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Multichannel Distribution Specialists

Integrating Wholesale Distribution alongside In-Store, Online and Machine-to-Machine to let today's multichannel businesses increase efficiency and reduce costs while achieving flexible and agile control of the supply chain.

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Archive for June 2013

International Expansion – Smaller companies are becoming more competitive

28th June 2013

As companies seek new markets the lure of international expansion often becomes a major consideration in driving sales growth. Until recently, however, the costs and risks of establishing and managing such an environment have created a barrier to entry for small and mid-size companies. Typically you would have to look no further than the following to understand the uphill battle faced by smaller organisations:

  • The cost of the additional IT infrastructure
  • Country specific taxation reporting requirements
  • Staff recruitments
  •  Logistics around product distribution
  • Consolidated reporting
  • General administration
  • Potential cost of a failed venture

This situation has turned around somewhat with the advent of Cloud-based systems, which together with the emergence of business process outsourcing, have helped reduce the barriers. The relative low cost of using and maintaining a cloud-based infrastructure makes it an ideal tool to drive international expansion. Lower initial setup costs, lower maintenance costs, lower support costs and more agility to be able to quickly scale up or down and remote office access, all add to the mix. It is entirely understandable why many large corporations today deploy cloud-based platforms alongside their corporate ERP (Enterprise Resource Planning) systems, specifically for this reason.

While a cloud-based infrastructure provides the ideal environment for organisations that intend expanding internationally there are local compliance requirements that also need consideration. Here the role of the cloud-based ERP vendor is important. Take for example NetSuite where you have a cloud-based ERP application that as standard provides for localised taxation reporting in 51 countries and support for 21 languages. Having the ERP vendor manage this area significantly reduces the onerous task of managing compliance in any foreign country.     

The final piece in the jigsaw is the use of a business process outsourcing partner to help scale the international business by providing resources and specialised skills. To be effective in providing these services it is important that the outsource partner has international reach and can provide assistance and advice across various countries. Take for example RSM Tenon, they can help establish and manage the operations in the foreign country without you establishing a costly local infrastructure. Find out more about the outsource services RSM Tenon provide.

So in summary, by deploying a cloud-based business management tool together with the services of a reputable business process outsource partner, smaller mid-size companies now have an easier form of access to compete on an equal footing with larger corporations for their share of the international market, all of this with relatively low levels of risk. 

Shopping cart abandonment facts and how to avoid it

27th June 2013

What are the statistics and what are the steps you can take to lower cart abandonment on your web shop?

Shopping cart abandonment statistics

Shopping card abandonment means that a buyer adds products to their shopping cart but doesn’t complete the purchase. There are various abandonment statistics published online with slight variation in their findings. Thankfully the folks at Baymard Institute have collected data from 19 reliable recourses and as a result they have calculated an average abandonment rate of 67.35%.

So what are the prime reasons for buyers abandoning their cart?

This infographic from Milo lists some of the top reasons:

cart abandonment reasons

Research findings from the comScore 2013 Stat Of Retail Presentation highlights some more useful statistics:

  • 44% of those buyers who abandoned a shopping cart, did so because of long delivery times
  • 49% of consumers say free shipping is the most valuable online shopping incentive retailers can offer
  • 3 out of 4 have added to their cart to qualify for free shipping
  • 2/3 of shoppers review a return policy before making a purchase

A survey of 2,000 UK consumers, conducted by Econsultancy and TolunaQuick found that 74% of shoppers would abandon a purchase due to high delivery charges, while 54% would drop out if they experienced any technical problems. Other popular reasons are: the price is too high (49%) and the need to register before buying (25%).

8 reasons consumers abandon shopping carts

Having analysed all the statistics from the above three sources, It is possible to conclude 8 main reasons in order of importance:

  1. Shipping cost too high or lack of free shipping
  2. Not ready to purchase yet. Saving items for later
  3. Delivery time too long or not displayed early in the process.
  4. Price too high. This is normally the total shipping inclusive price.
  5. Technical problems
  6. Not happy with the return or refund policy
  7. Ability to place order without registering
  8. Ability to pay by PayPal for buyers who want to use their PayPpal account to pay instead of using a credit card.

Note that although I have been only mentioning cart abandonment, most of the points mentioned above will have an impact on both cart abandonment and checkout abandonment.

