Supply Chain Now Episode 292
For Episode 292, Scott and Greg welcomed Tom Jones with Alloy to the Supply Chain Now Studio in Atlanta, Georgia.
[00:00:05] It’s time for Supply Chain Now Radio Broadcasting Life Supply chain capital of the country, Atlanta, Georgia. Supply Chain Now Radio spotlights the best in all things supply chain the people, the technology, the best practices and the critical issues of the day. And now here are your hosts.
[00:00:29] Hey, good afternoon. Scott Luton here with you, Lavern Supply chain. Now welcome back to the show. On today’s show, we’re speaking with a Supply chain technology leader. We’re gonna be discussing big data transparency, visibility, better decision making, sooner decision making, you name it. So stay tuned as we look to increase your Supply chain Tech IQ. Two quick programing note. First, you can find Supply chain. Now wherever you get your podcast. Apple podcasts, Spotify, YouTube, you name it. Be sure to subscribe so you don’t miss a thing. Secondly, let’s think a few of our sponsors that allow us to bring these best practices and insights to you. Our audience. The Effective syndicate Vector Global Logistics. Cap Gemini, ProPurchaser.com, Talentstream and many others. You can check out each of our sponsors on the show notes of this episode. USO’s welcome in my fearless, esteemed co-host on today’s show. Greg White Serial Supply chain Tech Entrepeneur, trusted advisor and spirited lunch discussion facilitator. Greg.
[00:01:28] How are you doing? I’m doing great. Well, yeah, actually, I’m doing great.
[00:01:33] Hey, I want to give a shout out to a couple folks just real quick. Okay. Steve, okay.
[00:01:38] We’re big enough now that we can’t get people’s full names because people can find it. And, Kristie, be in love, our news segment. Okay. And we’ve, as people probably noticed, kind of deleted those from these in the spirit of not boring our guests to tears, but because you because we have done that, we have told you everything that you need to know about this week’s events. And Supply chain on Supply chain Budge Buzz Buzz, which is published every Monday. Ryan, early how early is it? Because it’s always there when I just.
[00:02:12] After midnight. Okay. No, no, no kidding. Early morning. Yeah. Because it is timely. Yeah. Timeliness. This is of the essence with that one, right? Yeah. Supply chain Buzz and its cousin series. Supply chain Budge. But at Syria. Yes. It helps you move forward in the day.
[00:02:28] So Stephen Christie can check that out. Supply chain buzz. Subscribe there. Subscribe here. Yeah, for that. And and that way we won’t burden our guests with every single news nugget every day we know with this guest here today and we’re gonna welcome him in momentarily.
[00:02:44] We of get two episodes, one with microphones, one is one without. So our guest today joined us at station side. Yeah. Awesome café here where our studio is located at King Plow in West Atlanta. And kind of unexpectedly, we all kind of met, had excellent food and retail driven to discussion.
[00:03:03] Have to confess, that’s the first time I’ve been recognized. Well, never. Thank you. You’ve captured in a whole new era. That’s right. Let’s meet this guy at this.
[00:03:15] That’s right. So our special guest today here is Tom Jones, regional sales director with Alloy. Tom, good afternoon. Afternoon. So glad to have you here in studio. We’ve had a, you know, going back to a webinar we did with Alloway several years back y’alls firms, but has been on our radar. And we’ve we’ve really enjoyed a collaboration since that point. Devoting a great blog article that you collaborated with Cindy Chao. Yes, right. Yeah, that was well received. So it’s great to have you here in the studio with us as we get to know you better. Your perspective and of course, find out what is going on. Alloy that’s driving all the growth. Yeah, no, I’m very excited to be here. Thanks for having me. All right. So, Tom, we want to start before we start talking shop and we start talking about all that really cool things that the Albertini team is up to these days is get to know Tom Jones better first. So tell us by yourself. Tell us about where you grew up and be sure to give us the skinny on your upbringing.
[00:04:13] All right. All right. Well, I grew up in Minneapolis, Minnesota, just on the west side in a suburb called Minnetonka. Haven’t gone far from the tree there. Spent my whole life in the Twin Cities, both west and east side of Minneapolis and St. Paul, back on the west side. Now, I guess, you know, what was a little bit unique about me is I’ve always really been into the math, into the numbers. So I got into computers in an early age. I was part of that generation. I don’t know if many people were. But what was your first? What was your first computer? My first computer was Commodore 64. OK. So we had that was a 64 K of memory running off floppy disks. Five and a quarter inch floppy disk. Yeah. And yeah. No, it was a ton of fun. Started building up when we start when things got moved over to the Intel Pentium chips. You know, when we are so excited, we got our first city Raam. You know, they didn’t have speed. They had speeds and then they didn’t have speeds anymore because it was irrelevant. Yeah, but yeah. So we used to build computers and then we’d have our friends over that all look over their giant monitors and big towers and like Will Smith from that movie.
