Customer service recommendations to increase sales for kichi-kichi hotpot bar on 61 ma may street, ha noi

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Website: http://www.docs.vn Email : lienhe@docs.vn Tel : 0918.775.368 NATIONAL ECONOMICS UNIVERSITY English for Business Department Faculty of English for Economics CAO THI THUY LIEU CUSTOMER SERVICE RECOMMENDATIONS TO INCREASE SALES FOR KICHI-KICHI HOTPOT BAR ON 61 MA MAY STREET, HA NOI Field: Marketing Code: Supervisor: Ms. PHAM THUC ANH MBA Hanoi, May, 2010 Website: http://www.docs.vn Email : lienhe@docs.vn Tel : 0918.775.368 ACKNOWLEDGEMENT The writer would like to show thanks to Ms. Duong Hoa Mai, Customer Service Executive and Ms. Le Bich Diep, Marketing Executive and other staff at Golden Gate Trade & Service Joint-Stock Company for their help during internship. The writer has the honor of expressing deep gratitude to Ms. Pham Thuc Anh who whole-heartedly gave directions. Due to limited time and ability, this report is inevitable to be present of mistakes and inappropriate aspects. So the writer is looking forward to all comments from readers to improve the writing better. Website: http://www.docs.vn Email : lienhe@docs.vn Tel : 0918.775.368 TABLE OF CONTENTS EXECUTIVE SUMMARY .......................................................................................1 INTRODUCTION .....................................................................................................4 CHAPTER 1: INTRODUTION OF THE COMPANY WITH THEIR PROBLEM.................................................................................................................5 1. Golden Gate Trade & Service JSC and Kichi-Kichi system ..............................5 2. Problem statement...............................................................................................7 3. Research methodology........................................................................................8 4. Research scope ..................................................................................................10 CHAPTER 2: THEORETICAL FRAMEWORK ...............................................11 1. Customer care or customer service definition ..................................................11 2. The importance of customer service to business ..............................................11 3. Requirements on customer service. ..................................................................16 CHAPTER 3: ANALYSIS AND FINDING..........................................................19 1. Real state of using customer service activities at Kichi-Kichi Ma May – Customer satisfaction evaluation ..........................................................................19 2. Reasons for sales decrease ................................................................................27 CHAPTER 4: RECOMMENDATIONS TO INCREASE SALES .....................31 1. Satisfying customers by suitable product, price and promotion policies .........31 2. Finding new target groups and satisfy them .....................................................32 3. Training for employees .....................................................................................33 4. Saving marketing budget by investing in selective channels ...........................34 CONCLUSION ........................................................................................................35 APPENDIX ..............................................................................................................36 1. Comment card ...................................................................................................36 2. “Eat 5 Free 1” leaflet ........................................................................................37 3. Result of the survey in January, 2010 ...............................................................38 `4. The result of survey in April. 2010 .................................................................38 4. The result of survey in April. 2010 ...................................................................39 REFERENCES ........................................................................................................40 Website: http://www.docs.vn Email : lienhe@docs.vn Tel : 0918.775.368 TABLE OF FIGURES Table: Table 1: Revenue of Kichi-Kichi in first 3 months from flotation .............................8 Table 2: Effect comparison .......................................................................................21 Table 3: “Eat 5 Free 1” effect ...................................................................................22 Table 4: Competitor analysis: Ha Noi – F1 ..............................................................27 Figure: Figure 1: Reasons for Switching to another Vendor .................................................13 Figure 2: Result of survey in week 4, January, 2010 ................................................23 Figure 3: Result of survey in week 2 and week 4, April, 2010 .................................23 Figure 4: Result of survey in week 4, January 2010 .................................................25 Figure 5: Result of survey in week 2 and week 4, April, 2010 .................................25 Figure 6: SWOT model .............................................................................................29 1 