77 per cent who speak negatively after a poor experience

Aim and Objectives

After the session is over ,you should be able to

• Explain the difference between Customer Service &After Sales Service

• Describe how After Sales Service works• Describe the role and functions of

Marketing,Logistics ,Finance and Retail • Outline Reporting Technique and Escalation

Matrix• Understand Steps for Process improvement

Customer Service Vs After Sales Service

• CUSTOMER SERVICE : Customer service is the provision of  Service  to 

Customers  before, during and after a purchase.

• AFTER SALES SERVICE : Periodic or as required MAINTENANCE or

REPAIR of EQUIPMENT by its MANUFACTURER or SUPPLIER ,during or after a WARRANTY PERIOD

History Of After Sales Process

Buyer Beware

Facts

• After sales issues are very expensive unless carefully controlled

• The cost of an exchanged product is ALMOST ALWAYS SUBSTANTIALLY MORE THAN THE SELLING PRICE OF THE GOODS

Chinese Cartoon Who said there is no "after-sales service"? Some developers

the battery did not charge even after I inserted it into the laptop

General Principles

The most common issue for customers is the LENGTH OF TIME that it takes to resolve their problems

Legal Aspects I KNOW MY RIGHTS

• What rights do customers actually have?

• What is the significance of a retailer or manufacturer guarantee?

• Who is responsible for refunds, repairs and replacements?

Sale Of Good act

1930

Sale Of Good act 1930

In this Act, unless there is anything repugnant in the subject of content

1. ‘buyer" means a person who buys or agrees to buy goods

2."delivery" means voluntary transfer of possession from one person to another.

Sale Of Good act 1930

• Sales Contract? A contract of sale is made by an offer to

buy or sell goods for a price and the acceptance of such offer. The contract may provide for the immediate delivery of the goods or immediate payment of the price or both, or for the delivery or payment by installments, or that the delivery or payment or both shall be postponed

Sale Of Good act 1930:Price

The price in a contract of sale may be fixed by the contract or may be left to be fixed in manner thereby agreed or may be determined by the course of dealing between the parties

Where the price is not determined in accordance with the foregoing provisions, the buyer shall pay the seller a reasonable price. What is a reasonable price is a question of fact dependent on the circumstances of each particular case.

Sale Of Good act 1930 Condition and Warranty

 A stipulation in a contract of sale with reference to goods which are the subject thereof may be a condition or a warranty

A warranty is a stipulation collateral to the main purpose of the contract, the breach of which gives rise to a claim for damages but not to a right to reject the goods and treat the contract as repudiated.

Sale Of Good act 1930 damage for non delivery

• Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may sue the seller for damages for non-delivery.

Sale Of Good act 1930 damage for non acceptance

• Where the buyer wrongfully neglects or refuses to accept and pay for the goods, the seller may sue him for damages for non-acceptance

Reasonable time a question of fact

• Where in this Act any reference is made to a reasonable time, the question what is a reasonable time is a question of fact.

Sale Of Good act 1930 remedy for breach of warranty

Where there is a breach of warranty by the SELLER, or where the BUYER elects or is compelled to treat any breach of a condition on the part of the seller as a breach of warranty, the buyer is not by reason only of such breach of warranty entitled to reject the goods

Sale Of Good act 1930 remedy for breach of warranty

Buyer may Sue the seller for damages for breach of warranty

Sale Of Good act 1930 damages for non delivery

• Where the seller wrongfully neglects or refuses to deliver the goods to the buyer, the buyer may sue the seller for damages for non-delivery

Sale Of Good act 1930 Buyer not bound to return rejected goods

Unless otherwise agreed, where goods are delivered to the buyer and he refuses to accept them, having the right so to do, he is not bound to return them to the seller, but it is sufficient it he intimates to the seller that he refuses to accept them

How stoppage in transit is effected

• Whether notice of stoppage in transit is given by the seller to the carrier or other bailee in possession of the goods, he shall re-deliver the goods to, or according to the directions of, the seller. The expenses of such re-delivery shall be borne by the seller

 INTEREST BY WAY OF DAMAGES AND SPECIAL DAMAGES

• Nothing in this Act shall affect the right of the seller or the buyer to recover interest or special damages in any case whereby law interest or special damages may be recoverable, or to recover the money paid where the consideration for the payment of it has failed

In the absence of a contract to the contrary, the Court may award interest at such rate a it think fit

one the amount of the price

• to the seller in a suit by him for the amount of the price.- from the date of the tender of the goods or from the date on which the price was payable.

• to the buyer in a suit by him for the refund of the price in a case of a breach of the contract on the part of the seller- from the date on which the payment was made

Check Your Understanding

Exchange

‘Dead on arrival’ (DOA)

almost all retailers will allow an exchange if the goods are damaged or not working when they are delivered.

Suppliers:3 types

Big Brands :Tell the retailers what to do and will not generally deviate

Medium Sized Companies will try to accommodate the retailers and try to retain enough margins to enable a fairly flexible policy on returns

Original Equipment Manufacturer(OEM):Operate on Bought Out Guarantee retailer not worried about “a few exchanges”

Repair

What this means in practice ?

A customer can demand a replacement rather than a repair or refund during the first six months after purchase unless the retailer can prove that the goods did indeed conform to contract, or unless the retailer can prove that a repair can be carried out quickly and at substantially less cost

Refund

Retailers will normally resist giving refunds for two reasons:

Lost sale

Lost Value

GUARANTEE

• AGREE to be responsible for another's debt or contractual performance if that other person does not pay or perform.

