Team meeting to learn more about OPAL from experts.


Increasing Orders Processed and Revenue

Increasing Orders Processed and Revenue

The biggest advantage to being a valued supplier to a retailer is the opportunity to get even more orders through that sales channel.  Having more orders means more sales and more revenue for your business.

This is what every business owner strives for, but in the e-commerce world where it’s no longer pallets in and pallets out, the ability to handle the influx of small and large parcel drop-ship orders can overstress your team’s ability to deliver accurately and on-time.  One hundred (100) orders per Customer Service / Order Processing Staff Person each day is about the average rate of productivity.

This is true even if you’ve invested in automation that often consists of an EDI company, an Accounting/ERP System and Shipping Software.  It works, and is certainly better than the “old days”, but – if you look at it closely – there are still a lot of hidden manual tasks associated with that order that cost time and deplete resource productivity.

So, if you’re currently receiving 100 hundred (100) orders per day from a retailer and have one plus (1+)  people processing them, what happens when you’ve earned the opportunity to receive three hundred (300) orders a day.  Do you reject the opportunity, or do you hire and train more people?

 

The first option limits your revenue growth, while the other increases revenue but only maintains your current cost per order and profitability on each item.

 

It’s certainly not a bad thing, but to really take advantage of the revenue opportunity you need the ability to scale your business upward, delivering more on-time shipments each day with the same number or even fewer people. 

 

This provides you the ability to increase your revenue and lower your operating costs.  However, to do this you need real-time order processing that manages a 24×7 workload without human involvement.  

 

OPAL gives you this and more.  It combines all of your order processing and warehouse management activities into one AUTONOMOUS software platform – NO Warehouse Management System, NO Shipping Software, NO Retailer Portals, and NO EDI companies or documentation charges. You just pick and pack and OPAL handles the rest.

Nurturing a Profitable Relationship with Retailers

It’s the most important relationship your business has.  It’s also an incredibly important relationship for your retailers.  When everything goes well, everybody wins.

You already know the advantages retailers get out of working with you as a Drop Ship Vendor (DSV).  

It feels like you’re carrying the load.  And to a large degree, that’s true. But, as you’re aware, there’s a great deal of benefit associated with this relationship.  Nurturing it can be very good for your long-term business survival and growth.

It’s important to remember that retailers can opt to have as many suppliers as they desire and they don’t have to limit themselves to only one brand.   It’s also important to note that poor-performing suppliers cost retailers billions of dollars each year. If you want to be a valued supplier to a retailer, it’s important to make this relationship work for both of you.

So what’s needed to nurture a relationship with retailers?

Well, the first way is to be compliant with a retailer’s business processes.  This includes processing a retailer’s orders, complying with all of the necessary transactions, PO pricing, packaging, labeling, shipping documentation, and accurate inventory feeds.  This compliance makes you valuable to a retailer by reducing its expenses surrounding order issues and rework.

The second way is to have the ability to scale your business upward, delivering more on-time orders each day. This provides the retailer with the ability to increase sales capacity – especially if you can process orders 24×7.  Once again, this makes you valuable to a retailer while also increasing your revenue from that retailer. However, to do this without also increasing your operating costs, you need real-time order processing that manages it without human involvement, 24×7.  

And lastly, to support all of this, you must maximize your warehouse’s efficiency.  To do this requires installing the analytics and tools needed to dramatically increase the number of shipments that can be made each day and their accuracy.  

The bottom line is that OPAL addresses all of this for you and more.  It combines all of your order processing and warehouse management activities into one AUTONOMOUS software platform – NO Warehouse Management System, NO Shipping Software, NO Retailer Portals, and NO EDI companies or documentation charges. 

The Warehouse – The Last Big Cost Obstacle to Drop Shipping Profits

The retail landscape and consumer expectations are changing rapidly and your warehouse is under pressure to ship product in shorter and shorter time frames to meet Retailer requirements.  In addition, the types of orders you now ship are moving from pallets to small packages, increasing the complexity and workload on your warehouse staff. It impacts the areas of order handling and warehouse efficiency and your ability to profitably meet customer expectations.  You need to improve it and move it faster to grow profits.  

