Strategy for customer expansion

Abstract

This study offers a description of Schenker Dedicated Services AB (SDS) and their current problem with identifying their most promising target markets and potential customers at these markets. The purpose of the thesis is to explore what possibilities SDS have to reach their objective to grow in terms of new customers, sales, profit and position at the market. The goal with the thesis is to generate a solution for SDS that lowers the costs and the long lead-time, which today is a perceived problem in the process of recruiting new customers. The recruiting time and costs were the underlying reasons that initiated this thesis. In this thesis general guidelines are presented to the management at SDS concerning how they should improve their customer recruiting processes. To reach the conclusions formed as guidelines several internal and external interviews were conducted. These interviews focused on exploring buying behavior and underlying factors that are of high importance for companies with a possible need for a dedicated transport solution. As a result of the conducted interviews, three market channels were identified, namely Tender Management, External Consultants and Account Managers at Schenker, and their suitability was examined. The examination of the market channels focused on `hard values' which represent measurable values concerning goods value, transport distance etc. The more abstract factors referred to as `soft values', such as corporate comparability and strategic willingness to form partnerships are more difficult to measure. Besides the market channels a selection process is presented. This selection process is based on several factors, which SDS should recognize before considering initiating any business negotiations. A selection process that identifies if the adequate hard values are fulfilled should be the first step in the recruiting process of any new customer for SDS. According to the authors SDS should not focus too much on the `hard values' but instead pay more attention to the `soft values' requirements that ought to be fulfilled for successful partnerships in the future. This could be summarized as if a potential customer expresses the right intention from the right strategic level to cooperate, the hard values could be seen as the second most important factor as long as they fit into the framework set up by SDS management.