Ordering goods over the Web may sound like the most common of all eCommerce requirements, but when your business model doesn't quite fit the standard B2B or B2C mold, the efficiencies and benefits that online orders may offer can be greatly diminished by the lack of control and flexibility that come with a hosted out-of-the-box Web solution.
ITWAL, Canada's national network of independent distributors, replaced a hosted shared code eCommerce system with a custom-developed online order solution. Being in control of its online order platform has allowed ITWAL to deliver focused functionality to its members, better alignment with its internal procedures and additional services to its suppliers.
ITWAL Limited, based in Ontario, Canada, was founded in 1966 by a small group of independent wholesale distributors, who were mostly active in the confectionery and tobacco sectors. They formed ITWAL to combine their collective buying power, thereby enabling them to compete effectively for the benefit of their customers. Since those early days, ITWAL has evolved into a national distribution network of wholesale distributor members, offering a wide assortment of grocery and foodservice products, and operating 149 warehouses across Canada.
Large retail chains usually have no problem ordering a truckload full of, for example, chocolate bars from a supplier. But for the smaller independent distributors and retailers, such a load is usually more than they need. By consolidating the orders of its member distributors, many of whom serve Canada's rural areas, ITWAL can offer economy of scale and supply chain efficiency to both member distributors and suppliers, while benefiting from large volume buying. Additionally ITWAL offers its members specials and deals that are exclusively available to them.
Large volume members may have their goods shipped directly, but most of the consolidated orders get shipped through ITWAL's 250,000 square feet warehouse in Brampton, Ontario or through a similar 300,000 square feet facility in Montreal, operated by its Quebec members under the Groupe Colabor.
"There are many elements in play that help us reduce the cost of getting goods to market. This makes it possible for consumers in rural areas to buy their goods at a similar price to what other people pay in metropolitan areas," summarizes Tom Mavroidis, president of NTM Consulting, on who ITWAL relies for its IT management.
Virtually all of ITWAL's IT systems are in-house developed COBOL or RPG applications, or totally customized versions of code that may have their roots from a custom package. ITWAL’s systems can be traced back to the days of the IBM System/3, which was replaced by a System/34 in the early eighties. ITWAL skipped the System/36 and System/38 and went straight to the AS/400 in 1988. Although a true blue shop, several Linux and Windows servers have been added over the years.
Simplified for ease of explanation, ITWAL's IT systems evolve around suppliers and member distributors. Suppliers provide their product and pricing information, which is made available to distributors to place their orders against. ITWAL then consolidates these individual orders and either fills the orders from its warehouse, or places an order with the respective supplier. In addition, ITWAL organizes a 'MarketPlace' show once a year, the largest trade show of its kind in Canada, where suppliers can showcase their products directly to ITWAL's distributors and offer trade show specials.
The backend system includes many order types (more about those later). The standard warehouse orders are handled by a Linux-based eCommerce system that NTM Consulting designed and implemented some 15 years ago. It involves a Windows component on the distributor's client PC that allows the secure encrypted exchange of information, of which the Linux system exchanges with ITWAL's IBM i. Until recently, the majority of the special order types were handled through a hosted eCommerce solution that ITWAL subscribed to four years ago.
The hosted solution handled the job, but wasn't very well suited to ITWAL or its distributors. "Most of the solution's functionality wasn't relevant to our business," explains Mavroidis. "As a result screens were cluttered with irrelevant menu options, fields and other information. Also, changes that were made for other users rarely benefited us, but since it was a shared code base, we still had to go through the upgrade process. Occasionally upgrades would cause down time and introduce errors."
Most of the hosted solution's functionality wasn't relevant to our business
Only Four Months To Go
ITWAL decided to re-evaluate using the third party system for its members and investigate alternatives. "We had two options," says Mavroidis. "One was to go back to the fax/email system that we had in place before we started using the hosted platform. The other option was to develop a suitable Web solution ourselves. Reverting back would mean letting our distributors down, so we had to move forward. When management approached me to look for alternatives, it was late September 2010. The next ITWAL Marketplace show was taking place in March, giving us only four months to develop a workable solution, an almost impossible task because of the scope of the project."
"At first I considered handling the project in-house, but I quickly put that idea to rest since ITWAL did not have the right resources or skill-set," continues Mavroidis. "Next I looked at bringing in additional NTM resources, but everyone was committed to other projects and it would have disrupted their schedule. A third option was to source external contractors that we had no history with, but that was too risky for such a short turnaround time. Moreover, recruiting and managing individual contractors would become very time consuming and limiting and would take away from the day to day operations."
