Software Knowing When to Upgrade
Sovietski currently uses the Mail Order Manager system. While the system has served the company well and is capable of processing a high volume of orders and providing marketing data, Siegler is now looking for a system that will make it easier to extract more management and marketing information.
"As companies reach a certain level (in terms of revenues, number of orders, etc.), the requirements for information and reporting increase, and a more robust system is required to meet [these needs]," he says.
Sovietski has conducted preliminary evaluations of several systems. "All are extremely expensive (several hundred thousand dollars) and most are not terribly flexible, which is the No. 1 consideration for us." Siegler reveals.
To help it make a selection, Sovietski is seriously considering beta-testing a new product that appears to be substantially less expensive and quite a bit more flexible. Siegler says he hopes to resolve this issue by summer.
Another catalog marketer faced a different set of challenges: capacity and complexity. After Venus Swimwear purchased WinterSilks in 1999, it became clear that the company had outgrown its fulfillment software. Orders for both catalogs could be fulfilled from the company's 165,000-square-foot distribution center. What changed was the level of detail the software system that runs the warehouse had to manage, says Scott.
The key indicator that it was time to upgrade was that the cost per order (CPO) had significantly increased since the acquisition. "We had acquired WinterSilks and with it came the requirements associated with keeping inventory and fulfilling orders," Scott explains. "Suddenly, we had a much more complex fulfillment operation. Our CPO was going up when it should have been going down due to economies of scale."
Instead of purchasing an entirely new system, Scott went to his current software vendor, Phoenix Systems Group, for advice. Phoenix had a module solution that could be purchased. They arranged for a site visit so that the team involved in the purchase, including Scott, Operations Vice President Elisa Lowry and Fulfillment Manager Ken Thorpe, could see the system in use.