Fogdog Sports has its roots in a web development company that was founded in 1994. The company turned to Internet retailing in the form of SportSite.com in early 1998, and launched Fogdog Sports in November 1998. Today Fogdog Sports is one of the leading sports retailers on the Internet, and an expert in outsourcing fulfillment services. The company has built a network of partners to supply and distribute its broad selection of products. Many partners are traditional sporting goods retailers, or Internet retailers such as TSI Soccer. Although TSI Soccer has its own website, they also represent most of the products Fogdog sells in the soccer section of their site. Soccer orders are automatically passed through to TSI Soccer for fulfillment, and are shipped out using Fogdog boxes and labels. By bringing together products from diverse companies under one Internet brand, Fogdog has been able to tap into the expertise of specialists in distinct fields of sport. Key to Fogdog’s success is the ability to get its partners to provide their consumers with fulfillment services under the Fogdog Sports brand. In addition, Fogdog owns its own inventory in certain product lines. The distribution of this inventory and fulfillment of orders is outsourced by Fogdog Sports to Keystone Internet Services. “We decided to outsource because we needed to hold our own inventory quickly. To build your own facility would take anywhere from 18 months to two years,” says Mohan Komanduri, Logistics Director at Fogdog Sports. “Within this environment you don’t have that time. Outsourcing provides expertise [from] companies that know the fulfillment business, and gives you the ability to serve customers very quickly.” When Komanduri, who was a consultant with Kurt Salmon Associates prior to joining Fogdog, began looking for fulfillment services in June 1998, he had only twelve weeks to get everything in place for the holiday season. Finding a partner who could deliver the quality of service they needed in such a short timeframe was critical in Komanduri’s selection process. In selecting from potential partners, Komanduri says he considered two key requirements: “The ability to meet our needs in the timeframe we needed; and the ability and expertise of doing direct to consumer fulfillment”. Fogdog found that many companies offering fulfillment services don’t necessarily have the expertise and experience needed to ship orders direct to consumers. “Mail order companies, like Fingerhut or Keystone, already know you [ship to] an individual consumer differently than shipping to a retail store.” Fogdog wanted a supplier with direct to consumer experience and the ability to handle high SKU volumes. Keystone was able to meet Fogdog’s very tight timescale and was selected as Fogdog’s primary fulfillment service provider. Being able to seamlessly integrate multiple distribution partners into their network is one of the things that set Fogdog Sports apart from competitors. Fogdog can see inventory levels at any of their partners at any time. All of the merchandise management and forecasting is handled by Fogdog. Fogdog uses Retek’s merchandising software to manage inventory. The Fogdog site also provides a white glove service for some items, such as treadmills from Reebok, which are delivered to the home and installed for the customer. This includes showing them how it works and removing the packing materials. Fogdog processes all customer returns in-house. Return shipping is covered within 45 days, under their unconditional return guarantee. Komanduri’s top three recommendations in selecting a solution: 1. Do they get it? Do they understand what it means to ship direct to the consumer? “A lot of companies out there say that within a month they fulfill 99%, however on first shipment it is only 95%. Every time you create one of those units [short shipments] it generates at least one contact directly to the customer, to let them know that there is a problem. The do they get it factor means; do they understand that every order that goes out of the door has to be shipped out accurately.” 2. Can they change at Internet speed? Do they have the capability to change rapidly? Every month, Komanduri says he needs to add a new feature in anticipation of changing consumer expectations, or because someone else is now offering it. For example, just prior to the holidays the ability to gift-wrap was added to the site. This was in place in just a few weeks because Keystone had the skills and capability to implement it. 3. Are they responsive in meeting the customer’s needs? Keystone dedicates at least one full time account executive to Fogdog. Key factors in Fogdog’s selection criteria were the ability to meet the timeframe, experience in direct to consumer, and cost.
www.fogdog.com www.keystonefulfillment.com For a review of Keystone Fulfillment and other fulfillment providers join eRetailNews now. ConsultERN Recommends:1. Consider your whole supply chain. How you deliver the goods to the consumer is dependent upon how well you can keep inventory replenished, and what other options you have, such as drop-ship from vendor to consumer. 2. Before you look for a fulfillment provider you need to know how you will manage inventory. Will you use internal systems (or packages) to control purchases and forecasting, or do you need these services from your fulfillment partner. 3. Consider how you might be able to utilize other retailers to provide some of your fulfillment services for you, especially if you are building your Internet brand to meet niche markets. 4. You will need to provide consumers with online order status information; make sure you know what your technical requirements are to achieve this. 5. Consider whether or not to outsource your call center service. | 