All The Right Tools

To thine own customers be true, and because Northern Tool & Equipment does extensive consumer research it is indeed true to its customers. The contractor supplies retailer knows who its customers are and what is important to them. After years of working with contractors, handymen and do-it-yourselfers, Northern Tool & Equipment is keenly aware that customer service, specifically help with making buying decisions, and speed and convenience of delivery (and when needed returns) are of utmost importance to its customers, and it works hard to continually and consistently deliver the best of both.

A smooth relationship between executive management and the IT department is essential to the company's ability to deliver both excellent customer service and speedy transactions. The mission of Northern Tool & Equipment's IT department "is to support the business units with applications or technologies that allow them to improve the customer shopping experience," says Todd Wermerson, vice president of IT at Northern Tool & Equipment. "IT is well aligned with the business units. I am in all of the senior staff meetings so I understand the direction of the company and all the issues and concerns."

Recent issues and concerns have revolved around the perennial needs of Northern's customers. Customer research, says Wermerson, indicates that "our customers very much appreciate knowledgeable sales people." In addition, because so many of Northern's customers are handymen and contractors, they don't have a lot of time to spend at the store searching for the right item. Nor do they have time to wait for delivery or to go out of their way to return an item. With these needs in mind, Northern Tool recently developed several new IT projects designed to expand and extend the reachability of the company's knowledge to make the purchase, delivery 'and returns processes as easy and fast as possible.

WAREHOUSE ACCESS
A fair amount of products at Northern Tool & Equipment are sold exclusively through the company's catalog or Web site, and delivered via a warehouse or distribution center. Such products include items too large to display in stores and include a large selection of agricultural and ground maintenance equipment. In order to speed up the ordering process, Northern implemented the Total Warehouse Access program which enables customers to order these products in the store and have the delivered, free of charge, directly to the store for pickup.

Powered by the Epicor | CRS Enterprise Sellingplatform, as well as the J.D. Edwards ERP application, Total Warehouse Access "is geared toward any of our customers who want products that aren't available at the store but are available in our DCs," Wermerson says. And there is definitely a demand forthe service. Before the system was deployed in the stores, direct warehouse orders accounted for approximately $10 million in sales. Since Total Warehouse Access was implemented the company now does closer to $22 million in direct warehouse to store sales. "We think it could go to $40 million."

Prior to the implementation direct warehouse orders were cumbersome, slow and often led to lost sales. One method of direct warehouse orders was to "direct customers to call our toll-free phone centerand place the order just like any other catalog order," Wermerson says. "The problem was the customer could leave the store and not call the order in, thus we would lose the sale." The other option was for store managers to hand write orders and then fax them to the call center. "Again, this was not very convenient for our customers and also could delay the order a day or two."

Now the customer just goes through the normalcheckout process and the order is transmitted directly from the POS to the order entry system. Total Warehouse Access has increased the speed of delivery by approximately two days, allowing customers to get merchandise to work sites much quicker. "This process is extremely convenient to our customers and at the same time allows us to close more sales," Wermerson adds.

ACCESS ACROSS CHANNELS
With the foundations of the total access system laid, Northern Tool & Equipment is now turning its attention to ways to expand access across all its channels. "Channel integration is one of our topstrategic goals," Wermerson says. The advantage of a seamless cross-channel retail business is that "you are using all of your inventory and a customer can buy what they need through any channel. He can return it to any channel. We aren't saying to the customer you can only do this here and this there."

One of the first cross-channel functionalities Northern will deploy is the extension of the Total Warehouse Access system to the company's Web site. This will enable customers to order warehouse items online and pick them up at the store. As of now, delivery of online orders is direct to the customer.

Also on the front-burner is a merge of the three separate channel transaction databases (mail order, ecommerce, instore) into one database, so sales associates and management have one view of all transactions. With a unified transactions database phone representatives will be able to process returns for customers who purchased items in store. Or conversely, instore sales associates will be able to accept a return for an item that was bought online.

Improvements to the returns management system already are underway, though not yet on a cross-channel basis. The initial phase of returns management currently being implemented allows customers to return items bought instore to any store location. Returns are processed via the Epicor | CRS Returns Management system. Transactions are verified through store receipts, credit card numbers or customer phone numbers. "This prevents any loss prevention issues and allows the cashier to do a return even if the customer doesn't have a receipt," says Wermerson.

KIOSK POTENTIAL
Northern Tool & Equipment also is looking at the potential of adding another customer touch-point in the store, to further extend the customer's total access to inventory, as well as product information. The company is looking at the potential of in-store kiosks, both as a way of pushing content to the store, and as a way of integrating the stores with the Website. Customers, says Wermerson, "really need a salesman that understands what the customer is going to use it (the product) for and what is the best fit." But what if a salesperson is not immediately available? What if the question is about items that aren't carried in the store? With instore kiosks NorthernTool & Equipment is looking to push content about products into the store. So if a customer wants to know more about a tractor or a compressor, he can watch an informational video on the kiosk.

The kiosk also would make the company's Web site available in the store, allowing customers to order items themselves for direct delivery to their homes. Customers wanting an item delivered to the store could go to a sales associate to order it through the Total Warehouse Access proram.

THE NEED FOR SPEED
Contractors and handymen can not afford to spend too much time away from their job sites. They need to know if the product they want is available and where it is. For store customers Northern Tool & Equipment offers what they call the "I-Cam" which enables sales associates to look up inventory in all stores within a certain area to find out which store has the item. Customers can save time by calling a store ahead of time to have an "ICam" search done.

If the customer wants to take it one step further and call the specified store to double check, Northern Tool & Equipment saves him time by equipping personnel with wireless VoIP phones from Nortel. "We get a lot of calls asking if we have a specific product," Wermerson says, and now "you don't have to go back to an office to answer a customer call." Managers can take the call on the floor and quickly give the customer an answer without putting him on hold.

Northern Tool & Equipment also is speeding up in-store returns by enabling remote return authorizations. Managers are notified when authorizations are needed via a wireless network. They then key in their authorization code onto hand-held Motorola PDAs, and the cashier can move forward with the return.

Another area of the business in which Northern has been successful with mobile technology is in their distribution centers. All picking in the DCs is voice directed. DC employees wear Vocollect headsets to receive instructions. "There have been significant improvements now that our people in the DCs have both hands free. Voice directed picking has increased productivity," Wermerson says.

In spite of its successful forays into the realm of mobility, Wermerson believes the company has a long way to go. "Mobility is an area in which we need to improve," he says. The company is looking at the potential for using handhelds for line busting.

From speeding up the ordering and returns processes to extending customer access to product information, Northern Tool & Equipment relies on technlogy to serve the needs of its customers. "I don't think any company can grow without proper IT infrastructure," says Wermerson. "I think our IT department's ability to stay in front of the technology curve and success in partnering with the business units has been a key to Northern's ability to grow."