Describing the Customer’s Costs


The Final customer is either an end-user or an installer. Consumers make up the bulk of the end-users, though organizations such as companies, government entities, and other organizations, can also be end-users. The installer type of Final customer includes both contractors, who serve the ultimate end-user, as well as original equipment manufacturers, who buy products to install in their own Final product.

The Final customers take four steps in connection with the product:
Maintain and
Dispose. Each of these four steps cause the Final customer to incur additional steps and costs in connection with the product. Some of these additional Acquire costs include:

Acquire Steps: Acquire steps include all activities the customer completes preceding the use or the consumption of the product. These steps include the customer's efforts needed for evaluation and acquisition of the product.

  1. Determine need exists: A customer must understand that he has a need for the product.

  2. Find and evaluate potential suppliers: The customer must find potential suppliers and evaluate each of them.

  3. Find and evaluate products: The customer must identify products and services that would fill his needs and then make comparisons among them to choose his best option.

  4. Determine product inventory needs: A customer must determine an appropriate level of inventory for the product.

  5. Order product: The customer must understand his current inventory position and order appropriate replenishment for that inventory.

  6. Take delivery of product: The customer must receive new product being delivered to him.

  7. Make payment for product: The customer must pay his supplier for the product.

  8. Test incoming products: The customer must assure himself that the product performs as promised.

  9. Return product for credit: The customer must prepare and return the product that is unsatisfactory.

  10. Install product: The customer must install the product in his environment.

  11. Make product compatible with complementary products: The customer must make the product work with other products used concurrently or sequentially.

  12. Learn how to use product: The customer must learn how to use the product appropriately.

  13. Add product to physical inventory: The customer must add the product to his physical inventory.

  14. Remove preceding product: Where the product replace a previous product, the customer must remove and dispose of the preceding product.

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