Customer Satisfaction

Peter Drucker, father of modern management, once said, “The purpose of a business is to create and keep a customer.”  That makes sense, but somehow we lose track of it in our pursuit of fixing problems and refining our processes.   

 

Never forget, it’s all about the customer. 

 

Keeping a customer starts with customer satisfaction.  Seems pretty simple, but the business world is a graveyard of companies that simply don’t do this well.   

 

How do you know if your customers are satisfied? Are you simply waiting for them to come back to purchase more? Hoping they will refer your products and services to others?  The good news is it’s not just a wish and a prayer anymore.  Bain & Associates, a US-based consulting firm, developed a simple and practical customer survey several years ago called the Net Promoter Score.  The higher you score, the more satisfied your customers are and the more likely they will repeat their purchases and refer you to others.  Google NPS (net promoter score) to learn more.   

 

So what does customer satisfaction have to do with business value? 

 

Turns out, buyers of your business will pay for a high NPS score. Remember, they are buying the future and trying to minimize risk - the more predictable future sales are, the less risk – and the bigger to check to you.  Knowing current customers are satisfied and likely to repeat purchases and refer is a major driver of multiple and value.    

 

The game of business ownership is to create wealth.  For most owners, that is the end goal – to create wealth, exit on their terms, and to ultimately empower the next generation of ownership.  But increasing value is not only about the end game.  It starts with what you are doing right now to drive value that in turn provides more income today, along with wealth and options for tomorrow.