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Nimble Supply Chains: Why Drop-Ship Changes Everything, and Nothing

Nimble Supply Chains: Why Drop-Ship Changes Everything, and Nothing. SOG 1.0. 2007 - 2011. 1986 - 2009. 2010 - Present . 2009 - 2012 . Who is SOG Today?. “ We don't settle for ordinary. We never did, and we never will. ” -- Spencer Frazer, Founder/Chief Designer.

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Nimble Supply Chains: Why Drop-Ship Changes Everything, and Nothing

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  1. Nimble Supply Chains:Why Drop-Ship Changes Everything, and Nothing

  2. SOG 1.0 2007 - 2011 1986 - 2009 2010 - Present 2009 - 2012

  3. Who is SOG Today? “We don't settle for ordinary. We never did, and we never will.”-- Spencer Frazer, Founder/Chief Designer “We don't settle for ordinary. We never did, and we never will.”-- Spencer Frazer, Founder/Chief Designer “We don't settle for ordinary. We never did, and we never will.”-- Spencer Frazer, Founder/Chief Designer

  4. Roadmap to Success • Company Sold In 2009 to Private Capital Group • GOAL – DOUBLE SOG IN 2 YEARS!!! • Develop Growth Support Plan • Hire VP of Retail Sales • Hire eCommerce-focused Rep Agency • Build Brand Recognition • Leverage Existing Relationships with Big Box Retailers • Build Drop Ship and eCommerce Channel

  5. Dive Into E-Commerce Are Drop Ship and eCommerce a Necessary Evil?

  6. New SOG Emerges • Economic Impact Clear • 2 Consecutive Years of Huge Growth = 40% each • Knife Industry Annual Growth Average = 8% • Reactive Versus Proactive • E-Commerce proves SKU demand • SKU Placement At Retail Expands Rapidly

  7. Dive into Drop Ship • Costco.com and Target.com • Drop Ship model only • No Inventory • Branded Consumer Experience • Order Processing Volume More Than Doubled • Hundred of Orders Received Each Weekend • Drop Shipping IS A Necessary Evil!!!

  8. But …

  9. Black Friday & Cyber Monday • Increased direct-to-consumer orders of 650% • Weekend Orders In The Hundreds • OOS On Top Selling Items • Low Fill Rate at 70% • Order Turnaround Was 5+ Days • DISAPPOINTED CUSTOMERS AND BUYERS • Best Holiday Season Ever

  10. SOG 2.0 • Overhaul To Supply Chain • Supplier Diversification • Lean Implementation • Improved Forecasting Efforts • Created Early-Stage SIOP Process • Key Account Analysis • Annual Purchase Order Volume = 30,000

  11. SOG 3.0 • Same Day Order Processing • Continued Process Improvement • Advanced Forecasting Methods • SIOP and SKU Rationalization • POS Analysis (TPI by SPS) • New Product Development Gate Stage Process • Annual Purchase Order Volume = 60,000

  12. Overcoming Obstacles • Seasonality • Q4 – Christmas • Fall – Hunting • Spring/Summer – Outdoors • Winter – New Product Launch • Chinese New Year • Asian Supplier Holiday • Nothing In or Out • Efforts Spent On Improving Business Processes • IT Improvements • Staff Training Sessions • Marketing Efforts • New Product Development

  13. Integration Story • BETA Participant with VSync (Accellos) and SPS • Began Testing In July • 14 Out Of 45 EDI Partners Already Integrated • Integrated Trading Documents Include: • Purchase Orders • Functional Acknowledgements • Advance Ship Notices • UCC-128 Labels • Custom Packing Slips • Invoices

  14. EDI Transactions

  15. VSync and SPS • Previous Solution Took 6 to 12 Months • Currently Integrating 3 or 4 Partners Every 2 Weeks • 30,000 Touchpoints Eliminated Through Q4 • Annual Savings = $50,000 (Estimated) • Eliminates 50 hrs/week Order Processing Time • Additional Benefits: • Increases Margins • Increases Accuracy • Decreases Order to Ship Time • Decreases Customer Status Checks • Reduced O/T Costs During Peak Times

  16. Thank You. How To Reach Me… Tanya Tremoulet P. 425.361.4602 C. 425.248.1893 E. tanyatremoulet@sogknives.com

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