 

We all understand that the cost of pickers and packers is a large piece of the cost component for each drop ship order – after all, it’s all about Time and Motion.  Unfortunately, many warehouse operations have grown organically and efficiencies implemented early on may have become lost over time as changes in business occur.

 

Warehouse inefficiency increases Time and Motion and chips away at the profitability of drop ship orders.  So, ask yourself the following questions. Not all may be applicable to your warehouse, but it may help you see where there are opportunities for improvement.

 

  • Is your warehouse organized in a way that minimizes travel time for a picker?  One instance that always springs to my mind was a situation where a bottle and top, sold together the majority of the time, were stored in bins 20 yards apart.
  • Does your picklist sequence minimize the number of steps a picker must make to retrieve all of the items based on Carrier type and pick-up schedule?
  • Do you separate Large Parcel items from Small Parcel items in the warehouse for efficient picking?
  • Do you have all of the brown boxes needed for the day staged at the packer station or do they need to retrieve boxes throughout the day?
  • Do you have bundled master items kitted and ready to ship in advance or do you pick and stage them as orders arrive?
  • Do your packers have to enter box dimensions and weight to create shipping labels or are they manually creating packaging as they go? 
  • Do your packers have to download branded or unbranded packing slips or are they ready to stick in the box?
  • Do your packers have to search for optimum shipping rates or is this predetermined for them?
  • Do your packers have the scanning tools needed to ensure accurate shipments?
  • Are you able to capture and correct addresses automatically to avoid shipments to the wrong address?
  • Do you know how productive your pickers and packers are and how to increase productivity?

 

The bottom line is that OPAL addresses all of these potential inefficiencies and more for you, by providing the tools and analytics necessary to avoid them.  It combines all of your order processing and warehouse management activities into one AUTONOMOUS software platform – NO Warehouse Management System, NO Shipping Software, NO Retailer Portals and NO EDI companies or document charges. 

 

OPAL manages your entire operation, giving you the ability to increase profits through an incremental increase in warehouse efficiency and grow without additional employees.

Why be a Drop Ship Vendor?

You know that big box retailers like Walmart, Target, Kohl’s, etc. are expanding their presence in the e-commerce world as a means to compete more effectively against more agile e-retailers like Wayfair, Overstock and so on.  Like it or not, e-commerce (and drop shipping) is a market segment that’s growing by double digits year over year.

There are BIG reasons for retailers to move in this direction but there are also BIG advantages to the suppliers working as a drop ship vendor (DSV).

One of the biggest advantages is your risk as a supplier can be spread across MANY retailers as opposed to big box programs that can end without notice at any time leaving you with unsold inventory and a huge financial loss. 

Another advantage is better margins.  In typical big box brick and mortar fulfillment you can get beat down on price with the expectation of making it up in volume.  Unfortunately, that rarely if ever happens – you end up taking lower margins due to allowances. 

Lastly, online shopping is a powerful and lucrative force that allows you to be agile and react quickly to market demands, to observe changes and gain a better sense of real-time demand for product making inventory forecasting easier. 

But to succeed you need to follow the Retailer’s rules!  The truth is that non-compliance by suppliers can cost retailers literally billions of dollars in unexpected processing and rework.  When you, as a supplier, make money for your retailers they will value your relationship more highly. 

More and more retailers are recommending OPAL to their suppliers for this reason. 

For the Retailer, OPAL is 100% compliant.   OPAL processes a retailer’s orders for the supplier and complies with all necessary transactions (Acknowledgement, Confirmation, ASN, Invoices, etc.), PO pricing, packaging, labeling, shipping documentation and accurate, on-time inventory feeds in just a few seconds per order.  This speed and accuracy makes a supplier much more valuable to their retailer

For your business’ productivity, OPAL processes orders with a no-touch, self-driving approach that works 24×7, without the need for an additional Warehouse Management System, Shipping Software, Retailer Portal or EDI company.  It also reduces Order Processing time by up to 90%, Order Processing Cost by up to 80% and Undelivered Packages to less than 1%. It also increases Order Accuracy up to 99%, as well as increasing Picker / Packer Productivity and Daily Shipments by 25%-50%.  All without EDI charges.

Can You Process an Order in 5-8 Seconds?