How to improve the cart abandonment rate

Having identified the top reasons why people abandon cart, it is not difficult to arrive at viable solutions to overcome the main obstacles.  Here is my summary:

  • According to comScore, 49% of consumers say free shipping is the most valuable online shopping incentive retailers can offer. If you can offer free shipping and clearly display early on that buyer qualifies for free shipping, then cart abandonments due to free shipping should no longer happen.
  • Save for later or wishlists, allow the shoppers who are not ready to buy yet to save their items for later and hence not use the add to cart for this purpose
  • Clearly display delivery and stock information on the product page and provide fast delivery times.
  • According to comScore, 67% of consumers will shop more with a retailer if they offer a hassle-free return policy, hence offering an attractive return policy helps as an incentive
  • Usability and error free checkout. It goes without saying that it is critical that the cart and the checkout process are well designed, user-friendly, and free from technical problems.

For more detailed tips and a visual presentation here is a useful info-graphic

NetSuite Manufacturing Gets An Upgrade

21st June 2013

NetSuite beefed up manufacturing support in the latest and one-before releases with the addition of enhanced assemblies and work orders coupled with new routing and work centre features.  You'll want to keep up to date with these new features if you use assemblies in any way in case your business can benefit.  Here's a quick trip through the changes to manufacturing.


If the components of your assemblies change over time - possibly due to design, engineering or sourcing reasons - the new Effective and Obsolete Date fields on each component are what you need.  You'll find these on the Components sublist of each assembly item.  Using these fields you can specify the lifespan of each component, effecting changes to the BOM over time.  When you build an assembly the BOM effective at the date of the build is used.

Netsuite manufacturing -  assemblies

Assemblies also sport new fields to support WIP (see next) - WIP checkboxes on the Locations list to indicate that an assembly should be tracked for WIP at specific locations, plus WIP, Scrap and Cost Variance Accounts on the Accounting tab which point to the GL accounts that will be used to track work in process for the item.

Work Orders and WIP

If you're building assemblies then you're probably using using work orders.  Work orders commit components before the assembly is built, allocating inventory when the order is created (just like a sales order does) to give you real-time component availability.  Before this release work orders were either pending or built, so you would mark the work order built in NetSuite once manufacturing/assembly was completed.  Now with the new Manufacturing Work In Process feature enabled, you issue components to work orders, indicate the work order process is complete and finally close the work order all as different steps, enabling NetSuite to track WIP over time.  

Netsuite manufacturing work orders and WIP

The new WIP workflow is enabled on the Work Order itself by ticking its WIP checkbox.

Manufacturing Routing

This new feature enables complex work orders that involve multiple people or processes to be set up and executed.  NetSuite tracks progress of the work order through its manufacturing/assembly process and enables machine and labour costs to be rolled in to the assembly's asset value.  WIP is updated as the work order executes and can include a number of elements calculated during the process.

Routing uses Work Centres to define groups of employees that perform specific roles in the work order process, for example a Spray Room group.  Once you've set up your work centres (and a few other things that are needed) you can define a Manufacturing Routing, which is a template containing the list of steps in the work order process.  Each step can involve a different work centre and have different overhead and run rate (duration) costs.

Netsuite manufacturing routing

Netsuite manufacturing bill of material

Once your routings are ready you can attach them to assemblies on the item's new Manufacturing tab, and specify them on Work Orders in the new Manufacturing Routing field.  When you save the work order a list of manufacturing tasks are created based on the routing template.  As work progresses you update the tasks by marking them In Progress and finally Completed, and also record actual overhead and run time for the task.  NetSuite uses the routing template to calculate machine and labour costs for the task and adds this to the assembly's WIP.   

Please see NetSuite Help for more info on the above features, and also for Standard Costing for Manufacturing which is not discussed here, or call or email our support team.


Finally, an update on the upcoming release 2013.2 (hopefully you've now finished getting your head around 2013.1!).  The next release rollout to customers starts 19-July and is scheduled to finish 6-September.  It's worth adding the New Release portlet to your dashboard if not already there, to keep an eye on your preview release and upgrade dates as well as access the new features release notes: on your dashboard click Personalise Dashboard, then add the New Release portlet.  We'll have more on 2013.2 in my next post; in the meantime if you'd like help with planning or executing your release testing just give us a call or email our support team at