• Usually, the party receiving the guarantee will first try to collect or obtain performance from the DEBTOR before trying to collect from the one making the guarantee (GUARANTOR)

• The promise to pay another's debt or fulfill contract obligations if that party fails to pay or perform

• A Promise To Make A Product Good If It Has Some Defect

WARRANTY

Consumers Rights in India

ITS HOT……CONSUMERS RIGHTS IN INDIA

What do Customers Want?

Almost everyone in Business is trying to figure out What do Customers Want?

The answer is generally very simple a good-quality product, and to be

treated fairly if there is a problem with the product.

That’s easy, then, so why does it go so wrong?

so why does it go so wrong? …

• Ironically, if the various consumer protection acts were a little clearer and more definitive then customers would probably be less demanding

• Some of the biggest reasons are• 1.Fear :What if our competitor knows it and apply

the same ?• 2.Lack of understanding :marketing department

hardly knows how the after sales work and vice versa

• 3.A belief or understanding that their capabilities are perhaps less than perfect

Back Bone of After Sales service

• Fast response to problem resolution• Dependability• Flexibility• Diagnostics and first-time fix rate:

simple to use self-help procedures• Compromise An ability and a willingness to meet

customers halfway is a very powerful asset in after sales care

Back Bone of After Sales service

Information

Resolution timescalesTo generate real credibility, companies

must publish and stick to set timescales for time to complete

What do Sales People Want?

Essentially, sales staff want the same things that customers want

PROCESS DESIGN

5 keysONE check basic functionalityTWO collect all accessoriesTHREE make sure that the customer

has contacted the service deskFOUR check guarantee validityFIVE Check for misuse

PROCESS DESIGN contd..

Data recording

Escalation processes

Escalation Process

• Most important tool

• Route to reach the suppliers and manufacturers

Escalation Matrix

Problem Resolution Timeline

• REASONABLE TIMESCALES• TIME TO RESPOND –ensure a prompt

response(Call Centre)• FIRST-TIME FIX: realistically it is usually not

possible for a repairer to visit immediately(Electrical :20-60%,Furniture :80-90%)

REAL SCENARIO : CUSTOMER SCALE OF TOLERANCE

• Day 1 :Customer Frustrated but understanding

• Day 2 to 7:mildly agitated• Day 8 to 14:geninely

frustrated ..regular calls• Day 15 to 21:Losing patience • Day 22 to 30:Agry Customer and

calling everyday• Day 29 and Over :Furious and threats

of legal action

Mr.Vs Mrs Angry

Role Play

Supplier Management

This is the area that most retailers get wrong:

‘It’s all your fault’

‘It’s not our fault’

Questions Retailers ask….

customer name customer address customer telephone number brand model numberproduct groupdate of purchasedate of delivery (if major difference)date of exchange fault historymost recent fault descriptionreason for exchange

Questions Retailers ask….

delivery number (if appropriate) consignment number (if available) store or outlet name/number name of person requesting exchange store authority number In Home or In Store date of collectionreplace or refundrepairer name (if appropriate)Supplier Management and Reverse Logistics age when exchanged (days)supplier exchange reference number.

Questions supplier ask….

• How old it is?• What went wrong?• Why it was replaced?• What was the background to this and

why was it not simply repaired?• Under what authority the retailer is

expecting to return it to the supplier?

Logistics : Forward Logistics

Logistics : Reverse Logistics

Check Your Understanding

Forward –Reverse

Difference Between Forward and Reverse Logistics

8 Frequently Used Words in Customer Complain

Not working’‘Not working properly’‘Dead’‘Faulty’ ‘Noisy’‘Uncomfortable’ ‘Faulty’ ‘Broken’

Reporting Technique

Work It out

• Exchange costs – non-bought out guarantee• Exchange costs – with bought out guarantees• Repairs costs – non-bought out guarantee• Repairs costs – with bought out guarantees• Combined costs• Exchange costs – potential savings• Repair costs – potential savings• Net projected savings

Beyond Economic Repair(BER)

State of a repairable item where its estimated repair cost  significantly exceeds a certain percentage (typically 80 percent ) of its replacement value

Dead on Arrival (DOA)

(Medical) Dead on arrival or D.O.A. (also dead in the field) is a term used to indicate that a patient was found to be already clinically dead  upon the arrival of professional medical assistance, often in the form of first responders  such as emergency medical technician. paramedics or police

D.O.A. is also frequently used as slang  to indicate a new item that was received broken, or that an idea or concept is a nonstarter

Dead on Arrival (DOA)

Entry Price Point Goods

Original Equipment Manufacturer(OEM)Bought Out Guarantee (BOG)

Goods direct from the factory gateORThrough a handling agent OR distributor for their ENTRY PRICE POINT

and BUDGET SALES LINES guarantee is sacrificed in exchange for

higher margins (ie the buying-in price is reduced)

Supplier Specification

• Dimensions• General properties• Colors• Transport conditions including

packing within containers• Boxes and protection• Consignment size and make-up• Parts and accessories

EXTENDED Warranty

3 key drivers of extended warranty costs

1.Frequency of claim2.Average labor costs3.Frequency of parts replacement and

net cost of parts

Pareto Principle

Check Your Understanding

Quiz Time

After sales Service –Mercedes Benz

https://portal.aftersales.i.daimler.com/public/content/asportal/en/home.html

BMW after sales service

• http://www.bmw.com.my/com/en/general/bmwowners/after_sales/after_sales_03.html

After Sales ServiceINDRANIL BHADURI

buyindranil@gmail.com