By Brian Albright, Field Technologies magazine
A pasta company expands business thanks to rugged mobile computers and an automated DSD (direct store delivery) application.
Growth is usually good for business, but for small companies, growth can sometimes present a resource challenge. Santa Cruz Pasta Factory discovered this when demand began outstripping the capabilities of its delivery fleet. The company deployed a rugged mobile computing solution to improve efficiency and expand its customer base without adding staff.
The family-run manufacturer of fresh pasta and sauces delivers its products direct to a number of grocery stores using a handful of delivery drivers. As the number of stores selling the company’s products increased, however, owner Steve Simonovich discovered inherent inefficiencies in Santa Cruz’s manual delivery and invoicing processes. “When we started growing, it became clear we couldn’t survive on handwritten invoices,” says Simonovich. “It took the drivers way too long to fill out the invoices, and it took our bookkeeper hours every week to input the invoices into QuickBooks.”
Simonovich was unable to
add new stores to his existing
routes, but didn't want to
take on the expense of buying
a new van and hiring an
additional driver just to bring
in new customers. Worse, the
delivery drivers (Simonovich
himself is frequently one of
them) would often make invoice errors in the field that
resulted in costly write-offs. "It's hard to be perfect at
five in the morning when you're trying to add up the
different pricing at different stores, and it's dark and
you're barely awake," Simonovich says. Those write-offs
added up to anywhere from $250 to $500 per
month, a significant cost in a low-margin industry.
Simonovich noticed that other vendors delivering
goods to his grocery customers did not have these
problems because they were using mobile computers
and bar code scanners during the delivery process.
"I knew we had to change the way we did business,"
Simonovich says. "When I would see other drivers out
at the stores, I'd ask them what devices they were using.
The one name that kept coming up was Intermec."
Simonovich contacted Intermec about their rugged
DSD solutions and attended one of the company's
symposiums. Representatives of the computer
manufacturer directed him to one of the company's
software partners, San Jose-based MSA Systems.
Initially, Simonovich wasn't sure his application
would be a fit with MSA. "I was really looking for a
small solution for three handhelds," he says. "MSA was
used to dealing with larger companies on a larger scale.
I had to talk them into doing this. But I told them that
there are a lot of people like me out there who are in
the same boat, who need this kind of solution."
Simonovich and MSA worked together to develop a
DSD system (based on MSA's QuickStock application)
that met the company's basic invoicing needs, but
that could be expanded later to accommodate more
functionality. "Their solutions revolve around inventory
management, and although that could be helpful
to me, it was more than I wanted to tackle at the
beginning," Simonovich says. "What I needed was a bar
code scanner and the ability to input individual pricing
for stores, print out invoices, and download all of that
data into QuickBooks. There were a lot of details about
credits and returns we needed to include, and I wanted
a platform that could expand as we grew."
Mobility Allows More Stops Per Driver
Delivery drivers make weekly stops at each grocery
store to take inventory, rotate stock, and invoice
customers. Each store stocks a different mix of Santa
Cruz's 26 products, and each customer has its own
pricing schedule. Creating invoices at each stop took
drivers about 20 minutes on average, depending on
Now, drivers are equipped with Intermec CN50
rugged PDAs and PB51 4-inch mobile receipt printers.
When they arrive at a store, the drivers check the shelf
for all expired product, scan the UPC code on the
items, and generate credits within the system. After
scanning the remaining items on the shelf, the drivers
check the par level (level of each item of your inventory
that you need on hand to make it to your next delivery)
for each store to see if more goods need to be stocked.
They go back to the truck, pull the inventory, and
restock the shelves, scanning the items as they go.
Once everything is stocked, the driver can print out
an invoice (adjusted for whatever credits the store is
due) and provide that to the shipping and receiving
department at the store. "Once they get back to our facility, they take the handheld and dock it, and it syncs
with the computer," Simonovich says. "Everything is
loaded right into QuickBooks."
Before, drivers manually wrote down all of the inventory
changes and then added up the credits for expired
product. "Every store might have 15 to 18 different
products, so the driver would have to come up with a
total for the credits and then do the same thing for the
billing on the fresh product," Simonovich says. "We went
from that process taking 20 minutes or more to creating
invoices in about 5 minutes with the new system."
In addition, the old carbon paper invoices cost 18
cents per sheet; now, the company spends fractions
of a penny to print each invoice. Invoicing errors
have been eliminated, saving Santa Cruz hundreds of
dollars in write-offs each month. "I can't emphasize
enough how eliminating those math errors has helped
us," Simonovich says. "If there was an error of $7, I
wasn't going to go through the hassle of contacting the
bookkeeper of a really busy store over that. I don't have
that kind of time, and they don't have that kind of time,
so we wrote it off. But we were writing off $50 or $100
a week like that, and it added up." Simonovich was
also able to add another three to four stores per route
without adding staff or new trucks.
Rugged Computing Vs. Consumer-Grade
Although the company briefly considered deploying
smartphones for the application, Simonovich says rugged
devices were a better choice because the computers
get dropped frequently, and they have to survive
the dusty environment of the pasta manufacturing
facility. The application also proved easy to use, and
training took only 30 minutes per driver.
Simonovich hopes to add more features to the
solution in the future. For example, drivers currently
have to check par levels for each store on a printed
Excel spreadsheet. "When there are changes to the
store levels, I have to go in and make them and
then print it out again," Simonovich says. "I want to
incorporate that into the handheld, so when we scan
an item it will tell us what the par level is."
That will add even more time savings to the
efficiencies the solution has already created. The
company is billing for exactly what it delivers, and
the bookkeeper has saved 6 to 8 hours of labor
per week since she doesn't have to manually enter
invoices into QuickBooks. "We also look more
professional in front of our customers," Simonovich
says. "And I've got the ability to expand the routes
as the business grows."