CUSTOMER MARKETING

Marketing Marketing is based on the importance of customers to a business and has two important principles: 1. All company policies and activities should be directed toward satisfying customer needs. 2. Profitable sales volume is more important than maximum sales volume.

... to best use these principles, a small business should: Determine the needs of their customers through market research Determine the needs of their customers through market research Analyse their competitive advantages to develop market strategy Analyse their competitive advantages to develop market strategy Select specific markets by target marketing Select specific markets by target marketing Determine how to satisfy customer needs by identifying a market mix (price, place, product, promotion) Determine how to satisfy customer needs by identifying a market mix (price, place, product, promotion)

Market research Successful marketing requires timely and relevant market information. Successful marketing requires timely and relevant market information. research program (questionnaires)  uncover research program (questionnaires)  uncover dissatisfaction or possible new products or services dissatisfaction or possible new products or services Market research will also identify trends that affect sales and profitability. Population shifts, legal developments, and the local economic situation should be monitored to quickly identify problems and opportunities. It is also important to keep up with competitors' market strategies. Market research will also identify trends that affect sales and profitability. Population shifts, legal developments, and the local economic situation should be monitored to quickly identify problems and opportunities. It is also important to keep up with competitors' market strategies.

Managing the Marketing Mix – 4 „P“ Every marketing program contains four key components : Products and Services - product strategies may include concentrating on a narrow product line, developing a highly specialized product or service, or providing a product- service package containing unusually high- quality service. Products and Services - product strategies may include concentrating on a narrow product line, developing a highly specialized product or service, or providing a product- service package containing unusually high- quality service.

Promotion - Promotion strategies include advertising and direct customer interaction. Good salesmanship is essential for small businesses because of they have limited ability to spend on advertising. Promotion - Promotion strategies include advertising and direct customer interaction. Good salesmanship is essential for small businesses because of they have limited ability to spend on advertising. Managing the Marketing Mix – 4 „P“

Distribution (Place) - The manufacturer and wholesaler must decide how to distribute their products. Distribution (Place) - The manufacturer and wholesaler must decide how to distribute their products. Working through established distributors or manufacturers' agents generally is easiest for small manufacturers.

Price - The right price is crucial for maximizing total revenue. Generally, higher prices mean lower volume and vice-versa; however, small businesses can often command higher prices because of their personalized service. Price - The right price is crucial for maximizing total revenue. Generally, higher prices mean lower volume and vice-versa; however, small businesses can often command higher prices because of their personalized service. Managing the Marketing Mix – 4 „P“

What is management - Process of coordinating of resources to meet an objective - Planning, organising, directing and controlling

Managerial Roles

Management Skills

Technical skill involves process or technique knowledge and proficiency. Managers use the processes, techniques and tools of a specific area. Human skill involves the ability to interact effectively with people. Managers interact and cooperate with employees. Conceptual skill involves the formulation of ideas.

SWOT analysis - Strengths - Weaknesses - Opportunities - Threats

For example: ŠKODA Auto, a. s. - Strengths (the only car producer in the CR, monopoly position, tradition, …) - Weaknesses (impossibility of collaboration with Czech car company, „unknown“ car mark in the world, …) - Opportunities (cooperation with German car factories, price competitiveness: low-cost labour force, …) - Threats (european and world competitiveness, failures of subsuppliers, …)

SWOT analysis ??????? Strengths (…….) Weaknesses (…….) Opportunities (…….) Threats (…….)

FINANCIAL MANAGEMENT

Financing of the enterprise Each activity in the enterprise has two sides: material (tangible, assets) – flow of machines, raw material, material, finished products, which are possible to divide on activities of supplying etc. cash (financial) – flow of income and expenses. Each activity has to be ensure by so financial means (resources). Tangible and financial flows has to be in concordance.

Forms of financing 1) According to the origin of capital: a) internal financing, b) external financing. 2) According to the period of using : a) long-term financing, b) short-term financing. 3) According to the regularity of financing: a) usual financing, b) unusual financing.

Balance Sheet - what the company owns and owes Income Statement - how good the company is at making money Cash Flow Statement - how they're paying for their operations and their future growth

AssetsLiabilities Current assets Current liabilities Cash and cash equivalents Accounts Payable Inventories - net Sales Taxes Payable Other current assets Payroll Taxes Payable Accrued Wages Payable Short-Term Notes Payable Short-Term Bank Loan Payable Fixed assets Long-Term Liabilities Fixtures and equipment Long-Term Notes Payable Mortgage Payable Other assets Trademarks, etc. Total assets Total Liabilities

Structure of assets Assets in the balance sheet are divided into three groups: Current – cash, bank accounts, inventories (raw materials, goods in process) Fixed – property, plant, equipment (permanent investments) Intangible – patents on a process or invention, copyrights, trademark, goodwill

Liabilities - can be characterized as the debt a business owes, represent claims against the assets long term, current Current liabilities – accounts payble, notes payable, accrued expenses Long–term liabilities – debts that fall due a year or more after the date of the balance sheet, leases, mortgages

Property and capital structure of the firm Each business needs tangible and intangible resources: buildings, machines, material, means of transport, etc., which are together called „properties - equity“ and each item „assets“. To get these properties, each company need some sources - so called „capital“ (internal or external). Capital resources are called liabilities.