[00:05:20] What are you going to APC around?
[00:05:22] Yeah, that’s a bit of happiness. Yes, he was to go on medical devices.
[00:05:26] Right. And we get like five guys in the basement. We took them all out. War game is super nerdy and there’s a ton of fun. And half the time is just like trying to get them to work, like the other half trying to play a game. You know, what was super dirty then is super innovative now. I mean, that’s you look at the folks that that started and those hobbies and the huge things are doing now, much like ELO team you in ELO team are doing. Do you still tinker with computers and build your own stuff? No, it’s it’s funny.
[00:05:54] In the last few years, I for the first time, I went in. I don’t have a personal computer anymore. All right. Everything everything is moved. And I have a laptop for work. I have an iPad. And I can do the majority of all of my personal stuff just on my phone and my iPod.
[00:06:07] Yeah. So, you know, I stumbled a little brief departure here. I stumbled on a documentary on YouTube about fathers kind of in our general age that grew up playing video games like in the 80s in Nintendo Entertainment System, Sega Genesis, all those. Right. And there evidently is a group is a very vibrant and growing community that still play those games, but they’ve got to build their own systems and and also so their kids can play it. And they’re passing it right down to their kids. Now, I know, Tom, you’ve got two young children. Maybe the youngest is too early to, you know, see maybe how they’re here. But the 5 year old has. Has he displayed he. Right. Displayed a passion for computing or all things electronics like his father?
[00:06:56] Oh, yeah, I know. He’s he’s so we we travel a fair amount and he is very excited to get on the plane because that means he gets to have a screen and he gets some screen time. So he’s devoted to that. And we recently added a console to the house. So he’s been playing a lot of Lego Ninja.
[00:07:14] Yes. Video. He’s very into the Ninjago game. And it’s amazing how quickly he went from not knowing how to use a joystick to being completely proficient with a controller. I mean, those are complicated controller with the the ability to learn and apply learn in a plan that vicious cycle is so compressed with with these young ones. These games are full of puzzles like the speed at which he developed. The ability to solve these pretty complicated puzzles on his own is astounding. So it’s it’s been really. And he can’t read anything in the game. Fives. He can’t. He can’t when the game’s telling him something to do. He’s got it figured on his own. I love it. It’s amazing. Love it. OK. So let’s switch gears now. Greg, we want to kind of dove into Tom’s professional journey, right?
[00:08:04] Yeah. So you grew up soon. You went to college, had to get a job. So tell us a little bit about that. So tell us a bit about kind of from college in and through to your professional journey until you until you landed at Alloway Sheer.
[00:08:21] Shrug of the CliffNotes I. So I was super geeky and computers loved. It seemed really natural to go into computer science. And I started at the computer science program at the University Minnesota. And I quickly understood that while I did love the program, I was not nearly as good as most of the people I was in class with. And so I kind of fell into this niche around database architecture and I got really heavy into kind of the science of information. OK. And how, you know, specifically this concept of normalizing information so that you can manage massive sets and harmonize it, make it make sense together when you were talking about millions, billions of records of information. So I ended up focusing on data architecture, got out of school and one of my first jobs was actually working for U.S. Banquo’s, doing automation around, pulling data from their corporate trust systems and then processing redemptions and some other things. But I was able to develop programs that automated all of this based on the data in the customer records. And they just kind of got hooked on it. So I started building an access start building an SQL server moved over.
[00:09:33] And then kind of the most relevant experience that was that a company called Pensione Software where we had a product dispatch office that was this back and management system as well as like a courier system that managed, you know, it would allow you to dispatch jobs, track packages. And it morphed over time into this warehouse management system. It would optimize picking it, packing and routing. It was a really amazing system. And while I was doing that, I started. Getting much more into, OK, the so-what like you’ve got all this information, what do you do with it? And I started, you know, working more and more closely with the business teams, with the finance teams realized I wanted to get that next layer. And so I went back to the university Minnesota, got an MBA, really focused the MBA on finance and came out and moved over into BestBuy. So I was on the finance team supporting the entertainment group. Got it. Which at the time was about fifteen billion dollar or four music, movies, video games and musical instruments, gadgets and e-readers.