Yes, OPAL will process your drop ship orders in 5-8 seconds, 24 hours a day, 7 days a week, with 100% of the Vendor Compliance required by your retailer and with NO EDI COST!  It will even simplify and reduce the steps required to do pallet shipments. 

But maybe, even more importantly, OPAL is configured to each business’ financial needs and processes – small or large, one size and process does not have to “fit all” businesses. 

OPAL is the only self-driving (think ROBOTIC) order fulfillment software solution in the market today that:

  •         Automates receiving orders from retailers and e-tailers

  •         Manages all EDI transactions

  •         Invoices orders in your accounting system

  •         Manages inventory

  •         Sends inventory feeds to your retailers based upon their compliance requirements

  •         Creates Packing Slips, custom branded 3rd party Shipping Labels per any retailer’s or e-tailer’s requirements, Bills of Lading and UCC128 labels

  •         And, once shipped, it sends back tracking information and invoices to the retailer or e-tailer, as well as tracking packages.

 

All WITHOUT ANYONE managing the order or touching a keyboard.  All you need to do is pick, pack and ship product from the warehouse

It even has Warehouse Management capabilities that can increase the efficiency and output of your warehouse, increasing daily shipments by more than 25%! 

So what does this REALLY mean to an e-commerce business?  Joe Miller, CIO of REACHbarrier, a company that provides an easy, affordable way for homeowners to save on energy costs by reducing their energy consumption experienced this common problem: 

“We have products that sell for $11-$15 and were unable to sell them on-line due to the order processing cost. With OPAL we were able to lower our order processing cost to $.50 cents or less an order, opening up a whole new sales avenue to us. In addition, it used to take two people to process 100 orders per day. Now, we process thousands of orders daily during peak periods.” 

In addition, have you ever thought about how many EDI documents you’re paying for per order?  Well, for a simple drop ship order you are going to need at least five and the average order file size is 1KC (one thousand characters).  Each one costs around $.06 cents. That may not seem like a lot, but here’s what Victoria Bouldin, Vice President of Primetime Petz experienced: 

“We sell our pet gates to the top 20 retailers in the market and were paying $1,100 per month in EDI charges.  With OPAL all of that is gone. The other thing that we really like about OPAL is that it has taken all of the errors out of our order processing.  Everything is accurate and everything ships on time. It’s enabled me to focus on growing the business without having to worry about managing order processing.” 

Are You Prepared for a World Without EDI?

Do you remember the days when business was run through computers that were disconnected?  It’s certainly been a while, but that’s when EDI helped businesses exchange data to save time and cost of transmission. 

EDI has continued to play a significant role over the last five (5) decades.  However, over the last twenty (20) years there has been a major shift in the industry because of Internet technology:

  •         Computers are now seamlessly connected
  •         And data transmission cost is ZERO. 

The only thing that has not changed is EDI.  At this point, it just delays communication and increases your cost per order as a supplier. 

Everybody wonders then: “Why are companies still using EDI?”   The simple answer – resistance to change – AND denial of harsh realities.  The fact is, many retail players are going out business – but not because of their product line—it’s because of antiquated technology and their inability to adapt. 

The unrelenting pace of eCommerce and the proliferation of drop shipping is forcing retailers to rethink the use of such an outdated tool as the backbone of their business operations.  They need technologies that work in real time that allow data to be transmitted from one system to another in seconds WITHOUT those expensive EDI Document fees for themselves and their suppliers.  Progressive retailers such as Wayfair are already moving in this direction and others will follow. 

As a supplier you know that all companies, large or small, that sell product on-line or for warehouse fulfillment to retailers and e-tailers eventually find themselves in a position where they need to rely on EDI to communicate with them.   It’s a hassle, forcing many suppliers to employ individual(s) just to manage it and keep it accurate.  

So, does EDI really have a sustainable future?  Some experts are predicting as little as five (5) more years before it’s obsolete in its current form.  

That means that, as a business, you have two options:  You can continue as things are and possibly wait till it’s too late, or you can investigate OPAL.  

OPAL (Order Processing and Logistics software) has already eliminated current EDI charges for communication with your retailers and 3PLs – AND already has the capability to provide this communication in the real-time method that retailers will be coming to expect.