Process organization of production A/ Pre-production stage - inventory purchase, raw materials needed for the purchase order all the documentation is prepared (technical, manufacturing and also for product) product development purchase of : 1/ material purchase of : 1/ material 2/ components, parts 2/ components, parts

Process organization of production B/ Production stage - 3 phases: 1/ using of raw materials to make a semi- finished product (size and shape design) 1/ using of raw materials to make a semi- finished product (size and shape design) 2/ making the final product (final parts, assembly) 2/ making the final product (final parts, assembly) 3/ complete phase (final product according to customer wishes, surface design, control, testing, and wrapping) 3/ complete phase (final product according to customer wishes, surface design, control, testing, and wrapping) C/ After- production stage - completion of products into order, goods despatch

OPERATION STRATEGY - company competitiveness refers to its relative position in comparison to other firms in the local or global marketplace It includes: capacity requirements capacity requirements facilities facilities technology technology vertical integration vertical integration workforce workforce quality quality production planning/materials control production planning/materials control organization organization

Just-in-time production - Just-In-Time is a Japanese manufacturing management method developed in 1970s - producing only necessary units in a necessary quantity at a necessary time - it helps to completely eliminate unnecessary inventories in the factory New methods of production management:

Kanban system - i t is the way to manage the Just-in-time production method - it is an information system to harmoniously control the production quantities in every process - it gives an information what kind of units and how many units are needed (it is written on a tag-like card called „Kanban“) New methods of production management:

Recapitulation

Basic terms  Business - all the work involved in providing people with goods and services for a profit Profit - is the money left over from all sums received from sales after expenses, which have been deducted Enterprise - an independent subject, founded usually by entrepreneur on purpose to achieve some profit, which is usually the main objective of business

 Entrepreneur Basic terms - person who starts or takes over a business and takes the financial and personal risks involved in keeping it going - one who decides what to produce, how to produce it and how to sell the output Manager - person, who holds the basic managerial functions as planning, organizing, recruitment and leading of people Leader - person, who is able to gain and affect people so they will make an effort to achieve firm goals

Basic terms  Organizational structure - process of arranging work, dividing responsibilities, coordinating  Economics – a science concerned with law governing the economic life of society - to meet human wants and needs with limited sources - how, what and for whom

Basic terms Economy Economy - complex of activities and subjects (firms, companies, state, individuals) concerned with the production, distribution, exchange and consumption of goods within a certain area Supply – the goods being sold Demand – the interest of the buyers to purchase the commodities offered Market price – a figure determined by the relation between the supply and the demand Equilibrium – point of intersection between supply and demand Competition – creates an inseparable conditions for the existence of any market

Basic terms  Balance sheet - it is a financial picture of the enterprise at the close of business on a particular date (end of a month, a quarter, a year)  Long-term equity - in the balance sheet it is called „ fixed assets“. It is the equity, which is used in the firm longer than 1 year

Basic terms Rate of return Rate of return - is simply how much you earn from an investment over time. Rate of return includes interest payments or dividend payments as well as the difference between an investment’s starting price and its ending price. Rates of return are typically calculated as a percentage, which is the growth in value of an investment over a time period compared to its starting value. An investment does not need to be purchased or sold to make this calculation. The market price is used to measure a rate of return.

Basic terms Inventory Inventory - a detailed list of all the items in stock - all goods and materials available for sale (in the case of wholesalers, retailers, and distributors) or raw materials and supplies, work in process, and finished goods (in the case of manufacturers) - listed in the current assets section on the statement of financial position

Basic terms Income statement Income statement - summarizes a company's revenues and expenses for a fiscal year. It is one of four financial statements presented in the annual report, reflecting a company's operating performance by identifying the sources of income and the various costs and expenses, gains and losses, which results in a final net income figure Cash flow statement - financial records of receipts and expenditures during a specific period

Basic terms Liabilities Liabilities - financial obligations, debts, claims or potential losses. For example, a company's debts to a lender, a supplier of goods and services, a tax authority and others. Listed on the consolidated balance sheets Assets - any item of economic value owned by an individual or corporation, especially that which could be converted to cash. Examples are cash, securities, accounts receivable, inventory, office equipment, a house, a car and other property Liquidity (payback period) - period of transformation of investment back to cash form

… this is the end of our Preliminary Course Business Administration! … see you on 25th October :o)