Kibler Lumber Increases Margin, Decreases Shrinkage And Reduces Accounts Receivable Charge-Offs With Falcon
Executive Summary
A former Dimensions user, Kibler Lumber now relies on Activant
Falcon® to improve efficiencies and increase profitability. The special
order process runs more smoothly. Inventory is more accurate.
Information helps improve customer service. Falcon is at least
partially responsible for a 33% reduction in inventory shrinkage, a
margin increase of 1.33%, and an accounts receivable charge-off
reduction of approximately 50%.
Dynamic Business Requires a Flexible Business Solution
Starting as a feed and flour mill in southern Ohio more than a century ago, Kibler Lumber
shifted its focus to building supplies during the building boom after World War II. Today
this fifth-generation, family owned business serves contractors and do-it-yourselfers in
southern Ohio and northern Kentucky. Kibler is passionate about customer service and the
president, David Bohl, believes that satisfying customers is the key to thriving against
competitors, including big box retailers.
After running on Dimensions for more than seven years, Kibler searched for a replacement
solution. Kibler explored a newer UNIX version of Dimensions, ECS Pro, CS2000 from Do
it Best, Activant Eagle® and Activant Falcon. “Falcon was the best choice for us. It offered the
best ability to customize and is built on a relational database, which is more powerful and
flexible,” explains David.
Kibler had record sales one month after go-live. “We did a good job of training everyone on
Falcon before go-live. Our customers saw no disruption in our business, which was our goal.
Activant goes ‘above and beyond’ to get their customers converted,” continues David.
Inventory Management is Faster, Easier and more Accurate with Falcon
Kibler conducts a full physical inventory once each year and with Falcon, it now takes only
one day instead of two and one-half days. Cycle counting and receiving are faster and more
accurate with RF guns that update Falcon inventory in real-time. “Falcon is more accurate
and it makes us more productive. In our first full year on Falcon, we had a 33% reduction in
shrinkage, which we know is partially attributable to Falcon.” describes David.
Managing 30,000 SKUs across five locations is critical to Kibler’s success, and with Falcon
it’s easy to check stock and transfer inventory between stores. “Falcon enables us to balance
inventory between locations, still meet the customers’ needs, and save money. We see which locations have excess stock of an item and transfer that stock between locations instead of purchasing more,” explains David. “We don’t have a large purchasing staff. It’s just me and one other person working part time. We rely on Falcon to help identify what to purchase. The report makes a recommendation based on history and we apply market knowledge to arrive at our order. It takes much less
time than with Dimensions.”
Special Order Management: Better Information, Better Tracking, Better Results
Special order management had been challenging for Kibler. Prior to Falcon, it was
cumbersome to research order status and therefore difficult to inform customers of their
order status. Falcon delivered noticeable improvements. “It’s very fast to do lookups and now
we are doing a much better of job managing and tracking special orders. We can research
orders via a key word search on item description, by order number, by customer’s name, or a
variety of other ways,” describes David. “When a special order item is received, an email alert
is automatically sent to the salesperson. They then proactively contact that customer,
expedite delivery, and consummate the sale. Falcon even helps us track the cost of returned
special order items so that when they are resold, we know our exact cost. The entire special
order process works now, whereas it didn’t before.”
Pricing Flexibility Increases Competitiveness and Margins
In the volatile lumber market, lumber costs change frequently. To keep prices updated,
Kibler uses current costs to calculate prices and margins on spreadsheets and then uploads
fresh information to Falcon. “Supplier costs change constantly and we need to be current in
our pricing in order to optimize our profits. I regularly look at costs and calculate our retail
prices to ensure our competitiveness. Automatic emails alert sales managers and store
managers when a salesperson overrides retail price. We’ve empowered our salespeople to
manage their margins to be more aggressive as needed to win business, yet obtain higher
margins in less competitive situations. The combination of flexibility and control helps
improve our overall profitability,” explains David.
Information Drives Customer Service and Profits
David and his store managers can answer questions and explore potential problems very
quickly in Falcon by drilling from summary information to transaction detail. It’s much
more efficient than with the Dimensions system, where they had to run and print reports.
“Falcon helps us deliver outstanding customer service, be more competitive in the
marketplace and improve our bottom line. Even during the 2006 declining lumber market,
we improved margin. We see evidence that Falcon made improvements throughout our
business and in our two years with Falcon, our margins improved 1.33%. Our inventory
shrinkage decreased by 33% and we reduced our accounts receivable charge-offs by about
50%,” recalls David.
"We see evidence that Falcon made improvements throughout our business and in our two years with
Falcon, our margins improved 1.33%.”