[00:10:33] So roughly years. What years?
[00:10:37] So that was let’s see, that would have been 2010 to 2012. OK. So I was supporting the entertainment team for not that long, but it was phenomenal because we were building out all these really robust data tools to help them with promotional forecasting, understanding. You know, things like cannibalization as we launch new products and how that affects other items in the categories. Yeah. Dealing with demand constraints, supply constraints, store closures due to weather events and trying to understand every single day. OK. Now this happened. What does it mean? Now this happened. What does it mean? Is this a trend or is this a blip? Right. And if I pull this forward, you know, six months or to the end of the year, how materially is this going to affect my top line, my bottom line? And it was just this brand new modeling exercise every day. And while I was doing that, that’s when I got tapped on the shoulder.
[00:11:27] And I learned about this company called Anna Plan. Right. Which is where I got spend the next seven years of my life, which was phenomenal rocket ship startup out of San Francisco that has really taken the planning world by storm and really a platform play.
[00:11:42] I mean, very much so. I remember because we sort of peripherally competed with Anna playing at Blue Ridge, but really a very cool tool set in that it kind of allowed you as an as a individual company to take the core functionality in the data management of an airplane and turn it into. And I don’t want to say customized. Yeah. But it really kind of create an application for specifically for your environment. It was a great jumping off point and you could really serve sales.
[00:12:13] Finance, UPS. Supply chain marketing. Yeah. I mean, it was a tool that really could be position to serve a lot of different customers within the org. Very collaborative too. Yeah. So yeah. So very exciting to be a part of that rocket ship. I was an early employee. Twenty five and then I was there until they’re about thirteen hundred fourteen hundred people. Wow. Yeah. We went public. It was a great story as a ton of fun. I made some incredible friendships. It was an amazing story.
[00:12:40] So what is one thing when you’re employee number 25 and it grows in short order to that magnitude? What’s the one observation when I picture myself, you know, kind of know, one, what life is like in a team full of 25 folks and then when it’s overnight, fourteen hundred or whatever that number was, what was one take away from that experience kind of seeing and being a part of that that type of growth.
[00:13:09] The thing that took me by the most surprise, I think, was that like you meet some incredible people, amazing skill sets, and you find that these these approaches and these skill sets tend to be suited really well for specific stages of growth in a company. There are a lot of people that like to wear a ton of hats and do really well across a broad range of subjects, but they don’t want to go super deep, whereas you have other people that they get a lot of energy out of being the the best. They want to go the deepest. They want to be the expert and they want to find those opportunities that nobody else can find. And different skill sets are needed for different stages of growth. And you know, what I found personally was as we grew the company, I really got a lot of energy out of that early stage. I wanted to wear a lot of hats. I wanted to be able to play in a lot of different arenas. And, you know, the bigger you get, the more you have people specializing and focusing. And so, you know, I started out you know, when I moved from I was more of a sales engineer when I started, I moved into a field sales role. I had hundreds of accounts. And when I left, I had three ads, really specialized. Really specialized. I mean, it was tough to fun the customers. I had remaining customers. But, you know, I I took the leap and I joined Alloy and I went back to. You know, I own half the country for the Enterprise segment and I’m doing biz dev and strategic alliances work. And, you know, I’ve got a seat at the table where I get to work with a lot of the other people in the company really shaping the future. You know, I’d lost that ability and a plan, and that was something I really enjoyed. So now I have an opportunity to that again.
[00:14:48] I thought it was really interesting, your title, because the instant question that I had was what region? Because you’re in Mint, Minneapolis. But we’re in Atlanta. And this is also. Region. You met with a customer before you met with us. Correct. Greene prospect, right. So are you basically I mean, Minneapolis’s right at the right at the beginning of of the Mississippi River. So you can’t even say you are Mississippi, east or west because right there where. It’s a it’s a trickle.
[00:15:17] Right. So which part of the country is your part of the country?
[00:15:21] So, I mean, it is a trickle, but we do have a really high concentration of Fortune 500 CBG Ryder. Yeah. And it’s the home of the Post-it notes. That’s right. 3-0 are in our backyard. So. Yeah. I mean regional doesn’t mean as much as they used to, right. Yeah. It’s sure I’m in Minneapolis but if I were to cover Chicago or I cover San Francisco, you know, I get on a plane and I’m there. You know, I’m in Chicago in an hour or I’m in San Francisco in three. So it’s not it’s not that big of a difference anymore.
