When the outbreak of Covid-19 brought some unprecedented challenges to the businesses in the form of countrywide lockdowns and increased social distancing, like many offline businesses, Finagle Lanka, one of Sri Lanka’s leading bakery products manufacturers and distributors, found their offline sales and distribution channels severely restricted. At the same time, they wanted to execute their long-shelved plans to take their retail operations online too. They began mulling over a good solution. Their search for a viable solution brought them vis a vis ShopOnCloud, an eCommerce Solution that seemed strongly positioned to address their operational concerns. The dynamic collaboration between Finagle Lanka and ShopOnCloud brought the Finagle Online Shop to life. Here, we’re going to explore the events that led to the launch of Finagle Lanka’s online store and how we planned to solve their problems and address their concerns.
The Industry - Confectionery & Bakery Industry
Finagle Lanka Pvt Ltd operates in the confectionery and bakery industry. It’s an economically important industry given the fact that in 2017, Sri Lanka’s biscuit consumption was 18000 Mt. and the domestic market was worth Rs. 36 billion. Throw in all the other confectionery and baked items and the market value must be much larger than that.
The Client - Finagle Lanka Pvt Ltd
Finagle Lanka (Pvt.) Ltd. is in the business of manufacturing and distributing baked products. The company’s product portfolio includes Bread, Buns, Burgers, Cakes, Cookies, and varieties of Frozen and Par-Baked products. The company supplies products to Dine More and international clients such as KFC, TGIF, and Burger King. Apart from such international fast-food franchises, the company supplies their products to Hotels, Restaurants, Hospitals, and all leading Supermarkets and Groceries around the country.
Finagle Lanka, a manufacturer, and wholesaler of baked and confectionery items distribute their products to a network of distributors that distribute them in turn among the retail outlets from big supermarkets to small shops selling snacks and everything in between. They wanted to go into eCommerce to make up for the loss of sales on the offline channels over the pandemic and also expand their sales operations with an online storefront. They would want it for their entire distributor network to ensure the maximum convenience for the retail customers and accordingly boost the sales
The Industry Challenges
The confectionery and bakery products are perishable. Each item has a different expiration date or a best-before-date for consumption. So, the more quickly they can be sold, the better. When baked products are sold online, this fact has to be borne in mind. This calls for flash sales or special discounts for stock clearance purposes.
The Challenges Faced by the Client
The outbreak of Covid-19 and the concomitant public health regulations severely disrupted retail distribution. What happened was most of the retail outlets were temporarily closed and only the outlets operated by major supermarket chains remained open. But, even those big supermarket chains didn’t have a proper online sales operation during the first wave of the pandemic; the online sales mechanisms they managed to put together in a hurry came up short on consumer expectations due to lack of efficiency and problems in order fulfillment. Also, they barely took baked and confectionery products into consideration. Lower sales would lead to lower revenue and lower revenue to lower profits.
On top of that, the baked and confectionery items have a very short shelf-life, so the fewer outlets that bought those products for reselling bought a very limited stock to avoid the buildup of an inventory of unsold products. This lowered the sales even further and also revenue as a consequence.
On the other hand, as an exporter too, Finagle Lanka enjoyed the opportunity to continue its manufacturing operations without interruption. They had invested heavily in the plant and machinery as well in a fleet of vehicles for distribution. Thus, all the operations ran smoothly and all the logistics were in place too. It’d be a real waste if their assets had to sit idle just because the distribution of their products was hampered. All they lack was an online sales operation.
The company wanted to scale their operations seamlessly by operating an online store; for that, it wanted to add a centrally managed but semi-autonomous order management system for each distributor; here each distributor would handle the online sales of the Finagle Lanka products which the client could oversee in real-time. Here they confronted a major challenge. Even if they could find enough eCommerce Solutions that would give them an online shop with seamless scalability, few of them could accommodate a solution for a whole distributor network where each distributor could manage their online sales operations semi-autonomously with an online order management system also controlled by Finagle Lanka at the centre. They needed a centralised control because they wanted to manage distributors' sales operations in real-time and generate summary reports on sales performance so that they could determine with reasonable accuracy which stocks needed to be replenished and when and how many items and make more accurate forecasts on the demand and the inventory turnover. Also, the solution would have to allow a separate operational space for each distributor to avoid any potential disputes among them over the sales territory allocated to each.
Having gathered the client’s specific requirements and analyzed them in the minutest detail, ShopOnCloud drew up plans for this customized eCommerce solution. The solution involved making some custom developments to the SoC online ordering system to accommodate semi-autonomous operations for the distributor network. Accordingly, ShopOnCloud configured and integrated 17 online outlets for their distributors. The developed system is flexible enough to accommodate the configuration and integration of more online outlets as the client goes on expanding their offline retail network. On the storefront, both end consumers and resellers would place their orders online and have them delivered CoD (Cash on Delivery) by the distributor nearest to their location.
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