Jergens Industrial Supply’s user-friendly order replenishing button is becoming increasingly popular with the Ohio distributor’s customers who have installed the IoT devices. With more than 400 in operation, JIS is also gaining valuable insights from the growing number of transactions.
When MDM last checked in with Jergens Industrial Supply (JIS), a division of Jergens, Inc., the Cleveland-based distributor had five customers using its Wi-Fi enabled button-based ordering system, JIS Express. Now, roughly six months later, they’re up to 11 customer sites utilizing more than 400 buttons — 10 times the amount in the field last fall. Sales from the buttons have also increased just over 30% in that time, says Steve Valentine, inventory management solutions manager.
JIS’s rapid growth of its industry-leading IoT inventory management technology makes the company one of MDM’s 2019 Digital Innovator Award winners. The inaugural awards recognize 10 distributors that have leveraged technology to advance their operational excellence.
It hasn’t been difficult for JIS to manage such a fast pace of growth, thanks in large part to the ease of setup that’s involved in installing them, Valentine adds. “The buttons are so user-friendly,” he says. “For a lot of these customers, we’re already visiting them on a weekly basis, so we’re just planning into the schedule time to install the buttons for products that they want to add.”
Taylor Kanocz is an inventory management solutions representative at JIS who works with several customers who utilize the buttons in their businesses to process orders and keep the system running smoothly. Before a button is placed at a customer location, Kanocz and other inventory management solutions representatives work with the client to determine their usage trends, so that min/max ordering levels are automatically programmed into the button.
When a customer pushes a JIS Express button, the system registers one button push for the day (even if a customer presses it multiple times). Then, an email is sent to the customer where they will have the opportunity to add/remove/delete quantities of any item requested based on what they feel they truly need at that time. Next, they will approve their request. At that point, the information is sent to the inventory management solutions representative for processing. “It’s almost managed by itself,” Kanocz says, “so there really isn’t a lot of back and forth between me and the customers when it comes to button orders.”
While JIS has yet to bring in new customers based solely on its JIS Express button capability, Valentine says they’ve seen “a huge spike” in current customers expressing interest. Often, the process starts with the customer stating that they love the idea of the product but aren’t yet prepared for it, then several months later, they’ll reach back out to JIS and say that they’re ready.
The delay in implementation stems from a desire to become comfortable with the technology first — particularly to address security and vulnerability concerns that come naturally when considering any IoT application, Valentine explains. “They’re web-enabled buttons and that’s always a concern in the IT world,” he says. “We coach them and let them know that there’s no safety issues with these buttons in terms of their network and their domain.”
Often, a customer will become familiar with the product by trying out one or two buttons for a period of time until they feel comfortable with it, realize the ease of use and security of the system, and then request more. “That’s when we start to see the growth within those customers,” Valentine says. “They start to add more buttons, different types of products.”
When JIS first introduced the buttons, the goal was to make it easier for customers to re-stock items that don’t typically lend themselves to vending machines. Installation involves an approximately five-minute setup and configuration process for the buttons, with the cost per item for JIS coming in at approximately $20. Installing the buttons for clients started with customers wanting to use them for cleaning-related products (MRO), but over the last six months or so, has begun to migrate to other categories, such as coolants, metal-cutting blades and abrasives. “Those are the three big areas where we’ve seen gains inside our existing customer base,” says Neil Maniccia, general manager.
An overarching goal of the JIS Express button is to use the efficiency and streamlined process to emphasize the value JIS brings to its customers in order to expand the relationship with them, Maniccia adds. In an almost counterintuitive nature, because the buttons enable customers to interact with JIS less, they are becoming stickier clients. “That’s the direction that most companies in most industries are headed,” says Maniccia. “They’re looking to streamline their processes and improve cost efficiencies.”
But there’s also a certain level of comfort knowing that JIS is there, operating in the background any time they’re needed. “We’re offering a service that is not being offered by a lot of our local competitors in the area,” Maniccia adds.