EXECUTIVE SUMMARY Kichi-Kichi is a system of hotpot bar restaurant which appeared in 2009 on Ha Noi market. Its freshness and originality make it successful. However, a unit on 61 Ma May Street (Kichi-Kichi Ma May) is an exception with its decrease in sales. This problem can be caused by many reasons but in this study on the topic “Customer service recommendations to increase sales for Kichi-Kichi hot pot bar restaurant on 61 Ma May Street, Ha Noi”, the researcher just focuses on reasons that belong to customer service section. In this study, the researcher uses primary data from customers’ opinion poll results and observation at restaurant and secondary data provided by Marketing and Accounting Department from Golden Gate Trade & Service Joint Stock Company. Primary data:  Survey: The survey is carried out daily after customers’ meal. Each customer will fill in a comment card which consists of both closed and opened questions. The answers for closed questions will provide researcher with customers’ data including their personal information such as name, gender, age, and communication information such as telephone number and e-mail address; customers’ evaluation to restaurant’s product and service. Through these answers, the writer will also know what advertising channels are most effective in marketing restaurant’s image as well as what features can attract most customers to restaurant. Besides, opened questions’ result voices the feelings and expectations of customers to restaurant at present and in the future.  Observation: The researcher studies its major competitor F1by having lunches at F1 five times including two times in off-peak hours and three times in peak hours. The quality of product and service of F1 will be exposed, so the researcher can evaluate its competitive power and then compare with Kichi-Kichi competitive ability. 2 In order to find out reasons that caused the decrease in sales at Kichi-Kichi Ma May, the researcher directly comes to restaurant and observes purchasing behavior and feelings of customers and service manner of employees. After two weeks observing in both off-peak hours and peak hours at weekdays and weekend, researcher can know the strengths that need to be upheld and weaknesses that should be improved. Secondary data: All the data about each restaurant turnover and result of promotion programs are provided by Marketing and Accounting Department from Golden Gate Trade & Service JSC. The writer will collect and analyze these data. According to the study result, the writer recognizes reasons of sales decrease:  Strong competitors Rivals of Kichi-Kichi exist on both Ha Noi and Ho Chi Minh City market. On Ha Noi market, F1 is the strongest competitor with similar products, similar concept and similar payment procedure. Direct competitors of Kichi-Kichi Ma May are restaurants and old make shift shops in the Old Quarter  Wrong place Placing in the Old Quarter, a famous tourist area, the restaurant is far from its target customers: office staff. There is no car parking around the restaurant site. This is a reason that makes it difficult for car-driving customers to come to KichiKichi Ma May.  Lack of employee With its medium size, Kichi-Kichi Ma May used to be short of human resource at peak hours. English level of all the staffs at Kichi-Kichi Ma May is too low to serve foreign travelers. After defining sources of sales decrease, the researcher recommendations to increase turnover for Kichi-Kichi Ma May: proposes 3  Strengthen competitive power: Improving product, price, and promotion policies to fit with conditions in the Old Quarter, to satisfy existing customers.  Adjust to the Old Quarter environment: Finding new target customers such as children and foreign tourists and satisfy them.  Attach special importance to employees training as well as the recruitment.  Saving marketing budget: by cutting off ineffective advertising channels such as radio along with promoting effective channels including advertising on hoarding and on internet. 4 INTRODUCTION Eating out is popular every day in every country. Consequently, restaurants mushroom in all kinds and forms. Alone in the United State, it is expected that this kind of business can reach return at about USD 577 million in 2010 1. Viet Nam is not an exception. Several years up to now, the mushroom growth of restaurants can surprise anybody. Because of profit objective, businesses try to attract customer by all means. Thus, restaurant business is now more competitive than ever. Thus, to get success in this hard industry, it asks for the combination of many factors and among them, customer service plays an important role. In the service sector, customer satisfaction is a decisive factor with the existence of a business. Golden Gate is a typical company in restaurant business, and customer service is its priority care. Thus, in this study on the topic “Customer service recommendations to increase sales for Kichi-Kichi hot pot bar restaurant on 61 Ma May street, Ha Noi” the writer will focus on analyzing and evaluating the effects of customer service activities used in Kichi-Kichi hot pot bar restaurant on 61 Ma May street from Golden Gate from flotation up to now, and from that point of view, the writer will offer some recommendations in order to improve customer service policy of the company. To do these tasks, descriptive