Delivery Double Penalty

One of our customers recently remarked that he wanted to reduce his follow up visits to our plant as it wasted his as well as our time.

Another of our customers sent us mail asking us to instruct our bankers to accept a 3% penalty on our bill for late delivery.


The Connection

The first one is obvious.

Each time a customer calls or visits us, at least, one resource has to attend to him or his call. The objective of the call is just to inquire about the status or for a follow-up of a particular order. e.g. Thee last time a customer walked in we had planner + manager + production in charge in attendance.

This means our resource is basically rendered useless by one engagement instance with the customer. If it’s a phone call it lasts for 3-5 minutes, if it’s a visit, it lasts for anything between 3-4 hours.

Some customers call as well as visit, some customers only call.

Now multiply this figure by a couple of hundred customers each year! So by any scale, we have already lost hundreds of productive hours.

So each customer blunts our ability to serve them by a penalty on our productivity.


Graph is for demonstration purposes only.

Reducing Productivity over increasing amounts of Phone Calls and Visits.

All the more reason to improve delivery schedule; don’t you think??


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