In Managing Customer Relationships, the Three Primary Ways Profits Can

question 116

Multiple Choice

In managing customer relationships, the three primary ways profits can be obtained are by

• A)acquiring new customers, enhancing the profitability of new customers, and shortening the duration of relationships with existing customers.
• B)enhancing the profitability of existing customers, eliminating customers who provide smaller profits, and finding new customers.
• C)extending the length of relationships with customers, cutting organizational costs, and enhancing the profitability of new customers.
• D)eliminating long-term customers who have decreased purchases, finding new customers, and increasing sales to existing customers.
• E)enhancing the profitability of existing customers, extending the duration of relationships with customers, and obtaining new customers.

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Definitions:

Spontaneous Financing

Financing that arises naturally from the normal operation of a business, such as trade credit from suppliers.

Seasonal Working Capital

Additional funds a business may need at certain times of the year to manage increased operational activities.

Clean-Up Requirements

Environmental or legal directives that mandate the remediation of pollution or contaminants from a site.

Compensating Balance

A minimum account balance that a borrower is required to maintain with a lender, which can reduce the effective amount of loan available to the borrower.