Why you should use data analysis in business
In most cases, the business will not realize the value which data analysis can add to their businesses. Whilst this has not been fully appreciated, the data which businesses generate and collect on a day to day basis provide opportunities for improving their service and hence business performance. It is a pity that despite having data collected on a daily basis in day to day operations, many a business do not even make the effort to utilize the data. Worse still, some do not even collect data or keep records of their operations. T start with let me give an example of how a business can utilize data to improve its performance. Of course, this is not a matter of immediate returns but in business, we need to have a long-term view.
Let us consider company X which is in the business of supplying a seasonal item, raincoats. In 2020 they received 70 requests for quotations of which they managed to secure 15 sales. It is not important whether you consider that a good return or not but let us look ahead. If they have kept a record of all the enquiries, including contact persons, email addresses and phone numbers that means once they have their supplies ready for the next season in 2021, they have a database of 70 customers to contact directly rather than having to wait for enquiries. Moreover, they have should have done some analysis on why they did not get the order in 2020, and will now make the necessary adjustments. Maybe 20 potential clients were lost because they didn’t have PRAZ. Maybe another 10 were lost because they did not have a NOSTRO account. Maybe some were not comfortable with paying 75% as they requested. Or for some, they just did not have the right colour. An analysis of customer feedback from 2020 can help them to make the necessary adjustments and get the order this time. Knowing why they did not get the order last time will improve their chances of getting it this time. With an analysis of how they performed in 2020 and the factors which influenced performance, they can definitely get more business in 2021. For the new season, they can contact customers, making sure to inform them they have resolved the concerns that were a deal-breaker last time. Like “We now have raincoats in stock and we have now registered for PRAZ.” Of course, they will also benefit by contacting the customers who bought from them last time even before they start looking around. Some will give you the order straight away on the strength of the good service in the last year. The result should be an increase in sales from last year. That approach, repeated year after year will see the business grow.
The issue of seasonal products does not only apply to products that are seasonal in nature. Sometimes it is your clients’ use of a product that is seasonal and that same approach of analyzing customer engagements is needed.
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