Two takes on delivery Ironmongery Direct
How Ironmongery Direct and Boden efficiently handle their delivery requirements
With an imminent move to larger, purpose- built premises, comes an opportunity to look broadly at supply chain management and how further improvements in operating efficiencies can be achieved. That’s exactly what Alan Josiah, Ironmongery Direct’s head of fulfilment and Stuart Wilson, the company’s head of marketing, are currently working on. Ironmongery Direct is one of the fastest growing multichannel suppliers to the trade; turnover for the half-year rose 25 percent to £7.1 million, while operating profit grew 40 percent to £750,000. In September, it announced it had secured a seven-figure financing deal with Santander Corporate Banking. The funds will allow the company to move into new 50,000 square-foot premises that will enable it to centralise stock in one location, enhancing efficiency as well as improving its next-day delivery service.
A bigger warehouse is a core new asset and will allow the business to continue its six years of consecutive growth through range expansion and operational efficiencies. With a catalogue of 11,500 specialist ironmongery products, Ironmongery Direct is always mindful that getting the goods to the customer reliably and speedily is critical.
Boden
Josiah and Wilson know the customer’s delivery is essential to their business, “as time costs money”.
The company’s trade customers are very much driven by a need when they purchase. The goods are often for a particular project and in many instances can’t be sourced locally.
Improving delivery rates The business prides itself on its 7.30pm cut-off for next-day delivery. Correct management of delivery options is therefore essential to ensure efficient service and maintain trust with the customer. To help it identify the right delivery firm for its needs, Ironmongery Direct uses MetaPack’s delivery management system. The system enables the business to flag and set parameters, allowing it to select the right carrier and to test carriers. It can look right into performance on a local level to within postcodes and analyse and select which is the best carrier for the job based on criteria such as morning delivery or large, bulky orders. Using the system means Ironmongery Direct’s first- time delivery rate averages 98.5 percent. Looking ahead, Josiah says the next stage will be to “fully automate the warehouse fulfilment centre and we’ll use conveyor systems to pick and pack in one solution”. For now, the company is focused on “relishing the opportunity of having more scope and space to grow”.
Apparel brand Boden recently posted record profits despite the challenging economic climate. Having started with just eight items in 1991, the company now delivers to 62 countries from the UK, generates sales of more than £230 million and profits of more than £32 million. In September 2011, Boden expanded into France, with further European expansion earmarked for the near future.
For the past three years, Boden has been using P2P Mailing to provide international and domestic mailing services. It currently distributes in excess of 2 million Boden packages per year from the UK to other parts of the country and across the world, mainly to the USA and Germany.
Boden says the partnership has been very cost-effective, “I believe that we’ve saved between £80,000 and £100,000 on the cost of shipping our domestic packages alone,” says Chris Potter, head of operations development at Boden.
Money has also been saved through changes to operations management. For example, the number of separate collections was lowered by consolidating different markets and routes into fewer consignments. This means that the amount of handling and sortation required at the Boden distribution facility is considerably reduced. Boden says it has saved in excess of £200,000 this way, in respect of the packages going to USA alone.
As well as bringing down costs, reducing the number of vehicle journeys has the added benefit of reducing carbon emissions, an important consideration for today’s green- minded businesses.
Success is driving further development of the relationship. While P2P currently distributes Boden packages weighing less than 2kg, the companies are currently in discussions regarding the delivery of larger packages and handling Boden’s returns service.
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