The IT advantage

17th of September 2012
The IT advantage

In business, reputations flourish or flounder on the efficiency of the technology in place. Hartley Milner looks at how distributors of janitorial supplies are turning to the IT industry in their quest to improve customer service and enhance their profile.

Distribution today is about so much more than simply the delivery of goods. The supplier who is prepared to go the extra mile for their customers in other ways is the one most likely to keep the order books looking healthy.

Especially in these difficult times, customer loyalty can never be taken for granted and distributors are increasingly appreciating the role of technology in ensuring they keep their clients on board.

Sophisticated IT systems and software are being developed that not only improve the distribution process but also empower suppliers to help their customers make smarter buying decisions and greener product choices.

“Nowadays it’s all about customer service and very, very low profit margins,” said Mark Hughes, senior sales director of Epicor, a global provider of business software to janitorial suppliers and other markets. “In this age of multiple channels to market, it is so much easier for people to buy from different sources. So to keep their customers and win new ones, distributors need to use technology to continually offer a better service and gain a competitive advantage in the market.”

Hughes stressed the need for software providers to be open to new ideas from their customers. “For example, recently we have had a lot of distributors wanting to have eBay stores, so they require an interaction from their ERP (enterprise resource planning) system into eBay to enable them to lift items directly,” he explained.

“They can then maintain their inventory levels within their ERP system, having that shown on their online trading platform. This is of benefit to many smaller distributors who may simply not be big enough to have and maintain their own websites or web stores.

“Technology is addressing many other key areas, such as delivery confirmation, rebate tracking and traceability – being able to track products at serial number level in the case of cleaning equipment through to finding batch items such as cleaning chemicals. Suppliers also need the ability to distribute products in multiple units, assess what products they have in stock and pack sizes etc.

“What is relatively new with ERP software is the ability to have multiple stock locations and centralised buying, enabling the purchasing of the minimum amount of stock in terms of cost while still meeting the customer’s needs.

“There is a lot of clever stuff around data analysis – to say how much stock a distributor should be holding and where but now also having it across more branches so that a distributor might say ‘I don’t have this product here, but I might have it at another branch’. It’s all about using very sophisticated methods for projecting the stock levels necessary to have 90, 95 or 99 per cent customer satisfaction.

“It’s interesting, the way data analysis is going; taking all the valuable information people are collecting now and building data bases bringing in external feeds, such as interest rate trends. Suppliers are getting a better understanding of buying patterns, behaviours and the effect of external factors.”

Strides are also being made in the development of automated voice picking technology. This uses speech recognition and speech synthesis to allow workers to communicate with warehouse management systems. Massive improvements in order picking accuracy are claimed (up to 99.9 per cent), along with increased productivity and cost savings.

And cloud computing is gaining converts across the business world as security concerns are put to rest. Hughes said: “When it comes down to financials, customer lists and CRM (customer relationship management) people are reluctant to let them go into the cloud because they are at the core of their business. But I think in three to five years people will become more familiar with the cloud and the successful vendors will be those with other options.

“Our distribution software can be implemented on site, remotely or genuinely into the cloud,” said Hughes. “What that does is give smaller distributors the opportunity to run a sophisticated solution that is going to empower them to make better business decisions without having to invest in costly hardware and large up-front costs. People want their software to do more and that does require bigger and bigger boxes and more and more processors, so it makes sense to move to an environment where you just pay for the processing power you use.”

Heavy investment

Not yet won round by assurances about cloud security is Mandie Kemp who runs Futures Supplies and Support Services, a distributor of washroom, cleaning and janitorial products. She has instead invested heavily in upgrading and streamlining the technology at her company’s south London premises.

“We started up in 1995 before website and other technology was generally available and, as we know, it turned out to be a key development in driving the industry forward,” she said. “We have always tried to be at the forefront of technology and were among the first to offer an online shopping facility. Having such robust systems in place have certainly helped us grow our business.