[00:15:50] But generally, are you pretty much east of Minneapolis?
[00:15:53] So, yeah, it keeps changing. So the faster we grow, the the more we hire into the enterprise team. Obviously, the smaller the region’s gonna get for me. Right now, I I’m mostly kind of north central and then I’ve got pockets. We just hired a new team, new member Melodee out of Philadelphia. And so she’s taken more of the northeast and we’re doing some round robin on the west. I’ve got a lot of the west to go. We’re how we’re gonna get somebody out in San Francisco, probably in three. I think the goal right now is to have six to eight by the end of the year. And so I’ll just keep getting circumscribes smaller. But I mean, it’s it’s the nature of the growth. And frankly, it’s hard to focus on more than, say, 20 to 40 accounts at any given time anyway. So it’s it’s it’s fun ’cause you get to pick your opportunities in a way that you really get to optimize for the types of businesses and kinds of customers that want to be leaders. Right. Yes. I saw on social media this morning, but this quote that really landed with me, which is to lead, means you can’t do something that other people are doing. So when you find a customer, that’s like, OK, well, who have you done this with before? Because I only want to do it. If you’ve done it with others, then by definition, they don’t want to be a leader in the space. So you’re finding those leaders that are ready to do something new in order to achieve something new.
[00:17:09] Is that where I mean, is that. So I think this is a good lesson for our our audience. Is that the kind of company that you’re landing with is is are early adopters or fast followers? Is that.
[00:17:20] I think that’s that’s true. I mean, we certainly have some of our platform is very tried, tested and true. We’ve been doing it for years and we’re continuing to build capability on top of that. And as we mature in the Supply chain space, where we’re going to be spending the most of our time with our enterprise customers, that product is innovating and rapidly. And it’s one of those things where it’s not even necessarily that the company is doing something very new for us. We’re a startup. So, you know, everything’s new for us. Yeah. But the big thing that we’re seeing is the enterprise consumer products companies, consumer tech, you know, even food. They’re not used to leveraging the granular daily information that we’re bringing to the fore. And so they see it. They know they want to do something with it, but they can’t quite make the connection. Okay. Here’s how I convert that into dollars on my bottom line.
[00:18:15] That’s how you that’s how they they can’t see how to get to the. So what? So. Right.
[00:18:19] So and then by definition, they don’t have teams that do it.
[00:18:22] So give us an idea of what Alloy Snow asked.
[00:18:26] You read my mind that something that’s perfect.
[00:18:28] Well, yeah, I think we have a good idea of who you’re approaching, but give us an idea of the application, the solution, the business problems that you’re attacking. Because I think that’ll help the audience tie it together. Who is early adopting her fast following on, you know, I mean, and what problems are they trying to solve? Sure.
[00:18:51] So the customers that are getting a ton of value out of our platform are customers that want to go out, you know, their brands that are typically selling their products on the shelf at retail. Right. They maybe they have e-commerce, maybe they have direct to consumer in some cases, maybe they just have a really strong B2B business. But essentially they have really, really robust retail sales and they’re getting information from their customers, the retailers, about what’s selling off the shelf by SKU, by store, by day. They’re getting retailer forecasts and they can see their inventory at the stores. They can see the inventory at the retail d.c’s. Obviously, they know their own inventories. They see the orders and the shipments flowing back and forth. They have all this transactional information and it’s just this mountain of data. And they know that they should be doing something with it. Right. They know sales uses it ad hoc. They they use it to analyze promotional effectiveness for specific promos that they’ve run or new products that they’ve launched. There’s some level of in-stock analytics where they’re trying to react when they see that a store is out of stock. An item you see Supply chain CPF, our teams, they’re working closely with the with the retail teams.
[00:20:07] So it’s going to ask you to define that outside.
[00:20:09] So far. Sun Some segment of our listeners, you know, we love our acronyms and supply chain. Yeah. So tell us.
[00:20:16] Yeah. Rain Man, Ramia. So CPF, our collaborative planning, forecasting and replenishment. So these are, you know, the members of the Supply chain that are really working closely with the retailers to make sure that those shelves stateful.
[00:20:28] Yeah. Right. So this was a concept introduced to retail by Wal-Mart. Where are they? I think first with PMG, which is also one of your customers. But we can say that.
[00:20:37] I can say that maybe you can. And I actually have a public video. Yeah. Yeah.
