The Challenge
The client sells and delivers cleaning chemicals to large Hotels and Restaurants, specifically dish washing machine products. Traditionally the business waited for customer to call in their orders. The client was in a reactive state dealing with the following day-to-day issues:
- Restaurant management forgot to order.
- Rush Orders called in when the restaurant was completely out of product and required the Distributor to supply immediate delivery.
- If orders had not been called in for a long period of time a sales representative would have to be dispatched to investigate why. This was hard to catch.
- Order went to a competitor.
- Worst case scenario the customer had been lost altogether due to low servicing.
All cases above represented a significant loss of revenue!
The Distributor approached to Bolero Wireless looking for a solution. The vision was to implement a new business model whereby they he could eliminate the intense competition that existed in his industry, automate order taking and replenishment, automate monthly billing and receivable collection, introduce a "rental" program and outsource logistics.
The Distributor also wanted to implement dishwasher rental program whereby clients would sign exclusive long term supply agreements based on a fixed price per cycle “per wash”. These supply agreements would include the dish washing equipment, all chemicals, parts and service charges. The key to successful implementation would be consistent and timely monthly meter readings.
The Distributor realized they neither had the human resources or IT infrastructure to launch and manage his new rental model using his existing tools.
The remainder of this case study will show how these various problems were solved, how the Distributor is no acting in a Proactive state and how the sales at the Distributor have steadily increased year over year with the introduction of the Bolero Wireless solution.
The Solution
The Bolero Wireless team looked at the business requirements from many angles and concluded what currently represented the rental models greatest expense in time and resources was “manual meter reading”. At the heart of our solution automatic meter reading (AMR) equipment would be installed on all rented dishwashers.
Automatic meter reading (AMR) would actually drive the complete solution effectively becoming the Distributors enterprise resource planning (ERP) software, and would eventually automate all business processes and manage all future day to day operational decsisions.
With the latest advances in mobile technology, cloud based computing was chosen as the best platform to deploy the Bolero Wireless ware washing dishwasher rental ERP. Cloud based computing would make the application scalable and immediately available to all field service workers from any Internet connected device.
The following diagram provides a high level overview of the overall technical architecture of the BolerWireless.com solution. The selected technical architecture has proven to be highly reliable and consistent in reporting the value of all 150 virtual counter events anywhere the solution was installed in this large (2+ million population) city. The communication backbone incorporated into the solution includes a high speed GPRS/GPS network.
The Components
The Bolero Wireless automated virtual counter and meter reader hardware was developed to be installed in minutes by anyone with limited electrical knowledge. The Bolero Wireless virtual counter is a three wire installation that uses the dishwashers main power supply. The installer only needs to connect the black to black the white to white and a signal wire from the timer. The Bolero Wireless Virtual counter is on the GSM network in minutes and reporting back to the cloud updating the client data base.
Once installed the AMR device reports their current count 4 times per day. This was believed to be the best balance between data reporting costs and real time information.
In this solution, all 150 dish washing machines have been installed with the Bolero Wireless Virtual counter and is made up of the following components
- Bolero Wireless GPRS/GPS Wireless Modem configured as a Vitrual Counter;
- Unit sends GPRS message every 4 hours and reports in the HQ the current value of Virtual counter;
- A cellular GPRS message is sent to the cellular Network and lands in the Bolero back-end;
- The Event is logged real-time in the Bolero database and Bolero Live! Web Portal.
The Results
Every wash performed is now a billable and usable commodity driving the Distributor's cloud based ERP. Every dish machine rented to restaurants is registered on the ERP along with quantity of product consumed per cycle. Every product delivered to a client is registered by the system as a total number and is converted to a virtual bucket in the clients account. Every wash automatically reported, is calculated in terms of product consumed, and subtracted from the restaurants virtual bucket of detergent. When multiplied by tens or hundreds of dish washing machines the Distributor is now able to view all machine level inventory on one screen. With the global overview offered by Bolero Wireless, inventory shortages are avoided, orders are placed and all without any human intervention.
Every machine rented and every wash performed must be billed. Every machine renter is an individual with the potential to be offered a different price or volume discount. A contract mechanism was developed were the Distributor could specify the rental price, billing frequency, the number of cycles included and the price per cycle. As per the billing frequency (monthly, weekly, etc) the daily AMR are tabulated, and invoiced automatically. All clients who rent dishwashers agree to a pre-authorized payment program, accounts receivable are virtually eliminated, and clients are emailed or posted paid invoices, all performed using the historical daily meter reads, without human intervention.
Preventative maintenance is automated based on the number of cycles performed. Predefined tasks are outlined and performed as required. Automated work orders are generated with task description. Field service workers perform tasks and update the client profile over Internet enabled hand held devices.
The system was implemented in 2008. The following graphs showcases the sales year over year since the Bolero Wireless sytstem was inplemented
As can be seen by the preceding graph, the sales trend is consistently upwards from year to year with the overall trend of sales moving upwards. As of November 22, 2012 at 12:00 noon, the total number of sales in 2012 have out performed the total sales from 2011 with the busy season fast approaching. It is anticipated that the total sales for this year will be the best year ever in the Distributor's corporate history.
After speaking with the owner of the Distributor, the total spend on human resources has remained the same since overall introduction of the system. This means the company is now doing more with less and is able to focus on the main business at hand, attracting new accounts, and up-selling existing accounts. On the Distributors custom satisfaction survey, customer satisfaction of the Hotel and Restaurant managers has increased dramatically and rush orders are virtually a thing of the past.
On average sales have increased from $460,300 generated in 2009 to a projected value of $812,600 in 2012, an overall increase of 76%.