eCommerce in a Wholesale Timber Environment. Is it Achievable?
In my 15 years of experience in the Australian timber industry, 9 out of 10 wholesalers I have spoken with express the viewpoint that eCommerce is not suitable for them, let alone not achievable, falsely believing that it contains many features not applicable to their business model.
However, in this article, I want to tackle this misconception and explain just how eCommerce can allow your wholesale business to expand and more efficiently process orders, while seamlessly integrating with your Timber ERP system.
While it is true that some eCommerce features are not needed in a wholesale environment and may never be needed, overall, eCommerce will provide immense benefits for your business, ensuring that you can increase productivity and convenience for your customers, all while spending less time managing sales. This will ultimately allow you to spend more time on what is most important to you and your business.
Why is this viewpoint held?
The Wholesalers that I have spoken to generally have 3 primary concerns with eCommerce:
The fear of being viewed as competing with their customers through an online portal open to anyone with internet access
The inability to implement their pre-existing (and often complex) sales processes.
The lack of a suitable business model for integration of online sales with physical stock delivery
This often contains levels of negotiation and traditional sales methods conceding over handshakes
As you will soon see, each of these issues can be overcome through a well thought out eCommerce implementation which ties directly into your sales process, providing a smooth and convenient ordering facility for your customers.
Benefits of eCommerce in a wholesale environment
The benefits of eCommerce to a wholesaler are strikingly similar to those of a retailer. In my previous two articles, “Utilising Technology to Enhance Your Customer Experience” and “The Missing Link in the Timber Sales Process”, I explained how fully utilising a modern ERP product, such as TIMMSanywhere™, can provide many benefits for your business and improve your overall sales process. While these articles may feature some benefits not needed (or wanted) by wholesalers, a majority continue to apply to your business, such as:
Convenience and easier procurement for your customers
Firstly, an online portal will allow your customers to order a product from anywhere in the world at any time, regardless of your businesses’ opening hours, ensuring that you are not staying late taking orders. This also takes into account the time-poor nature of many clients by providing them with a quick ordering process whenever they have time.
An online portal will also allow your customers to easily and quickly access up to date pricing information, which can be individually customised, ensuring that you accurately apply all negotiated prices, including any discounts and rebates.
Finally, an online portal ensures that your wholesaling business spends less time on each individual sale, allowing you to deal with more pertinent issues (and perhaps some more personal time!).
Greater insight into orders and access to vital information
An online portal provides both you and your customers greater insight into their past, current, and (hopefully) future orders, including vital information and tasks such as:
Tracking current orders (including delivery date)
Viewing previous orders
Viewing previous invoices (including any owed payments)
Paying invoices (depending on payment method)
Your current stock levels
Product information (MSDS, installation instructions, etc.)
Credit limit check and outstanding debts
Database of all orders and integration to ERP software
In TIMMSanywhere™, a single database of all current and previous orders allows you to closely track stock levels and sales targets, all updated automatically after every order.
The use of an online portal also removes the need for your staff to manually input order details, ensuring that all orders are complete and correct, eliminating the headache of incorrect and incomplete orders.
Finally, maintaining an extensive database of sales data will enable you to more easily provide individual and customised service for each customer, ensuring that you maintain the best possible relationship with your customers.
Faster and better integrated delivery
An online portal both allows you to instantly turn an order into a delivery for your customer while also enabling them to have greater insight into the process, providing information such as delivery timeline and the current stage of the order.
An eCommerce solution can also integrate directly with your scheduling service (taking into account all confirmed sales orders in your system), enabling you to have up to date information regarding delivery activities and movement of stock.
Implementing eCommerce in a wholesale environment
While it is true that in a wholesale environment the role of an eCommerce system is slightly different than in a retail environment, the basic principles behind it remain the same; that is, to increase convenience for your customers while ensuring that the entire sales process is integrated, allowing for a quicker turnaround and delivery.
For a wholesaler, the most significant difference in the implementation of an eCommerce system is the addition of a secured portal, which will ensure that only pre-authorised customers have access to the ordering portal, ensuring that you do not intrude into your customer’s retail market. This eliminates the most significant of the issues expressed by wholesalers. Furthermore, the unique eCommerce features provided by TIMMSanywhere™ completely negates both other issues raised by most wholesalers, primarily through tight integration of the customer portal with all other information contained within your ERP system. This ensures that all vital configurations, particularly negotiated prices, discounts, and rebates, apply correctly for each customer, allowing your pre-existing pricing structure to remain exactly the same.
As such, the process for an eCommerce solution for your wholesaling business would most probably look as such:
In the pre-activation stage, a number of necessary tasks would be undertaken, exactly as if you were taking on a customer without an online portal. These tasks include:
Credit application for the customer
Identification of products needed by the customer
Explanation of pricing structure, including potential rebates and discounts
Negotiation of prices and payment terms
Explanation of any other applicable terms and conditions
2. Customer set up
In the customer set up stage, tasks pertaining primarily to customer access to the secured online portal are undertaken, including:
Distribution to customer of setup link(s) (via email)
Set up of logins (usernames and passwords) by customer
Application of any necessary changes to pricing (Rebates, Discounts, etc.)
Continuation of any necessary set up activities from pre-activation
3. Online purchasing enabled
Within this stage, all customer accounts will be provided with access to the online portal and their purchasing will be enabled. From this point onwards, little interaction is required from your business for ordering online, with customers able to utilise the secured online portal at their convenience. Of course, it must be noted that this is not the only way to order; customers can still always call your designated Account Manager and are not required to order online.
4. Purchasing and Delivery
When a customer places and confirms an order via the online portal, the system will automatically create a sales and picking order in TIMMSanywhere™ to process the sale. From this point onwards, orders are treated exactly the same as any other order, with deliveries scheduled and product sent.
Outside of the eCommerce system, existing Sales Reps and Account managers will continue to build relationships with your clients (including taking orders if requested). Their focus will shift, however, from securing orders, to building strong and lasting relationships with customers which will, in turn, secure future orders.
With a thought-out and well-implemented eCommerce solution, the ordering process for your wholesale business can be greatly improved and streamlined, resulting in greater convenience for your customers. At the same time, it greatly reduces the number of manual tasks that you and your staff need to perform, providing you more time for the things that really matter!
Felix Choo - MBA B.ENG – CEO, TIMMSanywhere™
Having worked in national and senior roles in both Timber and Packaging Industries, Felix has gained significant experience and knowledge in a variety of businesses and business processes. Being a creative problem-solver, he is a great listener and seeks to understand a client’s challenges and difficulties, before strategising and proposing a solution.
Felix is a man of many talents, approaching challenges head on which assists his strategic decision making by turning ideas, thoughts, or even a bit of scribble on a post-it note, into massive action with excellent results. Felix is passionate about working side by side his clients as they grow and he works with them to achieve great things.