"Then I remembered LANSA. I had approached them several years prior when I was researching technology options for a different development plan. Back then other priorities took precedence and nothing ever transpired with the grand plan, but I was left with an extremely positive impression of LANSA’s ability to bring a project to fruition. I knew LANSA could deliver on time and on budget. It has the services and the tools to support the project completely. During my original discovery phase I had spoken with some of LANSA's active customers and they spoke admirably about them. Another benefit to us was the availability of local support in Mississauga. Even though technology allows us to work remotely, it’s always comforting to know that you can have a visit from your developers within a half hours drive. With all these benefits it was an easy decision to recommend LANSA as a strong company to partner with. ITWAL decided to give it a try."
LANSA has the services and the tools to support the project completely
The first project scope meeting for the new ICON (ITWAL Custom Ordering Network) system was held in mid-October 2010. Because both time and budget were limited, Mavroidis decided to limit the number of order types ICON would handle to the most important ones (at least for stage one). Those were the Marketplace orders, that are shipped through the ITWAL warehouse and Controlled Distribution orders, such as Limited Editions, New Products, Product Clearouts, Promo Select, Seasonal and more.
Mavroidis also decided to develop the reports with ITWAL's own IT team and let the LANSA Professional Services consultants work solely on Web development. His reasoning being, "The moment a user receives a new report, there are always many requests for changes and additions. I didn't want us to be at risk of blowing our budget on reporting. Also, reporting is best handled on location where you can get instant feedback from users."
Mavroidis and two other members of the IT team attended LANSA's class room training so they could learn to use the products and eventually maintain the code base themselves. Even so, they would occasionally hit a sticking point during the project development. In those situations they found it very convenient to use LANSA's remote mentoring assistance. "It's good to know that someone is available to walk you through a problem when you are stuck on an issue. I'd much rather make a quick call to a mentor instead of spending hours, or even days, having programmers digging through pages of documentation. It is money well spent. Since time is precious and un-renewable, mentoring support is just one of the many advantages of using LANSA."
"Also, from a contingency planning point of view, it's comforting to know that there is a large group of programmers worldwide at LANSA that we can depend on if the need arises. Everyone from LANSA who worked on the project was very professional and disciplined. A quite refreshing change from the many technical hobbyists who seem to have moved into the computing industry over the last decade or so claiming to be developers."
The project proceeded smoothly and in January, two and a half months after the project started, the Web order site was rolled out to a small group of pilot users, soon followed by the full rollout. "It was because of the commitment and dedication of the whole team at both ITWAL and LANSA that this project was as successful as it was," says Mavroidis.
Two and a half months after the project started, the site was rolled out to a pilot group of users
"Now the solution is completely under ITWAL’s control and its focused functionality targets directly what it is that the members need to do to place an order," continues Mavroidis. "The screens aren't cluttered with irrelevant information and the whole solution flows a lot nicer than before. ICON is one of the most frequently used applications by our member distributors and the labor savings are significant. Our members have nothing but praise for the new system."
Annè Nielsen, Marketing & Communications Manager at ITWAL, agrees. "The ICON solution is very efficient and completely tailored to our members. It takes just a few clicks for them to place an order."
"Another major efficiency for the distributors is that they now have better visibility of all the suppliers offerings within an order type, for example 'New Products'. Previously they would have to select one supplier at a time," says Nielsen.
ITWAL is also achieving internal efficiencies because it can align the ICON order platform with its internal procedures. For example, the product information that a supplier provides is published with a consistent layout both on the ICON Web site and in the warehouse notes. Previously there were inconsistencies that could cause confusion.
Because of ICON's tight integration with ITWAL's IBM i back-end system, the entire ordering process is more transparent for the distributors.
ITWAL's suppliers are excited about ICON as well, because they have improved visibility within the supply chain, all the way down to the details of the individual orders for their goods placed by ITWAL's members. Knowing who is buying what allows suppliers to better target their sales and marketing efforts. In addition, suppliers have the opportunity to advertise on ICON.
The solution is completely under our control and its focused functionality targets directly what our members need
Mavroidis considers the implementation of ICON phase one a tremendous success. "The definition of what was required was spec'd out well, in all its nuances. Everyone did their part and it all worked well. What was promised was delivered, on time and within the budget. We didn't have any difficulties whatsoever," he says. "Phase two of ICON is in planning and likely to handle additional order types and provide portal access to suppliers."
"There is so much variety of technology out there, that it sometimes isn't clear what it is we should be concentrating on and what not. With LANSA we now have our own practical and extendable platform on which to build and further grow ITWAL's business. We are making real gains in delivering Web solutions to our partners ourselves."
With LANSA we now have our own practical and extendable platform on which to build and further grow our business
Company and System Information
- ITWAL is Canada's largest national network of independent distributors, providing suppliers with innovative and measurable distribution, marketing, selling and information solutions. For more information visit: www.itwal.com
- ITWAL recently upgraded to an IBM i Power 5 server Model 8203.
- Toronto based NTM Consulting provides a wide range of IT services. For more information visit: www.ntm.net