Growth has a downside. Especially when it comes to scaling multi-channel order management.
How do you overcome complexity to get results like …
- Young & Reckless reducing inventory error 35% growing an O2O empire?
- Sunski cutting their time spent on inventory management in half?
- Venley saving nearly $160,000 annually through automation?
As online businesses mature, front-end challenges like attracting new customers, increasing conversions, and generating orders soon give way to a host of back-office challenges:
- Tracking inventory and orders across multiple channels
- Expanding internationally without sacrificing fulfillment times
- Maintaining customer loyalty through high-volume sales events
- Merchandising unique offers like preorders, backorders, and bundles
- Selling through multiple brands, online storefronts, and even big-box retail
These high-growth strategies create complex management workflows that threaten the very growth propelling them. That’s why we’re examining …
Seven multi-million dollar companies that have mastered multi-channel order management:
- Thinx Automated International Logistics for a $36 Billion Market
- Young & Reckless Reduced Inventory Error 35% While Scaling O2O
- Chubbies Grew Repeat Purchases 70%, Decreased Backorders by 93%
- Sunski Cut Time Managing Inventory in Half for 50,000 Customers
- eCig Distributors Oversees Nine Brands for ‘Quick Turn CPG Products’
- Venley Saves $160K Annually Solving their Duplicate Inventory Problem
- Thread Wallets Grew 420% YoY and Entered Big-Box Wholesale Retail
Are you selling everywhere your customers buy?
Keep reading to discover how to manage multi-channel orders. But if you’d like an executive overview, download The Enterprise Guide to Multi-Channel Ecommerce.
Inside, you’ll get one-pagers detailing …
- Comprehensive data on the opportunities and threats
- Business spotlights for insights on top channels
- Checklist for selecting the right multi-channel platform
1. Thinx Automated International Logistics for a $36 Billion Market
Looking to disrupt what’s soon to be a $36 billion market, Thinx was in search of an inventory management system that would allow for global expansion and free them “from Excel and just brute force.”
“We started testing international markets in early 2017,” says Dan Wang, Director of Operations at Thinx, “and quickly realized we had an international audience with a huge need for our products.”
“We thought a lot about how we make sure that the fulfillment experience is also good for international customers and how do we manage multiple warehouses when our team is relatively small. So, basically what’s the maximum result with the minimal starting resources?”
Previously relying on manual processes and an inventory management software not equipped for multi-warehouse order logistics, the Thinx team turned to Stitch to gain the operational visibility and control they required in order to grow.
Thinx now has a robust and flexible operational foundation on which they can rapidly test new markets, expand, and grow their business both domestically and globally.
2. Young & Reckless Reduced Inventory Error 35% While Scaling O2O
Young & Reckless is an LA-based streetwear brand founded by Chris “Drama” Pfaff in 2009 — “a millennial with no business experience or college education,” as his Forbes feature put it. Within six years, Y&R had become a fashion staple with annual revenue of $31 million (as reported by Forbes).
That was 2015. Since then, Y&R has continued to scale both its offline (through retail wholesale) and online businesses, growing another 25% year-over-year between 2017 and 2018.
When the team decided to divide their business into two ecommerce sites while still managing multiple wholesale channels, they realized their current processes — a cumbersome ERP and labor-intensive spreadsheets — were leading to inventory counts with a margin of error of up to 40%.
Within six months of implementing Stitch, the Y&R team saw a 35% reduction in their inventory margin of error from 40% down to 5%.
“There are so many moving parts and now we can see exactly how many units are set aside for marketing, how many for wholesale, etc.” says Y&R’s Business Operations Manager, Anjulei Aurelio.
“We used to have to manually separate inventory which was disorganized and chaotic. If we didn’t have enough units to fulfill a retailer or independent order, there was always the question: why don’t we have it? It was horrible. Managing our inventory with multiwarehousing is amazing.”
[O]ur sales numbers have increased while errors have decreased, providing us with a scalable way to react and grow rapidly.
3. Chubbies Grew Repeat Purchases 70%, Decreased Backorders by 93%
As purveyors of the “the most jaw-droppingly radtacular shorts ever,” Chubbies is much more than a product company — it’s a lifestyle brand. Having built a rabid following across social media, to the tune of over 3 million fans, loyalty is key to Chubbies’ success. Of course, keeping customers happy and returning is more complicated than awesome shorts and hilarious marketing campaigns.
To keep demand high, Chubbies runs several major promotions throughout the year — including Thighber Monday (shown above) and Julyber Monday (shown below). These events bring increased site traffic and a major influx in orders.
Unfortunately, new customers that arrive through sale events are notoriously difficult to transform into repeat customers. And the team worried about the effect backorders incurred during these promotional days would have on customer experience and satisfaction.
With Stitch, Chubbies is able to set aside reserve stock to protect against imprecise counts at their 3PL. This gives their team better visibility and control over inventory, helping them avoid costly backorders and frustrating customer experiences.
Preventative measures decreased backorders by 93% compared to the previous year.
In addition, Chubbies’ customer loyalty program — which sends “chubsters” add-on gifts for their first eight purchases — is now managed through an API. “If we want to change a gift in a loyalty tier round, I can do that in 5-10 minutes,” explains James “Tater” Hargett, Manager of CX and Fulfillment at Chubbies. “Previously, that would have taken two days.”
