Selecting the Right Fulfillment Software (766 words)

Six Steps to Selecting the Right Fulfillment Software

By Ernie Schell

More than three dozen software applications are on the market for managing order entry and fulfillment for catalog companies. With that kind of variety, choosing the catalog management system that is best for your company can be confusing unless you approach the challenge with a structured plan.

Try these six steps:

1. Establish systems objectives and priorities. There are lots of reasons for acquiring a new system: managing increased capacity, improving customer service, introducing new business methods (such as continuity shipments), lowering processing costs, improving inventory efficiency, reducing paperwork, supporting better e-commerce integration and so on. You have to clearly evaluate and articulate the objectives that are important to you. Chances are you won't be able to achieve all of them, so it's important to prioritize your goals. When it comes time to choosing among alternatives, your prioritized goals will make that process easier.

2. Assess operations and budgets. Before you start looking at software, you should carefully examine your own operations. Software vendors are all capable of doing impressive demos, and typically believe that their product is a universal solution for virtually all catalog companies. In fact, each system is radically different—there are no standards in this business. So it is up to you to spell out what it is you expect the software to do to serve your business needs for handling customers (whether consumer or business-to-business, orders and inventory).

You should undertake a formal functional needs analysis for order entry, inventory management (purchasing, receiving and warehousing), fulfillment (picking and packing), payment processing, drop-shipping, manifesting, customer database management, accounting and reporting. Do you have specialized functions like gift shipments, multiple warehouses, international shipping, or merchandise forecasting that you want to perform? Spell them all out!

3. Produce a written request for proposal (RFP). The results of your functional needs analysis will form the heart of your request for proposal, or RFP. In addition to the functional requirements, the RFP should provide:

• a request to the vendors who receive it to indicate whether they can meet your requirements as stated; how much and how long it would take to make modifications, where necessary, to meet some of your needs; and what functions they cannot support;

• a profile of the number of orders, customers, SKUs and vendors you need to maintain your daily and weekly average and peak order volumes;

• a listing of all in-house computer hardware and software, including networks;

• an overview of how your business works;

• a time line for the systems acquisition process; and

• requests for information about the vendor, including the number of systems installed and terms for training and support.

4. Investigate systems options. Now that you are properly prepared, you are finally ready to start looking at systems and to determine which vendors should receive the RFP. You can consult compendiums like "The Guide to Catalog Management Software," classified sections of trade publications, Internet searches and catalog industry trade show exhibits to find out which vendors have systems that are appropriate for your situation, based on system cost, consumer vs. business-to-business sales, hardware platform options and other top-level criteria that are important to you.

An initial list of six to eight contenders is a good number to whom to send the RFP. You should allow about four weeks to receive formal responses.

5. Evaluate responses. The RFP helps keep the vendors more or less honest (some vendors will be more "optimistic" than others). Once the formal responses are in hand, you should develop a quantitative method to score them, based on the stated ability of the vendor to meet your needs as is, or with modifications, and on other factors such as system cost or ability to meet your time frame.

6. Review trade-offs. There will probably not be an "ideal" candidate. The final selection of a vendor and a system will be a matter of trade-offs. Perhaps the best-suited solution has not yet been widely installed, so you are assuming greater risk, for instance. Or it may cost twice what you are willing to spend. But if you have followed these steps conscientiously, you should be in a strong position to make a solid decision, based on objective evidence, not merely on favorable impressions fostered by friendly sales reps. n

Ernie Schell is author of "The Guide to Catalog Management Software" and president of Marketing Systems Analysis in Southampton, PA, which helps catalog companies specify and select order-processing software. Schell can be reached at (215) 396-0660 or by e-mail at ernie@schell.com.