method will be used to collect all information, and then statistic method will be used to analyze them. This essay will be divided into four main chapters: Chapter 1: Introduction of the company with their problem. Chapter 2: Theoretical framework Chapter 3: Analysis and Finding Chapter 4: Recommendation 1 Art of restaurant business, Entrepreneur www.tailieu.vn 5 CHAPTER 1: INTRODUTION OF THE COMPANY WITH THEIR PROBLEM 1. Golden Gate Trade & Service JSC and Kichi-Kichi system Golden Gate Trade & Service Joint Stock Company is the international name of a company in restaurant business which is called Cong Ty Co Phan Thuong Mai va Dich Vu Cong Vang. Situating on the 4th floor in Anh Minh Building on 36 Hoang Cau Street, Ba Dinh District, Ha Noi, Golden Gate Trade & Service JSC consists of more than 500 staffs. Golden Gate Trade & Service Joint Stock Company is a foreign invested company operating and managing luxury restaurants. They are proud of unique products, beautiful restaurants and hospitality service. Golden Gate is one of the first companies in restaurant business with its famous brand name Ashima. Ashima is a restaurant system specializing in Mushroom Hot Pot. Currently there are 7 units throughout the country centered on Ho Chi Minh and Hanoi with one unit in Haiphong. The first Ashima Restaurant opened for business on the 3rd November 2005 on 44 Phan Dinh Phung Street, Hanoi. Ashima mushroom hotpot is considered to be not only the first but also the best chain of restaurants in Vietnam specializing in mushroom hotpot. The chain now has 7 restaurants in total and can be found in all the major cities of Vietnam, such as Ho Chi Minh City, Hanoi and Haiphong. Ashima mushroom hot pot was opened with the intention of bringing to the Vietnamese people a new concept of eating, combined with specialized service. This has created a “mushroom wave” in Vietnam. In 2009, company started running a new kind of drinking and service: Kichi Kichi hot pot bar with target is fast food market segmentation. With price at about USD 6 each person and the slogan “eat as much as you can”, Kichi-Kichi receives warmly welcome from urban customers. 6 The first Kichi-Kichi restaurant was opened in Feb, 2009 and there are 22 units over country up to now, and 11 units among them are placed in Hanoi. Target customer is class B people who live in city, for example, Ho Chi Minh City, Hanoi and other potential cities in Vietnam: Danang, Cantho, Nhatrang, etc. at the age from 20 to 40. Company aims at administrative staff circle - accounts for about 20% population, mostly in HCMC and Hanoi – who has tendency to go eating outside, meeting with guests, colleagues, friends, and families at lunch and dinner time; and who is interested in a restaurant with clean environment that is good at food and service, that is convenient for their travelling, parking and the price is affordable. All the waiters and waitresses in Kichi-Kichi are young, sympathy, friendly, brisk, and good-mannered, and always ready to serve fellow dinners. Besides, the architecture of Kichi-Kichi restaurant is unique. Space is commodious, design is youthful. All inspire people about dynamic and creative youth. Along with clear and bright stone-tables, high seats make opulent feeling. The bars move with speed at twenty five dishes per minute, fast enough to not have to wait and slow enough for anyone not to miss any dish. There are red ceiling bands which are installed parallel with the moving bar. You can find a red band above any bar. The idea of red ceiling bars is based on Eastern people; especially Vietnamese people’s conception that red is the color of luck and pleasure. These red ceiling are a symbol of good luck to customers from company. Red is also preponderant color that makes impression of a space full of vitality. Another design which is remotely related to traditional conception is rectangle mirrors covering wood walls. They are all high enough for anybody’s image not to be cut. At the same time, they cause restaurant area seems to be enlarged. Specific characteristic of Kichi-Kichi is it represents an image of young, dynamic, independent, modern, and creative. Kichi-Kichi customers initiatively make their own menu. Hot pot bar makes customers feel that they hold the initiative, taking favorite food is alike taking opportunities in life. This is an eating and drinking style of youth, a style of modern Asian – always move and ceaselessly discover. Kichi-Kichi infused a fresh spirit and diversified Vietnam eating and drinking culture. 7 2. Problem statement From flotation, this chain of restaurant had good sales and received warmly welcome from urban customers because of its freshness and diversification. Quantity of Kichi-Kichi customer is about 100,000 people per month, accounts for 3.6% market size. Possibility of market penetration is still very high, as long as Kichi Kichi continues to open widely and guarantee to do what Kichi Kichi has committed to customer. The idea of a hot pot bar came from sushi bar invention in Japan and promptly spread out to Thailand, Singapore, Hong Kong, etc. And the pioneer who initiated hot pot bar trend in Viet Nam is Kichi-Kichi. It’s very easy to have a meal in KichiKichi. Customers just have to buy an opening-seat ticket, chose for themselves their favorite broth taste, and enjoy delectable food until