Because JIS’s competitors are “just now scraping the surface of this technology,” JIS has the opportunity to expand its footprint for its existing customer base in a way that “makes it difficult for them to look elsewhere. Because if you’re going somewhere else right now, you’re going backward,” he says. “There’re no other competitors offering this service and I don’t see a lot of companies that are looking to go backward these days. So, with us being at the forefront in it, we’re really cementing ourselves in these companies with our vendor-managed inventory services.”
Looking to the future, JIS would like to continue bringing more buttons into existing customer businesses while also expanding to new clients. “Our next steps are to further penetrate an existing account and help streamline their processes, and also to develop new relationships using these techniques,” says Maniccia.
Each button has a green light that lights up when someone engages it by pressing on it, and lasts about 2,000 presses. As for the internal technology, the company works periodically on updates with MindHARBOR, the outside programming firm it partnered with to create the program over the course of eight to nine months in 2017. MindHARBOR has been around since 2000 and has worked with Epicor’s Prophet 21 ERP for distributors since 2007.
The buttons have a shelf life, and there are periodic product upgrades needed for their internal software, much like a Windows update, notes Valentine. “We work closely with MindHARBOR just to make sure that we have continued support, the product’s going to keep working,” he says.
As MindHARBOR’s Chief Operating Officer Mike Blasdell explained to MDM last fall, its application protocol interface (API) integrates with JIS’s ERP system. Whereas early versions could only order one product, it’s now open to including a growing variety of SKUs. “Early on, we figured out the best way for us to bring value in that community was to open the system up and find ways to help people get more out of P21 specifically,” Blasdell said. “We built an API so that we could open up software systems.”
While Amazon earlier this year retired its similar product for the consumer industry, the Dash button, the transformation to a virtual button Amazon is making is not likely to happen any time soon at JIS. The digitization “is a cool process but it doesn’t necessarily fit our business needs,” says Valentine. “Our customers inside of these facilities, they need a hard button to push. So, we’ve put our focus into improving our internal reporting with MindHARBOR and becoming experts on these buttons.”
Although it sounds like a simple process and JIS markets it to customers as such, the technology behind the buttons involves a lot of coding that needs to be maintained. “The software that helps operate these, navigated through the Epicor system, is run off of [AWS] Lambda functions and that’s where MindHARBOR is really helpful for us,” Valentine adds. “They’ve got a lot of great engineers and coders, and then they work through that with them, Amazon Web Services (AWS), and we work together to make sure we’re doing our upgrades properly.”
JIS does not offer data reporting that is generated from the button usage to the end customer, but the information has been “extremely useful” internally, says Valentine. “It allows us to see what buttons are actually being pushed out in the field, which ones are working for us, which ones are not, so we can get centrally focused with our sales staff to go drive that business and improve it, or see if there’s maybe another product or item we could add in its place,” he says.
The data also show JIS where its biggest gains are, whether its MRO products, coolant, metal-cutting blades or any type of product that is growing in popularity. “It gives us a vision of, ‘OK, this is where we need to push, this is where we’re seeing our most gains,’” Valentine says.
Having access to that real-time data is making JIS’s back-end inventory process more efficient, so that the company can stop carrying or reduce inventory of products that are moving slower, or order larger quantities of those that are flying off the shelves. Particularly for large purchases, where in the past they may not have hit certain purchasing order thresholds required for large purchases from manufacturers, now they can factor in buying quantities from small customers, that they couldn’t accurately track previously, and realize that they’ll be able to meet those purchasing thresholds in the future, Valentine explains. “It’s definitely helping our inventory and really giving us an idea on where we need to focus in the industry right now throughout our customer base, and then new customers that we’re seeking out,” he says.
“When we rolled these [buttons] out, we were excitedly curious. But now that we’re starting to get data back and we’ve grown to over 11 accounts and 400 buttons, it’s a lot of data we have available to look through,” Valentine adds. “So, you start seeing your increased buttons, your increased sales, and where those sales are going and what buttons are being pushed — which customers are searching to add more buttons. That allows us to zero-in on certain areas and product groups, and that’s helpful. And then, our sales staff is doing an amazing job out there in the field helping to grow that business.”
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