Jergens Industrial Supply, a leading Ohio area/Midwest industrial distribution company that was founded in 1960, recently teamed up with custom software development group MindHARBOR Inc. to solve a problem in their supply chain -- and in the process found a new line of Internet of Things (IoT) technology to market to other distributors.
Jergens, a user of the Epicor Prophet 21 ERP system for wholesale distributors, had originally approached MindHARBOR in 2015 for help integrating their AutoCrib vending systems with their Prophet 21 software.
After MindHARBOR successfully integrated AutoCrib with Prophet21, both teams discussed the early IoT Dash Buttons that Amazon was bringing to market. Out of those discussions a plan and a project roadmap were developed to engineer a solution that enables on premises (1, 2, 3 easy) remote resupply of products from WiFi enabled IoT buttons, through a web portal and into Prophet 21 (or any other legacy system).
Snapshot of Jergens Industrial Supply current vending/consignment:
- Consignment accounts for 27% of JIS’s business per month
- Vending machines: 110
- Consignment customers: 66
- Other consignment locations: 18
- MRO rooms, drill cabinets, abrasive wheels & coolant
Prior market strategies for vendor-managed inventory
- No strategy at all.
- Requisition forms: Users
- forget to fill out a requisition form and the time-consuming process is inefficient.
- Kanban: keeping the cards up to date is a challenge; reorder points that are listed on the Kanban cards are often missed. Kanban cards don’t get replaced, or can be put back in the wrong location or go missing.
- Vending machines are a costly investment at $10,000 to $50,000. The machines take up valuable floor space, have added carrying costs to maintain, and they do not support large items.
Who needs IoT resupply buttons?
This solution provides a replenishment method to maintain an inventory of critical Items for production; non-critical Items for production; facility maintenance items; and larger oversized items that would not fit into a vending machine, for example paper towels, shop rags, toilet paper or coolants.
- First time users. This could lead to larger managed solutions.
- Customers who don’t require full vending solution; who purchase a limited number of items.
- Customers that you can reduce the costs to support them with an inventory management solution.
- Large customers who want a distributor to manage “all” of their needs.
- Customers currently using a vending solution, with inventory items that don’t fit in them.
- Allow customers to manage larger bulk items.
- Customers who want to enter into a vendor-managed inventory solution for the first time and test a supplier. This could lead to a larger managed solution.
What are IoT buttons?
The Amazon Dash Button is a small electronic device designed to make ordering products easy and fast. The Dash Buttons come in packs; each device contains an embedded button that can be brand customized with a distributor’s name and/or the name of a frequently-ordered product.
You can configure/customize the buttons, install them onsite, connect them to an on-premise wireless network, and let the ordering begin. These buttons need to connect to the customer’s WiFi. If the WiFi password changes the buttons will not connect to the WiFi when the button is pressed and the order will not be processed. The button will give a red light indicating the order was not sent. If the button is pressed multiple times, the button will only submit one transition for the order quantity each 24-hour period. So pushing the button multiple times will not impact the order quantity. Each button lasts for approximately 2,000 clicks/orders.
IoT buttons are installed in a facility or anywhere they are needed (within reach of WiFi). You can stick them on racks, shelving, on or next to equipment, drawers; or anywhere you can think of.
How do the buttons work?
Pushing a button triggers an order. One push equals one item at pre-configured reorder quantity, and a confirmation email is triggered. Once you push the button, the LED on the unit will turn green, signifying that your order has been processed. If you see a red light the order was not sent. If you see a blue light that means you held the button down too long and entered the configuration mode. If you don’t think the order has been submitted, press the button a second time. It won’t hurt and won’t reorder additional items.
After the order is placed: Once the button is pushed an order notification is delivered by email to a pre-approved order manager. These confirmation orders are sent via email and include a link to the customer control portal with is a secure webpage accessible by smartphone, tablet or PC. The order notification alerts track all buttons pushed in 24-hour period.
Order confirmations and management: Once the order manager clicks the link within the order notification email, he is able to view the customer control portal. This will allow the customer to review, edit, and/or approve the items that were pressed in the past 24 hours.
Customers can confirm an order, change amounts, add purchase order numbers and delivery requests. The system is designed to batch all the items at 3:00 pm every day. This allows the order to be built and reviewed each day by the customer. It would then be submitted to the distributor for processing and fulfillment. After the initial e-mail the link is only valid for ten days. After this time the link will no longer work and the button will need to be pressed again and the order quantity confirmed.
Customer portal with orders sent directly into the ERP: Confirmed orders go directly from the customer portal and import directly into the Prophet 21 (or other ERP) system using the scheduled import service manager as an unapproved order. Orders are reviewed and approved for delivery, and either shipped to the customer for replenishment or delivered by the distribution team.
Visit: www.JIS.com for more information about Jergens Industrial Supply.
MindHARBOR is a custom software application and business intelligence development shop founded in January, 2000. Visit: www.MindHARBOR.com