full. Owning unique characteristics of both the traditional and the modern eating and drinking style, Kichi-Kichi brings to you not only a meal but a cultural space, a new style. This chain of restaurants provides customers with the variety of options for dinning out. Instead of cooking so many dishes to satisfy every member’s demand, people now just need to go to Kichi-Kichi hot pot bar restaurant. Here, people can choose any among hundreds of dishes on non-stop moving bar that please not only who love fast food but also traditional customers. You like pork or beef, vegetable or sea food? Whatever you want, whatever you are interested in, you will be best served in Kichi-Kichi restaurant. Especially, if you have a passion with Japanese cuisine, you will pleasure with delicious sushi and other Japan food cooked by talented cooks. Sake is a favorite wine in Kichi-Kichi restaurant. In the case you are not interested in alcohol, fizzy drinks may be your choice. There are six tastes of broth consist of Thai or Sichuan, or Korea style for whom love sea food or peppery food, Japan style, mushroom broth for people whose taste is vegetable, and Shabu broth is the perfect choice for any food. After dinning, you can order ice-cream or fruit for dessert. However, just after several months after opening, amount of customers goes down gradually. This matter happens most seriously at Kichi-Kichi Ma May. 8 Since flotation, sales of Kichi-Kichi Ma May is always much lower than other units despite ideal characteristics come from a famous tourist area. Below table shows total revenue of some restaurants in the first three months from opening. Thus, we can compare growth rate between Kichi-Kichi Ma May and others. Kichi-Kichi Revenue in first three months from flotation (VND) Vincom 2,987,328,500 Tang Bat Ho 2,631,484,000 Pham Ngoc Thach 2,599,085,060 Big C 2,505,310,500 Ma May 1,624,671,009 Source: Accounting Department Table 1: Revenue of Kichi-Kichi in first 3 months from flotation In this essay, the researcher will focus on studying reasons caused that decrease in the aspect of customer service and then give some proposals for sales increasing. 3. Research methodology Research information are collected by descriptive and observation methods. All the statistics are total up from customers commend cards which were drawled to table companions in all Kichi-Kichi restaurants on Hanoi market during 2009. These cards are dispensed to customers after their meal by waiters in each restaurant and then gathered in Marketing Department each Monday. Collecting, reckoning up, and comparing these figures will help the writer evaluate the effect of marketing strategy in customer service. Data of revenue and business cost are provided by Accounting and Marketing Departments. The researcher studied customer behavior with restaurant promotion program by observing at restaurant and supervising leaflet distribution in the road show around the Old Quarter and buildings. Primary data:  Survey: 9 The survey is carried out daily after customers’ meal. Each customer will fill in a comment card which consists of both closed and opened questions. The quantity of cards depends on the customer number each day. The answers for closed questions will provide researcher with customers’ data including their personal information such as name, gender, age, and communication information such as telephone number and e-mail address; customers’ evaluation to restaurant’s product and service. Through these answers, the writer will also know what advertising channels are most effective in marketing restaurant’s image as well as what features can attract most customers to restaurant. Besides, opened questions’ result voices the feelings and expectations of customers to restaurant at present and in the future.  Observation: The researcher studies its major competitor F1by having lunches at F1 five times including two times in off-peak hours and three times in peak hours. The quality of product and service of F1 will be exposed, so the researcher can evaluate its competitive power and then compare with Kichi-Kichi competitive ability. In order to find out reasons that caused the decrease in sales at Kichi-Kichi Ma May, the researcher directly comes to restaurant and observes purchasing behavior and feelings of customers and service manner of employees. Because of special characteristics of a busy tourist site, working and relaxing and eating hours in the Old Quarter are later than other area. Peak hours at Kichi-Kichi Ma May at lunch time is from 12h30’ to 14h, at dinner time is from 20h to 21h30’. After two weeks (from 15th March to 28th March) observing in both off-peak hours and peak hours at weekdays and weekend, researcher can know the strengths that need to be upheld and weaknesses that should be improved. Secondary data: All the data about each restaurant turnover and result of promotion program are provided by Marketing and Accounting Department from Golden Gate Trade & Service JSC. The writer will collect and analyze these data. 10 4. Research scope This research will just study customer service activities that are applied for Kichi-Kichi on 61 Ma May Street, Ha Noi because the researcher got familiar with it during internship time. 11 CHAPTER 2: THEORETICAL FRAMEWORK 1. Customer care or customer service definition Customer service is the provision of service to customers before, during, and after a purchase. According to Jamier L. Scott (2002), “Customer service is a series of activities designed to enhance the level of customer satisfaction – that is, the feeling that a product or service has met the customer expectation." 