Managing inventory as a manufacturer is difficult with spreadsheets for several reasons, especially when you start to expand operations. While spreadsheet-based inventory management systems assist manufacturers in the management of their company, they only make sense for small companies — especially when they have a limited budget to invest in an end-to-end ERP system. 

However, if your organization starts growing or you encounter issues with spreadsheets that affect your service delivery, it might be time to consider other alternatives such as ERP software. Here’s why and when you should turn to manufacturing ERP software for help.

 

Advantages of ERP software for scaling manufacturers

ERP software has several key advantages that can help improve your business processes compared to traditional methods of managing inventory using spreadsheets. 

Generally speaking, process improvements made possible with manufacturing ERP software can also increase revenue and decreased costs. But here are a few more benefits beyond higher returns that may convince you to make the switch.

1. Improved accuracy 

ERP software can improve the accuracy of inventory management by eliminating manual entries and spreadsheets, improving data quality through the standardization of processes across data input points, and tracking relationships between items that are often not tracked in spreadsheet ERP systems. 

2. Streamlining operations

Not only does ERP software improve the accuracy of inventory management, but it can also improve many other business processes. Many ERP software solutions have direct integrations with e-commerce and accounting platforms, allowing you to track all business operations and data in one place.

3. Access to real-time information 

With traditional spreadsheets, some data is entered manually while some comes from a barcode scanner. So, for example, if you do not something, you won’t know if the data is wrong until you receive the physical product. ERP software provides a single source of truth for data, which is updated in real-time as transactions occur. This means that you always have access to the most accurate information possible.

3. Reduced costs

ERP software can help reduce inventory costs by allowing users to create and manage Bills of Materials (BOMs). BOMs allow manufacturers to define the components that make up a product and track their relationships. This helps organizations make better decisions about what items to produce and how much stock to keep on hand.

4. Better customer experience

Your customers drive your business, and ERP software can improve your customers’ experience by providing sales staff with real-time information about product availability and delivery dates. This allows them to provide more accurate information to customers and helps reduce the likelihood of missed sales opportunities.

5. Other benefits beyond manufacturing

ERP software can help improve many other business processes, including accounting, purchasing, and human resources. For manufacturers who are struggling with managing inventory using spreadsheets, ERP software is a valuable solution that can improve accuracy, visibility, and performance. 

 

Manage growth and scale your business with Katana

This is a guest post from Katana. Katana is a manufacturing ERP that gives thousands of manufacturers a live look at their business. The cloud-based software comes with live inventory and manufacturing management features, batch tracking for end-to-end traceability, a Shop Floor App for total floor-level control, open API, and a growing channel partner network. 

Real-time master planning features also automate resource allocation based on prioritized sales orders and integrations with e-commerce, accounting, CRM, and reporting services to centralize your operations in one visual platform. Sign up for a free 14-day trial here.

 

 

 

 

In a post iOS 14 world, ad costs are rising. The days of throwing up some Facebook ads and expecting dirt cheap conversions are over. So how can you scale your brand in the face of these rising ad costs and remain profitable while you do it?

One way is to become more skilled at Facebook ads and drive better quality traffic. The other is to increase your front-end conversion rate (percentage of visitors who become first time buyers), which will result in a lower customer acquisition cost.

Since I’m not qualified to speak on becoming a better media buyer, I’ll speak on the latter. Lucky for you, increasing your front-end conversion rate is faster and easier than becoming a master ad buyer.

 

Improve your conversion rate to decrease your acquisition costs

 

To illustrate, let’s say you have a conversion rate of 3.47% on cold paid traffic. At $1.18 per click, your cost to acquire a new customer is $33.82. If you were able to increase that conversion rate to 4% (and not change anything else), your CAC would drop to $29.39. This is just a 15.27% increase, and is easily doable with one of the below strategies.

When you think about increasing your store’s conversion rate, you might try improving your copy, getting better photographs, showcasing customer reviews, and improving the on-site UX. These are all effective ways to improve front-end conversions and I encourage doing all of them.

But aside from on-site optimizations and experiments, the other way to increase conversions is with your owned marketing channels. I’m talking primarily about email and SMS, as these 2 channels are, by a huge margin, the most effective at driving sales.

At our agency, we are constantly performing experiments to gain an edge for our clients. Many of these tests are contrary to ‘best practice’, but we have proven the result time and again, so I encourage you to test them out for yourself and always be skeptical of ‘best practices’ that are repeated without any data to back them up.

