Case Study: Partnership
The Customer’s Struggles
The owner of a small e-commerce website was having difficulty keeping her inventories stocked. This well-educated doctor and driven entrepreneur had contracted with another manufacturer to produce and deliver her self-formulated products. Ten months had passed since she had placed a $35,000 down payment and order of product with her manufacturer, but the product she ordered and paid for still hadn’t been manufactured. Meanwhile, demand for her brand of ethnic personal care products had only increased, and customers were seeing an increasing number of stock-out notices on product pages. Shortly before contacting BPI Labs, stock-out warnings had developed site-wide, and in such a dire situation our customer had converted her own home into a provisional laboratory and processing area to fulfill customer orders.
BPI Labs’ Response
On February 12, 2012 BPI received a call from this entrepreneur, and with urgency, BPI set out to develop samples of her formulas for approval. First, BPI converted her formula processing instructions, which were optimized to work with household processing implements, into large-production processing instructions. Second, BPI worked with the entrepreneur to create thoroughgoing specifications for product design so that BPI could ensure quality control on all production. Finally, we expedited our order fulfillment process beyond our typical schedule to alleviate the back order situation. Within weeks her inventories began to fill and the stock-out warnings were soon removed from her website. This is where the story gets interesting.
This is where the story gets interesting.
Our Customer Contracts a Life Threatening Illness – Stockouts Loom
BPI’s client contracted a life-threatening illness and was admitted into the hospital for 5 – 6 months. Like many of our clients, our customer would order and forward all of the packaging she used for her products to BPI’s factory before production. But communication became difficult for her, consequently stock-outs were again threatening her company with losses and damaged reputation. Because of our client’s embattled condition BPI made the unprompted decision to streamline her product ordering process so she could continue to operate her business in her condition.
BPI proceeded to find materials suppliers for all of her materials, supplies, and packaging for her products, and then we negotiated lower prices resulting in an overall lower unit price for her products. BPI also located a product fulfillment house in nearby Salt Lake City that could receive her website orders and ship product to her customers. The fulfillment house would now alert BPI when inventory was low, and BPI would begin coordinating with materials suppliers to ship us the raw materials necessary to make her product and refill the fulfillment house. Our customer would only need to sign a purchase order to prevent stock outages.
Conclusion: BPI Labs Competes on Relationship
Today, after our client signs a purchase order, all raw materials and packaging are ordered, her product produced, and then delivered to the fulfillment center where orders from her website are fulfilled automatically. In spite of our client’s desperate plight, stock-outs will not threaten her company again, and moreover, her product has never been cheaper to produce. Even more, the client has had the thrilling opportunity to begin stocking a major, national, retail outlet with her products. Her formula designs and company’s marketing are owed the credit for the success of her products, but BPI Labs is honored to have had a role in her achievements.
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