This article appeared in ‘The Australian’ newspaper a week or so ago and it contains some encouraging news for all in the kids and baby retail sector.

Anecdotal evidence suggests that things are looking good for independent retailers in the baby and children’s retail industry. This can now be backed up by data from independent research house IbisWorld, which found that parents spend a whopping $1.14 billion on clothing their children. The best news for small to medium enterprises is that the majority of this is spent at small independent stores and those supplying to them. IbisWorld research found that the children’s market is highly fragmented with only 30% being spent at big department stores like Target, Myer, Kmart and David Jones. Even the relatively big independents like Pumpkin Patch, Baby Bunting and OshKosh have only 1-2% of the market each.

Here is the article in full if you are interested: http://www.theaustralian.news.com.au/story/0,25197,25520314-5018019,00.html

It’s encouraging to see that there is at least one sector where smaller, niche business can not only survive but continue to thrive despite difficult economic times.

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The logistics Industry as a whole is probably one of the worst offenders when it comes to sustainability and ‘green’ practices. The nature of the industry requires it to be heavily reliant on road transport and the image often portrayed is one of heavy polluters on the road and thoughtless practices on the ground.
However it is important to realise that given the breadth of Australia’s vast landscape trucks and transport are vital to getting things around from A to B. Furthermore, a lot has changed in this industry, with many companies cleaning up their act and becoming aware of how to do things smarter and cleaner.

At Cross Docks Australia we are trying to improve our green credentials and have gone to considerable lengths to try to make a difference in whatever way we can.

Such as:
• Using warehouse premises that require minimal artificial light and rely more on natural light and ventilation. Every fifth sheet of roofing is perspex allowing maximum light during operating hours, but with out creating heating issues in summer.
• Recycling: from the cardboard cartons that we reuse to pack our clients goods for transport, to the second-hand steel beams in our racking system. Where it can be reused or recycled we are doing it.
• For clients that require fragile packing we use wheat-pack (made from 100%biodegradable wheat dust) and discarded cardboard off cuts.
• The implementation of RF (radio frequency) picking system. Cross Docks Australia have invested in technology that has the dual benefit of increasing efficiency and reducing the amount of unnecessary paperwork.
• Any paper or cardboard that has earned retirement gets recycled by AMCOR
• Because we are not aligned with any one transport company, our clients can choose their own transport option, some of whom offer the purchase of green fleet /carbon offset options.
• We use electric forklifts rather than diesel or petrol machines.
• We have also fitted out our offices with second hand office furniture despite the fact that we could have bought brand new, timber office furniture most of which is shipped in from Asia, for the same price!
• Cross Docks Australia will continue to consider the environmental impact of the major decisions we make, we are also open too suggestions from our clients.

Cross Docks Australia are proud to have strong partnerships with environmentally aware clients like 3fish and Braemac energy. Braemac Energy are a 100% Australian owned company, showcasing a wide range of clean, green Solar and Wind energy solutions for households, businesses and government (www.braemacenergy.com.au/). 3fish describe a simple philosophy of “Do the Right Thing”. They take the full life cycle of each product they are involved in seriously. There is a strong focus on using renewable, organic and recycled materials and products that have been ethically sourced.

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Albi Imports is one of Australia’s premier homeware and giftware importers. Established more then 20 years ago, importing recycled glassware from Spain, Albi Imports has experienced incredible growth in just under a decade. It is now a dominant force in the homeware industry importing a wide range of kitchenware, homeware, glass and ceramics, tabletop and textile designs, from all over the world.

What was the problem?

When Cross Docks Australia first meet with Albi Imports the business had almost tripled in size with a huge increase in their product range and the complexity of their warehousing and fulfilment requirements. This resulted in an increase in work load, demand for space and the need for more sophisticated and detailed work practices.