Also keep in mind that every brand is different, and while there are trends that work across multiple verticals, you should always test anything that has the potential to be a high leverage point in your business.

What follows are 3 of the most effective ways we have found to increase front-end conversion rates for our clients primarily using email and popups.

 

1. Implement and test your front-end offer

The majority of visitors will not make a purchase on their first visit, so you absolutely need to be capturing their contact details to maximise your chances of a sale. At a bare minimum, you need one entry popup collecting emails in exchange for some value. Depending on the quality of your traffic, you should expect anywhere from 2-20% opt-in rate on cold traffic.

The offer should be related to the first purchase so you are collecting leads with buying intent. In our experience, ‘10% off your first order’ usually drives the highest conversions and profit for most brands, but you should split test your offer because it’s a huge leverage point for maximising first-time conversions.

Some of the offers we routinely test:

 

– 5%  off first order

– 10% off first order

– $10 off first order

– 15% off first order

– Win a free product or month’s supply of your product

– Free item with your first order (preferably a high margin product with broad appeal)

 

The offer that wins is the one that drives the most opt-ins, converts the most first-time buyers and gives up the least margin. You might find that one offer drives more opt-ins, but less profit on each sale. In that case, you’ll need to decide which metric to optimise for.

In our tests, we’ve found that the right offer can drive as much as a 35% increase in visitor to sale conversion rate, so it’s worth repeating that this is one of the most important elements you’ll ever test.

 

2. Remarket with campaigns to drive longtail conversions

Unless you’re selling $2k office chairs, many of your customers will see your ad and buy on the first visit. However, there is always a percentage of customers who take days, weeks or even months to make their first purchase. These are your longtail conversions.

You can increase your longtail conversions with remarketing via ads and social media, and you can also do it with email campaigns.

Most brands are already regularly emailing their list. If you’re not sending regular campaigns, you should start yesterday. I recommend 5-6 campaign mailings per month as a starting point. We’ve seen as high as a 26% increase in conversions in month 1 by implementing this cadence.

If you’re already sending regular campaigns, it’s worth testing a higher frequency if you have the resources. Going from 5 campaigns to 10 campaigns per month won’t double your conversion rate, but it will likely drive an incremental lift that will increase your front-end conversions and make a difference to your acquisition cost.

 

3. Build your welcome sequence based on insights

The welcome sequence is the series of automated emails a subscriber gets when opting-in to your front-end offer, eg. 10% off first purchase. ‘Best practise’ advises 3-5 emails that welcome the subscriber to your brand, feature testimonials and show how your products solve your customers’ problems. This is better than nothing, but it’s not the best approach.

I’ve found it’s far more effective to build your welcome sequence according to an insight-led strategy. This means every single email in the sequence has already been proven to be effective at driving conversions.

This is how it works:

If you’re sending a regular cadence of campaigns and you’ve sent at least 10-20, you probably already have a feel for your benchmark numbers, ie. the average number of clicks and sales each campaign will generate.

But to gain better clarity into these numbers, you should start splitting your campaigns into 2 duplicate campaigns; one is sent to your customer list and the other is sent to your prospect list. Both campaigns are identical, but the campaign reporting will be separated out.

The advantage this gives you is being able to observe above-benchmark lifts in clicks and sales on your prospect list segment. Then, it’s doing 3 things:

First, experiment with different messaging in some emails. Secondary vs primary benefits, agitation vs benefit driven, and other messaging you might gain from existing product reviews, support requests and customer survey insights.

Second, observe which campaigns drive above-average results. Aside from the obvious lifts you’ll get from a holiday offer campaign, you’ll find that sometimes a campaign will drive above-average clicks and sales for whatever reason. Usually it’s because you’ve tapped into a type of messaging that really resonates. This is real time customer feedback and you will get amazing insights from this practice.

Third, build out your welcome sequence over time by repurposing those campaigns that drive above-average clicks and first-time customer conversions. By building out your welcome sequence this way, you’re ensuring the emails with the best historical record of converting prospects into customers are being sent to all new leads on a perpetual basis.

 

Remember, customer insights, not guessing or ‘best practises’, should lead your email automation strategy. This is what maximises your longtail conversions, and thus overall front-end conversion rate.

