Magazine Article | March 17, 2014

Mobile Payments & Inventory Management Deliver Customer Loyalty

By Brian Albright, Business Solutions magazine

This ISV has achieved double-digit growth by staying on top of its delivery company clients’ needs for mobile payments and improved on-shelf forecasting.

Software vendor bMobile Route Software has achieved doubledigit growth for the past several years through a laser focus on its core market — anyone who puts things in a truck and delivers them, from auto parts and prepaid phone cards to bread, beer, and snacks — and consistently innovating in ways that serve the evolving needs of its clients.

The company grew out of an ERP (enterprise resource planning) resellership in 1998, in response to a client looking for a custom route distribution application. Since then, the firm has grown to 17 employees and 250 installed clients.

The key: always keeping their clients’ overarching business needs in mind. “The goal for delivery companies is to ensure they have enough product on the shelf to never run empty, because if they do run out, customers are going to try a competitor’s product,” says president Chris Macaw. “On the other hand, they don’t want to have too much on the shelf so that they run stale and have to throw away product.”

That ability to accurately manage shelf inventory is especially critical in the bakery industry, a market where bMobile has focused a significant amount of its attention lately. In fact, the company has developed an algorithm that can perform forecasting and predictive ordering based on historical sales data, allowing customers to know what they should expect to deliver to a given location, and the level of stales they should expect for any period of time. “By weaving that data from many routes together, you can then forecast how much bread you need to bake to fulfill requirements for any period,” Macaw says.

“The holy grail is walking into a store and seeing one item left,” adds Jeremy Russell, director of sales. “That means you had just enough to not run out. The food industry is really one giant consignment model. If bread goes stale, you guarantee that the product will be taken back. That’s why the forecasting component is so critical. It’s the bakery’s product on the shelf.”

Another nascent market opportunity that bMobile has identified is home delivery, specifically home delivery of specialty or organic grocery items like milk, meat, and vegetables. “This is a little different from our traditional model, because it’s primarily business to consumer,” Russell says. “We’re working with a milk company, for example, and their customers can self-manage deliveries on their website. I know that sounds very old-school in a way, because the milkman is literally coming and dropping milk on the porch at night, but these companies are getting organized and there’s a growing specialty artisan market. These customers want to be the rolling Whole Foods or Trader Joe’s.”

Credit card processing in this case is a key differentiator for bMobile. “One of the largest needs of the home delivery market is that they will deliver today, and charge your credit card that night based on what they actually delivered,” Russell says. “Or someone might see their truck, and might come out and buy something on the spot. So they have to be able swipe credit cards in the field.”

Mobile payments have become important for delivery verticals because of the nature of the business for many companies, particularly those that deliver food or beverages to restaurants or small businesses. “Some of our clients’ customers are a credit risk, and AR credit control is paramount to the success of any wholesale distributor,” Macaw says. “It’s very important for our clients to maintain a good relationship with their customers, and to be able to extend credit with confidence. bMobile allows them to take credit card payment in the field, and also allows them to securely hold a token of the credit card for recurring transactions that are PCI compliant.”

That helps clean up the accounts-receivable challenges many delivery companies face. “They don’t really have to have receivables,” Macaw says. “If the customer’s credit card doesn’t process at the end of the day, then the office and the driver are alerted not to deliver to that customer, or to have the customer service rep call on them.”

Mix Of Hardware Appeals To New Clients
bMobile works with a wide variety of clients, from small delivery operations to large beer distributors, and the sales process is different in each case. For smaller companies operating fleets of one to 15 delivery trucks, they deal directly with the business owner. At larger companies, the vice president of operations or vice president of sales will be the key contact. “At that level, delivery is really a sales game,” Jeremy says. “It’s all about delivering product and servicing those clients.”

Sales cycles vary depending on the need the company sees for the technology. For companies that are still using manual, paper-based processes, the cycle is relatively short because the benefits are so obvious. “And it’s possible to use a mobile device now that won’t break the bank,” Jeremy says. “You used to have to pay $2,000 for a mobile device, but now you can deploy the same application on a phone for $150. They see a huge value there as long as they are careful with the devices.”

bMobile has expanded its mobile offerings beyond traditional rugged devices, and now offers a suite of Android applications that can run on tablets and phones, in part because it opens potential business with smaller clients that can’t necessarily afford more rugged hardware.

Subscribe to Business Solutions magazineFor companies with legacy applications, the sales cycle will vary based on the condition of the existing solution. “If the system is on the brink of crashing, the sales cycle is short,” Russell says. “In others, they may hold off until the hardware is obsolete or their equipment lease is up.”

In either case, delivery companies are sold on these systems because they save time and eliminate errors, particularly for companies that still rely on paper. “If they are handwriting invoices, they may need to add up to 50 to 100 line items per stop,” Russell says. “That creates a lot of calculation issues, and they don’t look very professional doing that at a customer location. Once that paper leaves the driver, it lands back in the office and someone has to key-enter it into the main business systems. Typically, we want to see one to two hours of gain for the driver, and an hour of gain for the back office staff.”

These companies want to improve driver productivity, reduce back office processing, and ensure that potential sales aren’t being lost. “How do I make sure the driver isn’t missing things the client normally buys from me?” Jeremy says. “Our customers want to make sure their drivers are filling the entire shelf and not leaving anything off that order. Automation makes that possible.”

bMobile also includes functionality in the system that can accommodate contract drivers or independent operators, a structure that is becoming more common with more delivery companies. “We can track independent operators using a few different business models,” Macaw says. “In some cases, they buy the product from the wholesale distributor and then do the deliveries; in other models, the product is consigned to them and commission is applied to the independent operator. We can seamlessly integrate those different models into the solution because the functionality is already embedded.”

Don’t Limit Yourself To The Delivery Truck
Increasingly, bMobile has found that its clients need the functionality of the solution to extend beyond the delivery truck or the back office. There is a growing need for e-commerce functionality, which allows the delivery company’s customers to place orders online prior to delivery. All aspects of the ordering process and delivery process, along with payment processing, need to work in close concert to ensure the orders are accurate and delivered on time.

bMobile worked closely with payment processor Merchant Warehouse, and has integrated its payment handling functionality within its own applications to make that happen. bMobile offers Web hosting services and an e-commerce platform so that customers can synchronize inventory and product information, and download orders from the website into the route accounting system.

Doing so can save clients valuable time in the field. Instead of fielding a call or surveying a customer onsite, a restaurant could place a late-night order based on what they have on hand and what they’ve sold the previous day. “You can just make the delivery the next day without any manual interaction,” Macaw says. “Since Merchant Warehouse has credit card authorization on the website, we can process the credit card when the shopping cart is processed or when the delivery occurs.”

Address The Entire Ordering Process
When it comes to satisfying customers with route accounting needs, the mistake Russell and Macaw see many generalist VARs making is trying to fit a square peg into a round hole. If your customer needs a delivery application, give them one, or partner with a software provider who can. “Many times, resellers will come to us after they’ve failed to get an ERP solution to address the specific needs of route accounting for wholesale distributors,” Macaw says. “If you have a customer with true route needs, then look for an actual route accounting solution.”

Macaw adds that those solutions must address the entire ordering and delivery process in order to provide the benefits these companies are looking for. “We really believe that there are three ‘operational hubs’ in each of these companies,” Macaw says. “There are the office personnel, the drivers, and the executive management team, which is getting its own set of reports. A system like ours services all three of those hubs by improving efficiency and accuracy for the drivers, eliminating extra work in the back office, and giving management the visibility it needs into sales performance.