Tags Innovation, Data management, Strategy, Change

The little shop that could

Faced with the very competitive retail world, The White Company took a big step, as Marc Harper explains: it used IT to improve service. Self-confessed fan John Hutchinson buys in to the story.

Time for full disclosure: when asked to write about The White Company, I jumped at the chance. Our household is filled with the company’s stuff. We like what it sells, how it markets itself and, living in the wilds of Wales, its mail-order efficiency and solid online service are much appreciated.

How do they achieve this, when so many other home-shopping companies have proved far less reliable – and, in many cases, gone bust, soon after starting trading? Why is it that The White Company orders tend to show up in the correct quantities and on time, when others can only manage partial deliveries and delays? The answers turn out to be an object lesson in how to get the essentials of retailing right, and then manage phenomenal growth well, in a ferociously competitive market.

Measured against the retail giants, The White Company is a toddler, but it’s growing up fast. It was started in 1994 by Harpers & Queens journalist Chrissie Rucker in an attic bedroom, after she spotted the opportunity to market a range of “beautiful but affordable” household linens (all white, initially) that were difficult to find anywhere else from a single source. The first orders from her 12-page mail-order catalogue were packed by hand and taken down to the local post office.

It’s still a private family business, but The White Company now processes 3,500 orders per day and has 450,000 customers on its books. Turnover is up – expected to exceed £50m – and it runs 14 wholly owned UK high street shops plus three concessions in department stores, together with three franchise outlets in Dubai. Logistics are handled in-house from a purpose-designed warehouse in Northampton. Next year, the company is looking to open its first shop in New York, while also increasing the number of UK stores.

Business is currently split three ways, between physical retail stores, brochure-driven mail order (eight editions per year) and online sales. The company’s revamped website (www.thewhitecompany.com) is expected to boost online orders to 40 per cent of the total, with mail order and store sales both forecast to keep increasing in volume.

While every retailer faces a range of major concerns, from logistics to risk management, one of the biggest issues for The White Company is a common nightmare for all in the field – how to order exactly the right quantity of products that customers actually want to buy and stock them exactly when they are needed. As Marks & Spencer discovered in recent years, over-ordering slow moving goods is a costly disaster. The converse proved an expensive mistake at Sainsbury’s, which lost sales through shortages of staple products on the shelves. The answer, it turns out, is a carefully managed IT strategy.

White Company IT manager Marc Harper explains: “Our ability to monitor sales, forecast demand accurately and replenish stocks is crucial. Without the correct forecasting figures, the business would effectively be operating blind.

“We use a single server – an IBM System i i5 520 Express Edition, to be specific – to run all our stock forcasting software. It’s given us the processing power we’ve needed to manage growth over the past two-and-a-half years. It hasn’t fallen over once and it’s essentially a failsafe system, with lots of backup facilities to give us peace of mind. Definitely money well spent.”

While a single server is never going to be the answer to every problem, for The White Company, it was an important improvement. The company’s old server used to collate figures from all its sales channels and crunch the numbers over each weekend to produce forecasts for the week ahead.

“With the old server, processing used to start every Saturday and run for around 36 hours, but this gave us very little room for error, because we need the figures first thing on Monday,” says Harper. “If anything failed, we had a very narrow recovery window – which meant we had to check each Sunday to make sure everything was running OK. When the new server was installed, we dialled in to check on the first Sunday as usual and nothing was running – which was a big worry. But after some investigation, we discovered that it had finished the 36-hour job in less than six hours.

“We had outgrown the old server, but the new one is still doing the work in around six hours, after well over two years and a lot of growth in volume of business. We are already planning the next upgrade to cope with the company’s expansion strategy, but it won’t be needed for some time yet,” he adds.

The decision to upgrade was not without its heart-searching, however – there was a typical “if it ain’t broke, don’t fix it” mentality at work. But finding the right tech partner, in the form of IBM premier business partner Triangle (www.triangle-group.com), made the change as smooth as possible.

“We knew that The White Company was in a unique position,” says Triangle managing director Kevin Drew. The company provided support for the IBM server platforms within The White Company. “They had to keep up with demand and any interruptions could cost, both financially and in terms of their reputation. We needed to get into the company’s mindset, to keep things moving and make sure that nothing got in the way of the business.”

“Their people demonstrated a complete understanding of our business,” agrees Harper. One thing he is not intending to change any day soon is the simplicity of the stock management system – a single, powerful and reliable server acting as a hub for all sources of stock and sales data: “It works for us and I’ve seen enough big companies running multiple systems to know the problems they can cause,” he says.

For merchandising director Claire Pearl, the speed and reliability of the new system makes life a lot less stressful: “We now have high-quality information from 8:00am on Monday, so we can hit the ground running and make accurate repeat-buy decisions immediately.”

And in a company where accuracy and informed decision making are at the heart of its success, that says it all, really.

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The White Company

The White Company specialises in supplying a wide range of stylish home accessories and clothing, principally in white.

Triangle Group

Triangle Group: IBM Premier Business Partner