As the building industry’s infrastructure matures, it will evolve from pen-and-paper workflows to ever-connected mobile eCommerce. Incorporating technology, new talents, and the speed of adoption can dictate a company’s success or failure as it will be a competitive advantage for early adopters.
Executives need information faster than ever to make better and more profitable business decisions, especially in light of the wild volatility and high prices we’ve seen over the last eighteen months. No longer can the building materials industry rely on operating only during traditional working hours and using dated subject prior pricing. Digital transformation is an ongoing process, and digitizing your internal operations is a leap forward in the race to success.
Growth is constrained today by a few key factors: access to or cost of credit facilities, number of staff or amount of time in the day, number of customers or the ability to service them and the time it takes to complete key tasks like writing up a sales order. Let’s address these one at a time and see how digital platforms reduce and or remove these constraints.
Reducing the Cost of Credit
Access to and cost of credit facilities is limited by the bank’s underwriting policies and structure. A good portion of this underwriting is to mitigate perceived risk due to a lack of confidence in the visibility of the business. With real-time reporting, better visibility into inventory age, inventory turns, customer credit management, and the current market prices, a digital operating platform like BuyChain can reduce a bank’s risk in underwriting and therefore increase borrowing power as well as reduce the cost of credit.
Removing Human Constraints
With a digital operations platform, growth is no longer limited by the number of staff. The power and efficiency of these applications will substantially increase the capacity of your people so they can get far more done in the same amount of time. For example, with BuyChain a salesperson could be taking an order over the phone and chatting with another customer in the application, while another two customers are buying through the system. This means the salesperson is completing four orders simultaneously. Think of all the time savings if you didn’t have to spend time quoting current market prices and only answered calls with POs! Industries that have adopted digital supply chains and modern operations platforms have shown a dynamic increase in revenue with very small teams. With current talent shortages across the industry, there could not be a better time to adopt digital operations tools.
The power of these modern operations tools is in providing the ability for customer self-service. This enables your customers to access the information they need at their discretion. Think of how much time it takes today to trace railcars, determine if a truck has shipped, quote products in delivered prices, and share available inventory. Think of the percentage of your day your team spends just chasing down an answer that lives in one system or another for a customer. Now think about all of that going away, since it all lives in the application you can give them access to. Think of how many new customers you could handle if the majority of those interactions were now done directly through your customer portal.
Digital self-service capability makes almost everything faster, giving your staff hours of their day back. While we were developing BuyChain, we constantly tested our application against the current tools in the industry so we could find ties, savings, and intuitive automation for repetitive tasks. The nature of a transactional business model such as in the building materials space means there are tasks and activities that repeat day in and day out. With the power of automation and machine learning, you can speed this up substantially with intelligent shortcuts—or in some cases automate altogether. We discovered that BuyChain is not marginally faster—it’s five or ten times faster, and we believe there is even more we can do.
Let me share a practical example of how this works. Let’s take a simple sales order, something that your teams likely do hundreds of times a week. A customer calls and needs a truck of 7/16 OSB at his Baltimore store. While on the phone, you click on inventory, select the customer and the Baltimore location, and instantly the inventory changes to show all in delivered terms. Next, you select a truck of 7/16 OSB, the customer agrees on a price, the system provides a PO ready for your input—you hit enter, and you’re done. Behind the scenes, the system has removed those units from your inventory. It has added all shipping details, contact information, and created an order confirmation that is emailed to the customer. The system has also added those units to your customers’ inventory as “On Order.” It’s sent a notification to your logistics department to schedule a truck and has created a pick ticket. To put in context how fast this process is, it’s . . . wait for it . . . 29 seconds.
Now try this test:
- Start a timer.
- Log into your system.
- Open your inventory.
- Pick a product.
- Find a delivered price to a nearby city.
- Write up a full truck of that product to your favorite customer.
- Remove the product from inventory if not automatically done.
- Complete the order.
- Send the pick ticket (to yourself).
- Send the order confirmation (to yourself).
- Stop the timer
- Take your time and convert it to seconds.
- Take this number and subtract 29 seconds
- Multiply this number by the average monthly transactions your company does.
- Take this number and divide it by 60 to get the number of hours.
- Take the hourly number and multiple by your sales admin or operations hourly wage.
This is how much BuyChain can save you in order writing alone every month!