I started with a retail supply company shortly after they had lost their good standing with Amazon for 5 days, costing them approximately $80,000. B2B had been their bread and butter and was operating normally through their warehouse. Their B2C dropship channel was in dire straits. Their core physical problem was their order process required a manual interface between the vendor and the warehouse. For B2B orders that are one order for thousands, this was manageable. But dropships are thousands of orders for one item and that became too cumbersome. Automation was attempted but was unsuccessful. Their core strategic problem was there was no strategic thinking.
A few years ago, the company started selling in a new channel – B2C via dropship. This channel grew consistently until it represented 42% of the annual revenue.
To support this channel, they had hired a 5-person team out of India to work directly with each vendor on each order to validate the vendor received the order, find out when it will ship, and acquire the tracking number when it did ship. The previous year, to reduce costs, they replaced this team with a home-grown software package. Unfortunately, the software only covered 20% of the necessary work. The balance of work organically fell on the Buyer Team. The 2-person Buyer Team was responsible for similar tasks for the B2B orders for the few vendors with no automation and exceptions. The Buyer Team was not able to take on the extra work and they got further and further behind. Every sales person in the company needed these 2 people to get the information they needed to give it to their client, but no information was forthcoming or available. Tensions were rising. Interruptions were constant. Priorities were unknown. Other teams were calling the vendors themselves just to moving causing delays in their own departments. The shipments themselves were getting delayed, negative online reviews were appearing, and Amazon closed them down for 5 days.
Fix the problem; ensure Amazon doesn’t cut them off again.
Primary recommendations at the end of the first week:
- Add a step to document all actions and results by the Buyer Team. Examples of the needed detail were included.
- Get channel order priority approved, documented and implemented into their daily routine.
- Create a three-week event that restrict all employees from contacting the Buyer Team for any reason in an effort for them to get caught up.
- Review all exceptions, determine accurate resolutions, and document the approved processes.
- Documentation steps made a big difference and reduced a lot of the interruptions and duplicate efforts.
- Channel priority reduced friction and improved critical outcomes – Amazon was the priority.
- Three-week no-interruption event delayed due to a family emergency.
- Exception documentation was in flight.
Contract cut short due to new CEO.