The result was a 70% increase in repeat purchases from returning customers.
4. Sunski Cut Time Managing Inventory in Half for 50,000 Customers
Things were going swimmingly for the founders of Sunski. Having raised over $150,000 on Kickstarter in 2012, their distribution formula was taking shape. A year later, a third of their sales were sold directly to consumers via their online storefront, a third through U.S. retailers, and a third through international distributors.
Although diversification was healthy, managing it was difficult for operations. Sunski was popular across Shopify, NuORDER, and Amazon, but their one-man operations team was having a hard time keeping track of increasing inventory and orders on disparate data systems — namely Excel and Google Docs.
As a remedy, Sunski integrated each sales channel and consolidated inventory and order data into a central location. This centrality also lets them evaluate sales velocity and SKU performance, providing additional context into sales and operations.
Now serving over 50,000 customers, Sunski’s team can call on in-depth performance insights, and forecast with increased accuracy. More importantly, their team spends 50% less time managing inventory.
5. eCig Distributors Manages Nine Brands for ‘Quick Turn CPG Products’
eCig Distributors has grown into one of the largest vapor and e-cigarette companies in the world. It has also morphed into a completely different business than the one it started as. Through its eJuices.com and eLiquid.com brands, it sells direct to consumer, through wholesale, and in brick and mortar stores. It also runs an advertising business, eLiquid Ads, and an industry website, VapeShows.com.
To service their growing empire, eCig Distributors created nine Shopify accounts, but without a centralized inventory management system maintaining accuracy was nearly impossible.
Stitch worked with eCig Distributors to integrate inventory and order data into a central location for increased visibility and control. With complete visibility and control over inventory and orders, eCig Distributors runs smoothly and their team saves hours of manual order management using the API.
Stitch has given us the ability to operate several high traffic websites more effectively and efficiently by reducing inventory issues related to selling quick turn CPG products.
6. Venley Saves $160K Annually Solving their Duplicate Inventory Problem
Since 2010, former fraternity brothers Nick Ventura and Kevin Gressley have built Venley into a powerhouse fashion brand with over 600 employees.
The problem was … Venley’s products are designed for both men and women. The team needed a solution that could account for duplicate unisex products sold on different marketplaces.
Gressley, Venley’s COO, explains, “It was a pain because, say we had 12 pieces: six men’s and six women’s. Women’s would sell out and men’s would be sitting there — even though the product was identical — so we’d have to manually shift that inventory.”
By linking product SKUs at the variant level, Venely could list items in different categories while still being tracked against the same inventory pool as well as monitoring …
- Low-stock alerts
- Purchase orders
- Overflow fulfillment
Venley saved nearly $160,000 annually and put that time and money toward growing the business. They were able to automate four full-time employees worth of manual inventory management. Gressley says, “If you have a multimillion dollar business and you want to scale, you have to be with Stitch or something like it.”
7. Thread Wallets Grew 420% YoY and Entered Big-Box Wholesale Retail
After establishing Thread Wallets in 2014, Colby Bauer and his wife Mckenzie handled all aspects of their business in-house for the first year. However, as they grew from $150,000 in revenue to $250,000 during year two, then to just over a million by the close of 2017, complexity mounted.
Those numbers make them the only company on this list below $5 million in annual sales, but they also equate to a 420% year-over-year growth rate.
“I quickly realized that our disparate app solutions with weak integrations were not equipped to handle our rapid growth,” says Colby. This was especially true as their distribution channels expanded from one Shopify store to three stores, Amazon FBA, and big-box wholesale retailers like Urban Outfitters and REI.
For Thread Wallets, this meant connecting multi-channel inventory management, purchase orders, as well as wholesale EDI and SPS integrations.
“What it came down to was that our previous process was working, but in order to scale,” Colby explains, “it needed to be cleaner. Everything needed to be in one place. With Stitch, the order management and inventory management is all right there.”
Final Thoughts on Multi-Channel Order Management
Multi-channel order management is a challenge every rapidly growing business faces.
In earlier stages, the primary challenges revolve around product design and marketing. Brands in the high-growth phase experience a shift in focus onto managing high-order volumes across multiple channels — while still delivering exceptional customer experience.
This gets infinitely challenging as brands implement unique merchandising strategies and workflows such as pre-orders and bundles, and geo-routing orders over a growing number of channels. Manual order management processes that sufficed in the earlier days of the business quickly turn time-consuming and error-filled, leading to inefficiencies, poor customer experiences, and lost sales opportunities.
Without a scalable solution that provides a strong and stable operational foundation to expand their business — both in terms of number of channels and complexity — brands will quickly find themselves in positions where their operations can’t keep up with growing demand and the operational challenges presented by supporting merchandising and marketing, ultimately bottlenecking their own growth.
Stitch Labs is a leading inventory management software that helps multi-channel, high-growth brands streamline and gain control of their operations to set them up for scalable growth.
About the Author
Ellie Kulick is an experienced Marketing Communications and the Content Marketing Manager at Stitch Labs based out of San Francisco, CA. Passionate about technology and health, she is constantly looking for new challenges in effective communication and creative content development to help businesses grow and engage with current and prospective customers.