“Our software offers a fully integrated suite of multi-user application software designed to enable us to support and fulfil the specific individual requirements of our customers. The software encompasses facilities for call management, sales order processing, stock control, invoicing, sales purchasing and van routing. And it provides comprehensive management control, including detailed sales, stock and purchase reporting.”

Futures Supplies’ website order processing system runs at a hosted data centre linked to the company’s main office server via its own dedicated broadband line. This enables the smooth transfer of customer orders directly into the main order processing system round the clock. Orders are then allocated to a delivery route, giving the customer an accurate date for their arrival, enabling Futures Supplies to manage deliveries more efficiently, provide more accurate delivery dates and be more efficient with delivery costs.

The company’s delivery fleet is equipped with a Telematics GPRS tracking system that has led to improvements in routing and fuel consumption, and keeps customers informed about the location of their order during transit.

The Futures Supplies website, meanwhile, has recently undergone a major upgrade. The site already generates 70 per cent of the company’s business and online traffic and sales order volumes are increasing. And customers expect faster access to back office support and information, including their sales order history, proof of delivery and invoices and statements.

One facet of this is a fully integrated budget control tool that is widely used by the company’s contract cleaning customers, producing considerable benefits and efficiencies for them in terms of back office time, cost control and savings on management time. To set up, it simply requires:

• An agreed ‘materials’ and ‘rechargeable’ list

• The customer’s budget data uploaded from a spreadsheet they provide

• A unique user name and password for the person nominated to place orders and for the customer administrator.

“Providing a clear definition between orders for materials and rechargeable, the system ensures that our client never forgets to invoice onwards for the rechargeables,” explained Kemp.

“The customer administrator has access 24/7 to download and monitor monthly spend, summary reports, products ordered by site and allow or disallow budget-busting orders at the click of a button. A copy of the order is generated as confirmation to both the person who placed the order and the customer administrator.”

As part of a quest to build long-term partnerships, Futures Supplies has also launched a number of partner website janitorial shops in a collaboration that aims to help its customers grow their business. The shop is accessed via a link on the partner’s website which enables their own customers to purchase an agreed selection of products. Futures Supplies takes care of the processing and delivery.

An unapologetic tree-hugger, Mandie Kemp is helping her clients make product choices with the environment in mind. Sustainable products are signalled on the Futures Supplies website by a green traffic light, indicating they have little or low environmental impact, are biodegradable, include recycled content or carry an authenticated ‘eco’ or green logo or label. Technology is also helping with the reduction of paperwork.

Integrated website

The Futures Supplies website dates from 2005 when Sean Heraghty of e-Business Systems brought in a proven e-commerce system that he then tailored to the company’s and its customers’ specific needs. A key requirement was for the website to be integrated with the system serving the back office, which processes orders and updates product stock and customer information.

“With an integrated website, orders taken on the website are automatically transferred to the back office system for processing,” Heraghty explained. “And on the other side, any updates made in the back office to products, customer details and prices are automatically transferred to the website. Other things like safety data sheets and product pictures can be placed in a folder which is picked up by the website.

“But you cannot buy packages that do all this – someone has to actually integrate the website with the other systems so that they operate seamlessly together. With a properly integrated set of systems, there should be very little additional administrative effort to keep the website up to date.”

With businesses so dependent on new-age technology, operational hiccups can prove costly. So Heraghty implemented a failsafe system that runs on a separate server and monitors the website every 15 minutes. “If the website doesn’t respond within seconds, it is then restarted automatically. So even if there has been a technical failure, Futures Supplies’ customers will rarely see any downtime on the website,” he said.

Heraghty added that flexibility was a key feature of the website, enabling it to respond to Futures Supplies’ evolving needs while providing the company’s clients with facilities they may not have themselves, such as the order budget control system. “This system can save contract cleaners a great deal of admin effort in controlling the costs of their cleaning contracts. So the Futures Supplies website is offering a lot of added value to its customers.”

Read the ECJ Distributor Focus supplement here


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