Conclusion

With all the privacy updates happening (and likely more to come), paid traffic is only to get harder, not easier, so you’ll need every advantage you can get. A lower customer acquisition cost means you can out-spend your competitors and/or scale more profitably because you have more profits from each sale to reinvest. And these 3 strategies, if implemented, will almost certainly give you that advantage.

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This is a guest post by Rod Lynn of 10M. He is the director of 10M, an agency that helps high growth, direct-to-consumer brands scale faster and more profitably with advanced email and SMS strategies. Follow him on LinkedIn or visit 10m.agency.

As cannabis business, you want to know, are CBD products taxable? The answer: yes.

Since the 2018 South Dakota vs Wayfair, Inc  ruling, the tax code declares that sales tax needs to be collected by the retailer if they are selling to another state, regardless of physical presence. The difficult part is determining how much.

A product that was federally illegal a few short years ago, the sale of hemp products is expected to generate $20 billion in sales by 2024.

What is the sales tax on CBD?

Each state (and even each county and city) is allowed to set their own sales tax rate on products. CBD oil products are no exception. Some states tax CBD as a controlled substance, while some states tax products with CBD are simply as retail product.

The tax rate can be as high as 15% and as low as 7.25%–only 5 states levy a 0% sales tax. States will also delineate based on THC level–the lower the level, the less tax applied.

Sign up for a free consultation with CFOshare to determine what your sales tax implications are. TaxConnex and products like Avalara are additional resources you can use to educate yourself.

How do you report taxes on CBD products?

The different regulations and reporting requirements among all 50 states convolutes the entire sales tax system. To avoid accidental pitfalls, the safest path is to work with a professional sales tax team like CFOshare for CBD business planning — however, there are steps you can take on your own.

Track your sales by state, zip code, and transaction amount

First, set up your accounting to determine whether your business has Nexus (see next step.) This is done by tracking gross sales dollar amount and count of orders by state. As you sell, be sure to track the location of the buyer by zip code, as most states use destination-based sales tax.

Determine nexus

Nexus is the states’ way of saying you legally have “business presence” and are required to file and remit sales tax. There are two main types of nexus: Physical nexus and economic nexus. Economic nexus can be established by a dollar amount of sales or order count. For example, if your retail shop is in New York, you have physical nexus in New York. If that same shop sells $100,000 or 200 orders of CBD all over the state of Michigan in one year, you have economic nexus in Michigan. As with taxability and rates, rules governing nexus, both economic and physical, vary by state.

How are you selling your product?

Even if you are selling through a marketplace like Amazon (who remits taxes for you), you might still be required to register and file a zero-dollar return. This is because some states still see you as a business presence, if your gross sales break the economic nexus threshold or you have physical presence. If you are selling via a platform like Shopify, which does not remit sales tax on vendors’ behalf, or in your retail store, you are required to charge tax for both points of sale.

 

Ensure proper reporting

There are dozens of pitfalls in sales tax and you do not want to be caught owing an unexpected amount of tax. The cost of failing to be compliant could result in a lien on assets, back-tax fees, and fines from various states. Colorado treats non-payment of sales tax as a class 5 felony and exacts a fee of up to $100,000 for any non-corporation. It is important to not put your head in the sand and reach out to professionals like CFOshare.

 

This is a guest post from Chelsie Kugler of CFOshare. Chelsie is the Vice President of Business Development at CFOshare. She helps small business owners improve their accounting and financial planning by surveying their company’s needs and aligning solutions internally or through CFOshare’s outsourced team.

Your product began merely as a concept that you couldn’t get out of your head. You knew your idea could solve a problem that people were experiencing. After performing thorough research, you were certain that your product could be better than the leading competitor on the market. Then, you spent the next several months or years creating the pieces, testing mockups, proving the concept, sourcing the manufacturer and designing the packaging. You went from knowing nothing about product development to having packaged goods ready for stores.

Now, it’s time to get your fantastic products into the online marketplace, inside brick-and-mortar retail stores and, ultimately, in people’s homes. How do you go about this? Through a process called “retail buying.” In a nutshell, you’ll meet with retailers to pitch your product, and they’ll consider placing an order with you.

Whether you are meeting in person or over a video call, here are 10 retail tips to add to your professional product development toolkit. These tips can help you wrap up your buyers meeting with a purchase order and let you stand out to your buyers as a beneficial resource.