As a result Albi Imports now faced 2 major constraints in the warehousing and fulfilment side of their business;

• Space: There was no longer room for the stock in the existing premises

• Staff: The capabilities and size of their warehouse staff, could not cope with the tripling in size of orders and products

Additionally there weren’t adequate metrics or processes in place resulting in limited accountability and negligible transparency for customers or indeed even office staff to know where their orders were up to.

In general the whole working environment was extremely reactive and as a result they were only servicing customers at best on a day-to-day basis. Much of the work was done word of mouth and there were no systems or processes in place that tracked orders, tracked inventory or made people accountable for the work that they were performing.

Lost Business/Profit

Measuring loss in business and/or profit is difficult because there is no data to compare to but when Cross Docks took over the warehousing we moved swiftly to cut the backlog of orders jammed in the system and increase efficiency and transparency. A process was established to ensure order information was quickly and efficiently passed between the office staff and the warehouse. This ensured a reliable tracking of orders, inventory and despatch. Cllients could then be sure they were receiving reliable information.

Preparation for Christmas 2004

Albi worked proactively with Cross Docks to establish a new facility that was customised to fit with Albi’s expanding business. Using past and forecasted sales data, Cross Docks designed the warehouse to be customized to fit the current arrangement, yet flexible enough to allow for further growth and changes in product mixes and order complexities.

Milestones Achieved
In just eight weeks after taking on Albi as a client Cross Docks had achieved the following tangible benefits and the warehouse was running like a well-oiled machine:

• Staff levels and activity were appropriately managed with a rostering system that accommodated peak times and staff deployed to suit their skills. By taking over the warehouse staffing, it was one less headache for Albi and Cross Docks were able to manage staff numbers with greater accuracy.
• The warehouse increased order throughput by 50% and decreased order turnaround from 5 day average to less than 2 day average.
• Number of units picked per hour had also increased by 50% with the increased efficiency flowing through to all aspects of the business.
• Moved the stock to a new warehouse with custom-designed layout

Other value-adds to the business was the implementation of a network-based tool that enabled Albi’s customer service team to have real time access to order status information ensuring that they had current information to provide to their clients, ability to top up orders at the last minute and giving valuable information to their clients that gave them a competitive edge in the market place

Albi Imports is just one of Cross Docks Australia’s valued clients. We are constantly working to improve our business processes for our clients, so that they can then pass that value on to their customers.
To find out how Cross Docks Australia can improve the warehousing and logistics side of your business and allow you time to get on with what you do best, call Shan on 0413 745 555.

Cross Docks Australia have partnered with boutique children’s clothing label mila&milo to deliver benefits to the business.

Mila&milo specialises in importing and distributing premium quality Dutch clothing and accessories for children. When mila&milo first engaged the services of Cross Docks Australia, there were four major benefits we aimed to deliver:

BUY MORE TIME: More time to focus on core competency:
An understanding of operations is important, however mila&milo identified that it wasn’t their field of expertise. “Many business don’t anticipate how time intensive operations are”, says Cross Docks Australia’s Managing Director Shan Manickam. “It’s the time spent receiving stock, putting it away, picking orders, packing them up and sending off, that is to say nothing of storage costs, maintaining stock inventory and the cost of your own time to do this.” By outsourcing this aspect of the business to Cross Docks, mila&milo were able to focus on their core competencies of research, buying, fostering relationships with existing clients and developing new business, confident that the back end of the business was under control. We believe many small business people don’t value their time in performing these tasks, tasks we can do a lot more efficiently, thus allowing you to focus on expanding your business.

FITS LIKE A GLOVE: A tailored warehousing and distribution solution: On meeting with mila&milo, Cross Docks Australia’s first job was to ascertain the specific needs of their prospective client. Rather then fitting a square peg in a round hole, Cross Docks Australia developed a tailored solution to fit the growing needs of the business. Cross Docks Australia also offered warehouse growth capabilities with the space and flexibility to cater to fluctuating stock levels, seasonal variations or increased demand for stock.