2 In opinion of this customer, customer service can be a high quality product with suitable price. However, another customer can consider it on-time delivery while other customer measures it through service attitude of staffs. In fact, a huge range of factors can contribute to customer satisfaction, but your customers - both consumers and other businesses - are likely to take into account: how well your product or service matches customer needs; the value for money you offer; the professionalism, friendliness and expertise of your employees; how well you keep your customers informed; and the after-sales service you provide. 2. The importance of customer service to business Customer service is normally an integral part of a company’s customer value proposition. Every time you have contact with your customers you have an opportunity to improve your reputation with them and increase the likelihood of further sales. From the point of view of an overview sales process engineering effort, customer service plays an important role in an organization's ability to generate income and revenue. From that perspective, customer service should be included as part of an overall approach to systematic improvement. Customer service plays an important part in keeping existing and making loyal customer, attracting potential customer, thenceforth helping company reduce cost and increase turnover.  Keeping existing customers and making loyal customers 2 www.wikipedia.com 12 Firstly, customer service is an effective tool in keeping existing and making loyal customer. Generally, customer is divided into two kinds: existing and potential customer. Your sales and profitability depends on keeping your customers happy. It is also cheaper than attracting new customers. According to the Customer Service Institute, 65% of a company's business comes from existing customers, and it costs five times as much to attract a new customer than to keep an existing one satisfied. Losing a customer is even more expensive. According to studies by the Technical Assistance Research Programs Institute, 91% of unhappy customers will never buy again from a company that has displeased them and will also voice their dissatisfaction to at least seven other people. Thus, the goal of customer service is customer satisfaction. Customer satisfaction is what customer feels subjectively and sometimes irrationally. 3 When ordering a new service or maintaining an existing service, consumers must take into account the following three key factors: the quality of the service, the price of the service, and the customer service of the service provider. The first two factors are relatively objective and usually easy to control. As shown by Figure 1, the graphical representation of a market research study done a few years ago, customer service dissatisfaction is the most important key factor when a consumer decides to change service providers. 3 www.eDigitalPhoto.com 13 Figure 1: Reasons for Switching to another Vendor (www.iec.org) Retaining existing customers mean making them keep buying company product or service. It means they are less likely to go to your competitors in the increasingly competitive markets where customers have more choices than ever. As satisfied customers, they will recommend you to other, resulting in an increase in new business. It is said that it costs up to ten times as much to win a customer than to keep an existing one. When being satisfied, they are less likely to tell other people of bad experiences. Customers experiencing poor service are likely to tell up to twenty people about their experience, which is not good advertisement for your business. This may deter other from even trying you out, and so you will not get a chance to impress them, even with the best or most innovative products and services.4 Businesses can improve profitability by focusing their attention on their customer that has the highest potential lifetime value. In their book Rules to Break and Laws to Follow (2008), Don Peppers and Martha Rogers, Ph.D. write that “customers have memories. They will remember you, whether you remember them or not." Further, "customer trust can be destroyed at once by a major service problem, or it can be undermined one day at a time, with a thousand small demonstrations of incompetence”. 