1. Create Exceptional Product Packaging

Product packaging needs to do several things.

• Packaging needs to contain and protect its contents from shipping damage and product tampering.
• The packaging design needs to draw the attention of the target consumer within seconds.
• Information on the packaging needs to clearly describe the contents and explain its purpose.
• Packaging needs to conform to your brand identity. When customers see your packaging, they should not confuse it with other brands.
• Packaging needs to differentiate your product from your competitors.
• Product packaging needs to conform to the retailers’ shelving or display restrictions. Sometimes setting your product apart from competitors means having custom packaging, but if that unique packaging doesn’t physically fit on retailers’ shelves, you may not be included in the planogram.

 

2. Be Knowledgeable About Each Retail Outlet

Do you due diligence. Sure, you might want to cast a wide net to potential buyers out of excitement for your product, enthusiasm about bringing it to the marketplace or desperation to recoup cash quickly, but it’s important to carefully review each store’s vendor website for product requirements first. Buyers want a product to be a good fit for their store.

For example, if your buyer represents a store that sells only eco-friendly items, and your product is packaged overseas in plastic clamshells, don’t expect them to buy. You can either delay your meeting until you can have your products produced and packaged to their store’s specifications or move on to another retailer.

 

3. Be Knowledgeable About Your Competitors

This should be easy because this is something that you likely researched before going into production. The buyers will want to know how and why they should purchase your product rather than a similar product from your competition.

 

4. Have a Thorough Website

Your website should be a one-stop shop for your buyers. Include:

• Information about the product, how it can solve a problem, what sets it apart and how it can earn money for the store
• Product demonstration videos
• Your bio
• Customer testimonial letters, photos and videos
• Contact information
• Links to your product’s social media accounts. One in three consumers use social media to discover new products and brands, and 90% of people buy from brands they follow on social media.)

5. Keep Sell Sheets With You at All Times

Yes, your website is your product’s information headquarters, but sell sheets still have a place in product marketing. Make sure it is current, designed cleanly, and includes the product name, description, photos, website address and contact information.

 

6. Set Yourself Apart

It’s not enough for your product to be different from others in the marketplace, you need to be unique and memorable, too. What can you bring to the table that other manufacturers with similar products cannot? How can you make the buyers’ lives easier?

For example, do you own a fleet of vehicles that can expedite deliveries? Can you manufacture domestically if supply chains are disrupted and time is of the essence? Do you speak a second language? Determine what makes you different and include that information in your sell sheets and on your website.

 

7. Be Professional

Just because you have been working from your basement in sweatpants or in a warehouse in jeans doesn’t mean the whole world is dressed casually and working from home. This meeting could change your life.

• Dress like you mean business.
• Practice your presentation.
• Have printed price lists on-hand.
• Leave finished product samples with the buyer.

8. Be Flexible, Helpful and Reliable

If your buyers are having a bad month because of supply chain delays or landlord issues, be someone they can count on. The buyer might need your product packaging to be a slightly different size to fit their planogram. They might need your delivery a day earlier than you can have it ready or a day later than you need it moved from your warehouse. Be prepared to make physical and logistical adjustments to accommodate your customers.

 

9. Be Respectful of Their Time

To you, your product represents months and years of your life’s work; to retail buyers, your product is just one of the dozens of items they need to review today. Since their time is valuable, be concise while still being thorough. Don’t beat around the bush. If they are giving you 15 minutes of their time, don’t spend 10 of those minutes sharing the backstory of how you thought of the concept. They want to know what your product can do for them and their store’s profits.

 

10. Be Tenacious

OK, so this morning’s retail meeting went well but didn’t result in an order. Go home, take a breath and document all the positives that came from it. You made a connection with a buyer that you didn’t have previously, so send them a thank you note. You’re a problem solver who created a product that didn’t previously exist, so decide your next strategic move. Be prepared for some rejection, but don’t take it personally — get back out there and share your product with the world.

Inventing your idea and manufacturing your merchandise are only parts of the new-product equation. If you want to get your products into the various online and retail marketplaces, you need to know how to build professional relationships with buyers. Hopefully, these 10 tips can help. Need help from the professionals? Contact Retailbound at info@retailbound.com. They have decades of experience with conducting buyers’ meetings and launching new product brands with North American retailers.

This is a guest post from our partner Retailbound. Retailbound is a retail consultant agency that works with innovative brands that want to scale in retail.