KEEP IT SIMPLE: Simplifying the rate and streamlining costs: Of course great service is important but the vital thing was for mila&milo to achieve this within their logistics and warehousing budget. Cross Docks Australia offered mila&milo a fixed cost per unit arrangement which offers a simplified invoicing system and allows mila&milo to accurately predict what their logistics costs will be. This simple system improves budget forecasting and reduces the difficult and time-consuming process of deciphering what costs were for what service.

CONTROL AT THE TOUCH OF A BUTTON: Control and transparency of stock and stock movement Many businesspeople fear a loss of control when outsourcing a part of their business but with Cross Docks Australia, mila&milo were able to achieve constant visibility of their inventory and stock movement. With the RF (radio frequency) pick and pack system the data movement is visible through a web-based inventory system. This gives mila&milo real-time access to every detail of their stock and the ability to interface/integrate IT systems also decreases the double handling of data.

In the business of logistics and warehousing there is no product to sell; we instead rely on fostering strong client relationships and delivering the most efficient processes, resulting in unbeatable service. All of these ingredients are vital to a successful 3PL (third party logistics) business and go to the core of the Cross Docks Australia philosophy of being Professional, Proficient and Precise.

1. Provide a Purchase Order Number.
   As simple as it sounds you need to ensure that you provide a Purchase Order (PO) Number when ordering stock. In doing so you will achieve the following:
   You will be able to cross reference your shipment with what you ordered. Your supplier should reference the PO number on your invoice and on the Packing List they supply with the goods.
   It will ensure that your suppliers will only send you stock when you order it, not when they feel like sending it to you.
   It will provide you with a reference point if you need to recall the stock some reason at some point in time in the future. Product recall is an arduous task and compounded by poor referencing and record keeping.
2. Uniform Naming Methodology.
   It is vital especially when using multiple suppliers that they all use the same naming methodology. For example if you use a blend of alpha and numeric digits in your product codes, then ensure that all your suppliers provide the same alpha and numeric naming structure in your product codes.
3. Insist that your cartons are clearly marked.
   Insist that your company logo is printed on the outside of each carton. This will assist in preventing your cartons getting mixed up during loading and unloading containers, will ensure that your products stand out against your competitors and your logo looks good.
4. Up to date inventory levels.
   This must be your primary focus all the time. Regardless of whether you are maintaining your inventory levels or a Third Party is maintaining your inventory levels, ensure that they are accurate. Accurate inventory levels will allow you to sell your stock accurately, order stock accurately and ultimately understand the value that your business has reinvested into your Balance Sheet.
5. Ensure that you have a Quality Assurance (QA) process for new stock.
   Supplying quality products must be one of the instilled principles of your business, and by employing a sound QA process will assist you in achieving this. Replenishment stock from existing suppliers should not require QA processing, however new stock lines must be QA processed. If you are using an agent to help source your stock then make it one of their responsibilities. Product quality will never be perfect so ensure that you have the right measures in place to intercept the product before it gets to your customers.
6. Minimise your Suppliers.
   There is no need to put all your eggs into one basket, but at the same time don’t spread yourself too thin with multiple suppliers. The advantages are as follows:
   ?You should receive consistency in service when consistently purchasing from a small group of suppliers
   ?Over time you should receive more favourable payment terms from your suppliers. As your purchasing increases with them ask them to reward you with favourable payment terms.
   ?Your purchasing power will also increase. Increased purchasing power will enable you to negotiate more competitive pricing which should allow you to be more competitive in your market place
   ?You will minimise your risk when it comes to your suppliers replicating your intellectual property and selling it to one of your competitors.
7. Reconcile the PO against the Packing List (PL).
   Remember that what you order may not be what you receive. Request that your supplier send you a copy of the PL when the goods are despatched. That way you will have at least a couple of week’s to reconcile the PO against the PL. The benefit of doing so is that it will allow you to re order stock as soon as possible if you need to do so.
8. Reconcile the physical stock against the Packing List.
   It is vital that you reconcile the PL with the physical stock. There should be ZERO tolerance when conducting this reconciliation. The PL is a representation of what was physically packed on your behalf. If they do not match then there is a strong chance that there has been theft somewhere between the stock being despatched from the factory and you receiving it.
9. Provide Feedback.
   It doesn’t matter if it is positive or negative, but ensure that you supply it. Your quality suppliers will value your feedback and more importantly they will use it to improve their service. Benchmark the standards that you expect from a delivery and then share it with your suppliers so that they know what your expectations are.
10. Pay your Suppliers on time.
    This might seem like an obvious one, but it is not very well adhered to. If you pay your suppliers within your agreed payment terms then they will supply to you on time as well. Importantly though if you pay on time and you have to process an emergency order then if your account is up to date, then will not have no problems filling your urgent order.