4 2009, The Chartered Institute of Marketing, 10 Minutes Guide: Customer Service Program 14 All the customers want to receive the highest attention from supplier, want their supplier considers their demand as the top priority. Only the fastest and most effective service can satisfy customers. Once companies provide an excellent customer service, they can retain their customer and make them loyal. These loyal customers help company retain a fixed income and even make more profit because when customers are pleasured, they will buy not only more but more regular. Existing customer relationships are opportunities to increase sales because your customers will already have a degree of trust in your recommendations. Employees who deal with customers' orders should be fully aware of current offers and keep customers informed. Sometimes brochures and other marketing materials are the best way of getting word out about a new customer incentive. Don't forget though that your customers' view of the overall service you provide will influence their loyalty much more than short-term rewards will  Attracting new customers Loyal customers are so important to every business. However, to exist and develop in this competitive environment market, business must try its best to win new customers. The first step in attracting new customers in any economic climate is pleasing your regulars because the word-of-mouth buzz you gain from them will be a huge boon in attracting new business. Satisfactory customers will tell others about excellent service you provide that is more effective and trustworthy than anything you advertise or broadcast on public media. Next, you could reach your target groups by some direct means such as sales promotion, meeting, and free consultancy, etc. have function is to provide new customers with more information about company as well as product and service, along with gain sympathy and trust from potentials. To begin with, you have to let people know you exist – advertise yourself. If people don’t know where you are and what you do, they can’t buy from you and you will never make enough money to stay open. Advertising greatly increases your chances of success if you know who your customer is. Then you can tell them what they want to hear. However, good 15 advertising techniques are useless without an effective message. An effective message gives people reasons to spend their money with your business. There are a number of free or nearly free ways to advertise your business or service. You could rely on word of mouth, that does not cost anything, but it might take a long time before word spreads. The second inexpensive method would be flyers. This method can be very effective for certain business, but the effect does not last long. Chances are the person will take one look and throw away the flyer. The third relatively inexpensive advertising method is newspaper advertisements. You could place a small ad that runs for a few weeks in a few local newspapers. This will give you great exposure to your selling area. However, the ads do not run forever unless you want to keep paying. An effective way to advertise that has a relatively low initial cost is with sales promotion. Sales promotion covers a wide variety of short-term incentive tools such as coupons, premiums, contents, buying allowances that are designed to stimulate consumers, the trade, and the company’s own sales force. Sales-promotion spending calls for setting sales-promotion objectives, selecting sales-promotion tools, developing, presenting, and implementing the sales-promotion programs, and evaluating the results.5 In the sales promotion strategy, promotion products are a difficult question to many businesses. What are promotional products? Promotional products are items that proudly display your company's name and information. Sure, the initial cost is more than using flyers or newspaper ads, but, unlike the other methods, the promotional product makes a lasting impression. Every time customers use your promotion items, they will see and think about your company’s name. Then when they are ready to make a purchase, your company's name is at the top of their mind. 5 Philip Kotler, Principle Marketing 16 With the right promotional product, a small business owner will see a great return on their investment. 6  Reducing cost and increasing sales Good customer service can help company reduce cost. It is true. When customers aren't happy with your business they will complain. They, however, usually won't complain to you - instead, they'll probably complain to just about everyone else they know and take their business to your competition next time. As a result, you have to find solution to solve the trouble, and that task costs your budget. On the other hand, as mentioning above, satisfactory customers easily become loyal customers, and so you will save budget for attracting new users. Customer care is a tool increases your sales promptly. Your existing customers are among the most important assets of your business - they have already chosen you instead of your competitors. Keeping their custom costs far less than attracting new business, so it's worth taking steps to make sure that they're satisfied with the service they receive. Existing customer relationships are opportunities to increase sales because your customers will already have a degree of trust in your recommendations. Satisfied customers will contribute to your business for years, through their purchases and through recommendations and referrals of your business. 3. Requirements on customer service. Good customer service is all about bringing customers back. And about sending them away happy, happy enough to pass positive feedback about your business along to others, who may then try the product or service you offer for themselves and in their turn become repeat customers. If you’re a good salesperson, you can sell anything to anyone once. But it will be your approach to customer service that determines whether or not you’ll ever be 6 2009, http://EzineArticles.com/?expert=Angela_Marino
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