|Business||Specialist paint manufacturer|
|Number of employees||50|
|Project||Manage very large numbers of customers cost-effectively; find efficient ways to reach new markets; cut costs of sale and increase total revenues|
|Solution||IBM eServer iSeries Model 800 server and IBM xSeries 225 server running Linux and IBM WebSphere Commerce Express, providing Web ordering and fulfilment services|
|Business benefits||Small customers can order single and lower-value items at very low transaction costs; automated sales data entry reduces operational costs; enhanced customer service with online account information served directly from internal ERP system|
Bolton-based Firwood Paints manufactures specialist paints and surface coatings for industrial applications. Registered to the ISO 9000 Quality Management Systems Standard, Firwood employs 50 people and researches, develops, tests and manufactures high-performance products to precise, British Standard RAL, Munsell and other colour specifications.
The company has a relatively large customer base, with almost 2,000 active accounts, many of which previously relied on telephone and fax communications to place orders with Firwood. Managers identified that the cost of servicing customers who ordered one-off products was as high as the cost of selling to customers who ordered batches of 5,000 litres or more. The challenge was to continue to expand the total customer base without increasing costs.
Martin Wallen, Managing Director at Firwood, explains: 'The market was getting increasingly competitive as volumes and margins shrank, and we needed a strategy that would reverse this trend, help us reach new markets, improve customer service to retain existing accounts and cut the costs of doing business on smaller accounts.'
A brighter solution
Firwood engaged Stratagem, a specialist consultancy, which recommended turning to the Web to provide self-service sales for smaller customers. The aim was to provide a Web site that could allow larger accounts to interact electronically with Firwood, and where new and smaller customers could place one-off orders at the lowest possible cost of sale.
Firwood’s existing production control and business systems ran on IBM AS/400 systems using BPCS ERP software. The challenge was to find an infrastructure solution that would preserve this investment while delivering the sales benefits of Web technologies.
IBM Business Partner CSI advised Firwood to implement an IBM eServer iSeries Model 800 server, linked to an IBM xSeries 225 server running Linux. The iSeries 800 supports the BPCS manufacturing control solution and manages the product catalogue for the Web site, which runs on the x225 server.
'The new iSeries server has given us the capacity to handle our BPCS production and ERP systems, while serving live data to WebSphere on the x225,' says Martin Wallen. 'When customers place orders online, the integrated solution generates all the necessary internal documentation, avoiding human error, saving time, and giving us a clearer audit trail and analysis tool than we have ever had before.'
Faster, more cost-effective
Running on the xSeries 225, IBM WebSphere Commerce Express links back-office systems with a Web site featuring the product catalogue and offering full e-commerce capabilities. Customers can browse and order by product type, pack size and availability, which is updated directly from the production systems running on the iSeries 800. The introduction of Web-based ordering and account management is expected to lead to a dramatic reduction in administrative workload for Firwood, saving time and money.
'It was essential to fully integrate the new Web-based systems with our tried-and-trusted back-end systems,' says Martin Wallen, 'and only IBM WebSphere gave us the confidence that we could do this cost-effectively and reliably. Managing our back office systems on iSeries helps us to ensure high security and availability for data.'
Stable platform for business
For small, fast-growth companies such as Firwood, a key concern is that IT systems should deliver cost-effective support for business without requiring constant administration. Firwood is a long-term user of IBM OS/400-based systems, choosing to stay on the platform precisely because of its robustness and low long-term cost of ownership.
Says Martin Wallen, 'The iSeries server is ideal for our business -- giving us a totally robust environment that requires very little management.'
He concludes, 'In tandem with traditional sales, the iSeries and xSeries solution has opened up a multi-channel route to market, enabling us to expand the Firwood brand without a corresponding increase in costs.'
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