For most of history, customer service in the manufacturing sector meant company representatives met with buyers for the distributors or retailers who took their products to market. Customer service consisted of buying lunch or drinks and negotiating terms.
No more. According to a study by Salesforce, most consumers (64%) now regularly buy directly from manufacturers. Whether the goods are sold direct to the consumer (DTC) or via a retailer, service and support calls are virtually all routed back to the manufacturer.
Now, customer service means fielding incoming calls from end-users regarding irregular fabrication, missing parts for assembly, or clarifying instructions for use. On the plus side, this direct customer contact is an opportunity to foster brand loyalty for the manufacturer… provided the customer’s service and support experience is a positive one.
A New World on the Margins for Manufacturing
Assuming responsibility for customer satisfaction opens a whole new cost center for manufacturers. Even if a manufacturer has done all they can in quality control to minimize defects, damage during shipping, and ease of assembly and use, things can go wrong. And each call for customer service is a bite out of the margin on that sale.
Beyond having to deal with customers’ immediate issues with their products, manufacturers need to deal with customers’ expectations. The most basic of these is that the manufacturer stands behind their product and will satisfy the customer, even if that means a full replacement, which is a painfully expensive proposition.
The next expectation is that the manufacturer’s representative knows their product and can remediate most issues. That means the manufacturer must adequately train customer service representatives, provide them with a database of detailed product information in a way that is easy to search and understand, and establish an escalation path if the frontline resources are insufficient. That’s less painful and less expensive, but it might be worth it.
As noted above, positive direct customer contact can foster brand loyalty, lowering the cost of future sales. And that contact can represent another source of value: data.
Careful collection of customer interaction records can reveal further opportunities for savings in cost inputs like materials, contracted subassemblies, packaging, and packing and shipping processes. Customer surveys can point to unfulfilled customer wants or needs that inform product development. And customer contact data can fuel future direct sales.
What Manufacturers Need to Deliver Successful Customer Service
While good customer service may come at a slightly higher cost than poor service, it’s a worthwhile investment. The potential for retaining satisfied customers and avoiding the higher costs of cancellations and lost sales makes excellent service not only more valuable but also more cost-effective in the long run.
The Nuts and Bolts of Customer Service
Customer support operations incur recurring costs of personnel and database maintenance for good customer contact and continuous service improvements and marketing. Then there are the sunk costs of contact center technology and training.
But these are rarely integral to most manufacturers’ core business. For this reason, manufacturing customer service tends to be outsourced. The other advantage to such an arrangement is the costs of service and support are consolidated into a few line items, which simplifies administration.
The only other way to further control costs is to change vendors: the firms that supply the personnel and infrastructure and administer the necessary training. However, a pure customer/vendor relationship with your support provider can impact the desired brand-building and relationship with end-users.
Balancing Cost and Quality
While technology can boost support staff performance – for both productivity and the quality of the customer experience – that quality is ultimately determined by everyone involved in delivering it; not just the people who answer the phones or conduct the chats, but the people who manage that frontline personnel, and the executives who establish the company’s business values.
This might seem abstract. But anyone running a business knows the difference that company culture can make in a company’s performance. When companies look to outsource their customer support operations, they frequently consider countries other than their own with different cultures and, frankly, lower wages. And that can affect the quality.
One way to strike the ideal balance between cost and quality – instead of “offshoring” customer service – is to “nearshore” it. That is: to contract with companies closer to home that still offer lower personnel costs but also reflect a more familiar culture. A similar work culture can foster better natural connections with inbound customers.
What To Consider When Outsourcing Customer Support
U.S. companies looking to outsource customer service and support must be sure that solution is best for their needs. Consider the following factors:
Language Proficiency: Many offshore destinations are selected for the prevalence of English. But prevalence is different from proficiency. Operations in countries where English is common may not invest the time and effort to ensure their agents are truly skilled in the language.
Educational Standards: Countries with low wages often have corresponding educational systems. The people can be just as bright, but they may not have the breadth of knowledge to communicate with more well-educated customers. It becomes incumbent on the support contractor to provide additional training.
Soft Skills: Greater cultural alignment can also foster better personal interactions between agents and customers, including problem-solving, empathy, patience, and active listening.
Compliance with Labor Standards: Customer support operations that compete strictly on price can sometimes cut corners on working conditions. This can influence agents’ attitudes and even start to reflect poorly on a manufacturer’s brand.
Supplemental Technologies: Contact center technologies tend to be standard across geographies. But data capture capabilities are where value gets added. Be certain a provider has the necessary tools to get the data you need and deliver it in a manner that facilitates its effective utilization.
Robust Onboarding: The best contact center operation isn’t necessarily the best fit for you until their people are well-versed in your company and its products, and they consistently reflect your brand’s approach to customer care.
A Spirit of Partnership: If another company is going to represent yours to your customers, they need to reflect that commitment in their interactions with you. Some companies take responsibility and actively manage that relationship, while others just take orders.
In all of these categories, nearshoring may prove a better source of the caliber of service you need and a better operational fit for your company.
Unlock Customer Service Success with Nearshore Talent
As manufacturers struggle to maintain profitability while assuming more responsibilities for customer service and support, they’re discovering better ways to reduce costs, maintain or improve service levels, and turn those interactions into greater business value. Nearshoring customer contact operations can satisfy all those needs.
Solvo specializes in providing high-quality nearshore talent solutions for businesses across various industries, including manufacturing. We can assist you with the entire recruitment and onboarding process, from identifying and sourcing qualified candidates to managing their employment and ensuring compliance with all relevant regulations.
To learn more and see what Solvo can do for your business, Contact Us – Solvo Global
