E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Ace is building new relationships with business customers. The chain of more than 4,800 hardware stores is targeting small businesses through TheSupplyPlace.com, where home builders, plumbers, schools and other organizations can set up accounts with their local Ace store and shop among 80,000 products.
Ace Hardware Corp., which promotes its stores as “the place with the helpful hardware folks” for do-it-yourself consumers, is now reaching out to small businesses with a similar pitch. Its main marketing tool is TheSupplyPlace.com, a business-to-business e-commerce site designed to connect tradespeople, schools, government agencies and other local businesses and institutions with their local Ace store as well as with the retail chain’s company-wide inventory.
If a home builder needs a large quantity of nails, or a school needs a ton of ice-melting salt, Ace is offering its new B2B site as an easy way to arrange for such orders through a local store.
“We’re known for being helpful to consumers with a DIY focus, and we wanted our business customers to know we can service their needs as well,” says Bruce Rohm, corporate manager for business-to-business. “Most business customers don’t think of us as a supplier; they don’t realize they can order through our stores pallets of products.”
Ace introduced The Supply Place site in a beta test in November, then officially launched it in January. As of Friday, 76 stores across 21 states were connected to the site and listed in its store locator. “Our goal is to have 800 stores active on TheSupplyPlace by year-end, and by the end of 2015 be closer to 2,000,” Rohm says. Nearly all of the 4,500 Ace stores in the United States are independently owned, with about 86 owned by the company.
The average Ace store already has 400 active accounts with local business customers, but most of those customers don’t buy as many products, either in terms of variety of SKUs or order volume, that Ace figures they could. The Supply Place project is the company’s first effort to reach out to such customers in a company-wide effort and with a dedicated online service.
In addition to being able to place orders on a business account 24/7, customers can log on to see personalized product lists and pricing. When a business places an order though TheSupplyPlace.com, the order can either be fulfilled from the local store’s inventory or from an Ace distribution center. It’s up to the local store and the customer to decide whether to arrange for in-store pick-up or delivery to the customer’s place of business, Rohm says.
To begin taking orders through TheSupplyPlace.com, independent Ace retailers must go through a certification process in which Ace reviews their ability to establish processes for identifying and managing the purchasing needs of their local business customers. In a preliminary step to launching the TheSupplyPlace.com, Ace pre-certified 790 stores as B2B retailers last year and found that, as a result, those stores produced 7.1% more B2B sales in a year-over-year comparison, Rohm says. The increases resulted from the retailers learning through the certification process to better understand their business customers’ needs and arranging to fulfill orders according to customers’ desired volumes and delivery methods.“They didn’t even have the online tool yet, and they still had a 7.1% increase,” he says.
Ace worked with Epicor Software Corp. to deploy a modified version of the Epicor iNet eBusiness Suite, which provides an e-commerce platform that Ace shares with Ace store owners. The platform includes integrated back-end business operations software that provides the individual retailers with visibility into sales and inventory records. Stores routinely send nightly batches of sales and inventory data to Ace’s corporate business software suite from SAP AG.
The e-commerce technology platform provides Ace control over site content to ensure consistency that supports the company’s brand, Rohm says, but also lets local retailers customize their local sites with local content like product promotions and service hours.
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