Woman working inside her shop while sitting on the phone and looking at a laptop.
Supply chain technology is helping businesses reach their customers at a time when logistics costs are rising and shipping and transportation infrastructures are bottlenecked. — Getty Images/Maskot

How three growing companies are driving profitable sales:

  • Home gym equipment brand Bells of Steel is using multiple technology tools to better manage its inventory as sales increase.
  • Oral care brand Snow Cosmetics is optimizing its service levels with supply chain insights.
  • Snap Supply, a maker of appliance repair parts, is converting customer service contacts into wholesale customers.

Bells of Steel, Snow Cosmetics, and Snap Supply are all successfully leveraging multiple technologies to navigate a challenging supply chain environment and drive profitable sales growth.

E-commerce can open doors to markets around the world, but companies shipping their products to far-flung markets, or even across the country, must also consider what it takes to reach those customers. Especially at a time when logistics costs are rising and shipping and transportation infrastructures are bottlenecked, managing distribution and measuring profitability are critical.

Bells of Steel: Real-time inventory visibility helps quintuple sales to $15 million

Bells of Steel, which sells home gym equipment through its own website and other platforms, has grown its business significantly in the past few years as many consumers transitioned to working out at home, said Kaevon Khoozani, president.

The company sells exercise equipment directly to consumers through its website, which accounts for 80% of its sales, with the rest coming from sales to gyms, retail stores, and on Amazon.

Among the challenges the company had to solve for during the pandemic, however, was the rising cost of shipping, with costs per container from Asia rising several folds.

“It was really throwing off our books,” said Khoozani, who noted that the company wasn’t always properly allocating monthly container rates for imports to align with the costs of its products. “Sometimes our profit and loss statement at the end of the month would just look completely discombobulated.”

In addition, keeping track of inventory across four warehouses and optimizing shipping from those warehouses had become time-consuming. The gym equipment brand automated that aspect of its operations with the help of its enterprise resource planning (ERP) platform, which has helped significantly, he said.

One of the ways that Bells of Steel is managing its logistics is via ClickUp, a project-management type application that helps the company automate the processes that need to take place at each warehouse, among other functions. It allows Bells of Steel to automate notifications of product movement within its supply chain, giving the company much better insights into the status of inventory levels.

“For example, when a container arrives at the rail terminal in Chicago, ClickUp would trigger an email to our Indianapolis warehouse manager saying, ‘Hey, this container has arrived in Chicago, and you should see it in a day or two,’” said Khoozani.

The software has also helped the company optimize its promotions by better organizing the processes it uses to execute marketing initiatives.

“Once you create a good process for a sales launch, you can then save that as a template in ClickUp and use it every time you have a new sale to do,” said Khoozani.

These and other technology investments have helped Bells of Steel grow during the past two years from a team of six employees to more than 50, while sales quintupled to about $15 million a year from around $3 million, he said.

[Read: Big Brands’ Inventory Management Partners Share Top Tips to Slay Supply Chain Snarls]

Especially at a time when logistics costs are rising and shipping and transportation infrastructures are bottlenecked, managing distribution and measuring profitability are critical.

Snow Cosmetics aligns inventory to meet demand as annual sales double

Snow Cosmetics, a premium oral care company specializing in teeth whitening, had historically marketed its products through dentists’ offices and retail stores, but pivoted to focus on direct-to-consumer sales when dental offices closed during the pandemic.

“We needed to improve our [inventory] forecasting model dramatically, because forecasting kind of got thrown out the window during the pandemic,” said Trevor Martin, vice president of operations.

Another key need was to get its supply chain better aligned with customer orders, he said, so that it could fulfill orders from the right warehouse to reach consumers with next day delivery across the U.S.

“It really started with the centralizing of the data,” said Martin.

The company installed Brightpearl as its retail operating system last year, which granted Snow Cosmetics real-time analytics around which products were sold and where.

In turn, “We're able to manage the inventory that we have on hand much more effectively and efficiently,” said Martin.

The ability for Snow to easily integrate other applications into Brightpearl’s retail operating system provided a big boost, he said.

“We had lacked that connectivity,” Martin said. “We had dozens of applications running, and to be able to have all those systems, and a hub that can communicate that data, it was huge. That changed the way the company operates.”

Snow was able to leverage this visibility to better analyze the returns it was getting on shipping to customers overseas, for example.

“Understanding the freight cost for international led us to change our entire policy around international shipping,” said Martin. “Now it is a much better experience for the customer.”

Previously, it was taking as long as four to six weeks to fulfill orders through a previous shipping partner, he said. Now, international shipments arrive in about a week, which has driven gains in customer satisfaction while maintaining profitability.

“We have one of the best customer experience scores in the industry,” said Martin.

Perhaps most importantly, since installing the Brightpearl ERP platform, the company’s revenues have doubled, compared with the preceding year, he said.

[Read: How to Monetize the Metaverse: Big Brands' Tech Partners Share Tips]

Analyzing costs delivers for Snap Supply: ‘Once we know that it sells, we can really and truly invest in it’

Nick Ernst, a partner at Snap Supply, which sells appliance repair parts, also used technology to gain visibility into the profitability of individual SKUs as well as the performance of its platforms.

The company sells via multiple e-commerce channels, including through its own website and on Amazon and eBay, and uses analytics to help gain better visibility into its true costs across products and wholesale channels. This is particularly important amid rising fulfillment costs, Ernst said.

Digging into the actual costs of sales led the company in 2020 to abandon selling through the seller-fulfilled Amazon Prime service, months before the e-commerce giant canceled that offering. Snap was able to make up for the $800,000 in lost sales “almost in the first year,” said Ernst, by promoting its best-selling products.

“Once we know that it sells, we can really and truly invest in it,” said Ernst.

Another key sales driver for the company is its Zendesk software, which Ernst described as a vital tool for providing customer service across multiple platforms.

Specifically, Zendesk helps convert customers who contact Snap for support into wholesale customers, which is one of the fastest growing aspects of Snap’s business right now, Ernst said.

Snap follows up with customers who contact the company for support by sending them a catalog and getting them to open a wholesale account.

“If we can get those two steps accomplished, there’s a good chance they are going to buy from us on our wholesale side,” said Ernst.

He estimated that about 10% of the business customers that Snap interacts with on other channels become “solid customers” on its wholesale site.

Many of the customers who buy products on Amazon or eBay, for example, may not be regulars, but may be seeking a quick turnaround for an item. These could be repair technicians, for example, or housing authorities or housing management groups that will likely have additional product needs.

“That’s where these processes come into play,” said Ernst. “We try to convert those customers into wholesale accounts.”

Snap also recently entered a beta testing program with Amazon called Buy with Prime, in which it can use products that are stored in Amazon’s warehouse to provide an Amazon Prime-like experience through its own website. It requires having a minimum inventory on hand at a specific location in order for it to be activated at that warehouse.

Ernst said he hopes to use the new platform to increase sales and service levels in geographic regions that are currently out of range of its lone warehouse facility in Illinois.

“If someone needs an air conditioning motor overnight, we might not be able to get it to them, but Amazon can, because they have inventory in that state,” said Ernst.

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Published August 02, 2022