If you would like to clarify any of the points above, or would like to find out how Cross Docks Australia can assist in improving your ordering processes then please feel free to contact us at info@crossdocks.com.au or hit us up on Skout.

Try this simple exercise:

1. List the 5-10 activities that occupy your time on any average day. List everything from answer calls, deal with suppliers, manage staff etc.
2. Asign the average time that you spend on each activity
3. Add up the total number of hours in your average day
4. Add up the hours in each day that you spend generating new sales and growing your business.
5. Divide point 4 above by point 3 above.

If the answer you get is less than 0.70 or 70%, then guess what? You are not spending enough time growing your business and you are spending too much time on task that should be done by someone else in your organisation.

Now try another simple activity. Use the list that you generated in point 1 above and then work out which non revenue generating activities can be performed by someone else in your organisation. If you don’t have the right people in your organisation that can perform these tasks then contract them out to a specialist, like an accountant, book keeper, or an IT specialist.

Finally, and here’s the great bit. Add up all of the hours that you would have created by delegating these tasks to the people who can most likely perform them more effeciently than you. Divide the current number of hours that you were dedicating to growing your business by the number of hours that you have created. For example if you used to only spend 2 hours per day growing your business and you just created another 4 hours a day, then 2/4 = 2. This will be factor by which you will be able to increase your sales based on your past track history of hours converted to sales, i.e. 200% in this instance!!!

Sounds easy? Well it is really. The hardest thing is convincing yourself that there are often other people out there that can do these non revenue generating tasks better than you. Yes that’s right there are. And the beauty about that is once you recognise this then you will be able to grow your business.

A good friend of mine Joe Dorfman taught me this valuable lesson a number of years ago and I haven’t looked back. Here are his details if you are interested:

http://www.thepoweroffocus.com.au/

We could moan about and use it as an excuse as to why our businesses are performing badly or alternatively we could use it as a great way to improve the effeciencies in our businesses and enhane the service levels to our key clients and beyond!

Without pushing our own barrow too much I read an article in The Weekend Australian March 14-15 2009 titled “Others go to pieces as Lego builds a future” and it mentioned the following:

“The outsourcing of non-core activities and even sharing common facilities with other companies are also being adopted as prudent strategies.

“One businessman told of a group of manufacturing companies that re using the same warehouse space to reduce the cost of rent and maintenance.”

Personally I think that it is a fantastic idea. We recently finished renovating our house and stupidly I decided to manage the whole project and then do the bits that I could do… The end result is that we got it done and yes I saved some precious $$$ on the way, BUT along the way I took my eye off the ball at work, my family suffered and I moaned about my builder each night to my wife. The smarter alternative would have been to get my builder to manage everything from beginning to end and for me to keep out of his way. The job would have been done quicker, my family would not have suffered and just as importantly I probably would have use that time to work on my business!!! There is a common pearl of wisdom.

Don’t get stuck in the rut of thinking that you have to do everything yourself. Find a partner with a similar culture and a similar size and outsource your non-core activities to them. Then use the time that you have created to grow your business.

Food for thought any way.

Another good idea is either do a stock take once per month (quite time consuming), or pick 5 – 10 different products per month and do them instead (saves time). This way you will know where you are at.

For more tips on this arduous task visit our blog where we have already addressed this issue.