by Ronald Manalastas

Created on: January 22, 2011

The central purpose of business is not to generate profit but to find, acquire, and retain customers. Without the customer, there is no rationale for the business. And if customers are already on board, before the owners can even talk of profit, the business must first satisfy real needs and wants in the way that delights the customers to the point of loyalty and repetitive purchase.

Customer satisfaction is paramount whatever is the product or service, whether it is for the protection, preservation, or enhancement of life, property, or environment. It is the core value that precedes all other motives for starting and running a business. It must be noted that a business may be set up for alternative reasons, which in many instances are even more compelling than profit, and these motivations include:

1. To be an industry leader

Customer satisfaction is central in this motive and it is the business accelerator. Here, the business has a compelling value (e.g. technology / cost leadership) that can satisfy some existing need in a unique way and catapult the business to a market leader’s position. When the business becomes the market leader, perks and premiums, including profits, are realized much easier. It is not uncommon to anticipate financial losses in the first two years of operations for this kind of business motive, but the payoff from being an industry leader is unquestionably substantial.

2. To capitalize on time-to-market advantage

In many instances, analysis, plans, registration, organization, and mobilization of businesses are accelerated to beat some time-to-market schedules. The crucial business decision point is not profit but the advantage of being ahead of competition in the market.

In the execution of this motive, the venture is at times propagated even if no windfall profits can be immediately expected from the business. What is important is the timely product or service launch in order to create market awareness, build customer communities, and influence the habitual use of the product or service.

3. To correct a supply-demand gap

In several occasions, new businesses are put up from the ground because of extended supply shortfalls that create a business case for the entry of new suppliers. The supply and demand imbalance connotes a gap that has a fleeting character since preference can revert to traditional suppliers once the adverse situation has improved. The financials in this kind of venture do not guarantee sustainable profits because

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