It's the age old question: which came first, the chicken or the egg--only for writers it's character or plot. Which comes first? Here's my take on the question. Feel free to disagree.
Characters are important. It's wrong to say you can't have a story without characters. What you should say is: you can't have a good story without strong characters. Most readers will take accept some little inconsistencies in your plot, forgive flights of fancy, if they relate to your characters.
On the flip side, plot is important. You don't have a story without a plot. Without a plot, your characters are just...there. Without characters, plot is irrelevant. How's that for circular thinking?
For me, characters come first because they give me the most trouble. The plot "happens" as I write, but I sweat over characters. I was never good at chemistry and creating a character is a lot like mixing a formula.
The trick is to create a picture in your reader's mind and keep it consistent. Without simply listing a bunch of physical characteristics. I've seen it done, but it isn't pretty. For the most part, we try to drop hints here and there throughout the narrative until the reader builds his/her own mental image – which may or may not bear any resemblance to the writer's.
What amazes me, three years after typing "Chapter 1", is how my protagonist has developed--largely thanks to the comments of test readers and one stupendous editor (you know who you are, Mary). This editor told me there was really only one problem with my novel: the protagonist had no character. She was a follower, not a leader. She would not resonate with readers. No soon had the editor uttered those words than I realized she was right. I went back and wrote in a backbone. Now she has a strong will; a polite, but forceful manner; and no fear of leaping before looking. She's also sassy, red headed, and pissed off at the entire male sex -- temporarily.