[00:20:42] But the goal was to combine and share information, which seems so natural today. But in whatever the late 90s, early 2000s when Wal-Mart was doing this, this this concept of collaborating between companies was absolutely unheard of. You know, it was more trying to block your vendors from stealing your downstream customers. Your consumers and companies have finally realized that this sort of openness and sharing is really it’s really a creative to both.
[00:21:11] Of course, Wal-Mart was definitely on the vanguard in terms of sharing this type of information with their vendors earlier. Right. And what we’ve seen is that almost all of the major retailers have gotten on this bandwagon because a rising tide lifts all ships. They know that if they’re sharing this information with the vendors, the vendors are gonna use it to improve their business, which in turn improves the retailer’s business. Right. It’s not really at the expense of anybody.
[00:21:36] What’s interesting to me is you see the retailers getting more and more sophisticated with this data, too. There was there was recently an article in the journal about how grocery is now getting somewhat value out of this information that it’s there basically, you know, lessening the value of the category captain role in store. And they’re saying, I know that that you are giving us great advice as a partner. However, we are now really good at using this information, too. And we’re going to basically leverage our own insights and maybe it’s going to be at your expense.
[00:22:13] So the the so I’m sorry, another arm category, captain.
[00:22:17] So these are at least in my vernacular, these are the merchandisers from Frito-Lay or Coca-Cola or whomever who go in and say you need 50 of these and twenty eight of those and three thousand of these.
[00:22:28] So I think, you know, they’re going to play a really active role with the retailer and understanding. Here’s what the assortment should be. Right. Right. Not necessarily. These are the SKUs from my competitors you should carry. But, you know, this is how much product you should carry. Here are the price points where we’re expecting that the customers are going to want to be at for the different types of product. Right. You know, here is is the breadth that you want to carry. Right. Because these consumer products companies have such an enormous portfolio. They’re not really now. Yeah. Especially now, you know, and the brick and mortar is in a tough spot because the retail stores, they can’t carry that kind of variety that you can get online. So they have to compete in other ways. Right. But they also need to have the product. The customer is looking for. Yes. And so the category captains are gonna help in managing that for the retailer.
[00:23:19] But the retailers are taking more, more initiative in themselves and they have a closer tie to the data that enables them to do so today. They have. I mean, they can actually advise these big brands in the category captains. No, no, we don’t need 50 of those. We only need 37.
[00:23:38] Well, and they’re also often carrying their own brands. You know, they’re often selling their own products on the shelf next to the vendors. Right. So, I mean, ultimately, I think where this is going is for you to be a competitive vendor in that store and to get that retailer to say, you know, I really value the insights that you’re offering. You need to have better insights than you’ve ever needed to have before. Because you have to outdo the retailer who has way more data than you do. Yeah, but there’s a there’s a really key component of the information that you have that the retailer doesn’t have, and that’s what’s happening at other retailers. And so, you know, the foundation of alloy is essentially, hey, we can help you get all of this information from retail and we can get it from all your retailers and we can put it in one place for you. So now you have this comprehensive view of how your product is selling in all major channels.
[00:24:33] You can combine it with your director, consumer business, your e-commerce businesses. We’ve made it simple to take, you know, e-commerce data from an Amazon or a Shopify and look at that zip code level data and combine that with the zip code level brick and mortar sell through so you can see hyper local sales performance regardless of channel. And all of that’s phenomenal because now it gives the brand something that they can bring to the table that. Retailer cannot get on their own.
[00:25:01] Right. So when you’re making a case about why you want the retailer to behave differently, you have information that they need in order to run their business more effectively. And they have a reason to listen to you. That’s that’s beyond just I know they want to sell more of their products.
[00:25:17] Right. And you wanted what, you anonymize that data when you give them that analysis so that it’s not like they know this is Wal-Mart’s data or any of that. Right. It’s just they have they have the ability to assess a macro view of the marketplace and how they kind of land in the marketplace. Exactly. Fair estimation.
[00:25:36] Yeah. Yeah. That’s very fair. So we’re gonna make it easy for the the brand and the manufacturers to consume this information and present it back in an ethical way. That that’s not going to show one retailer how this product is performing in another retailer, because that would not be appropriate. However, when I’m looking at regional performance and I can see this product is performing at a certain level and it isn’t performing this way in your locations, and we have some theories about why. You know, I’ve got hard data that supports you. It should be doing better or, you know, gosh, you guys are doing something incredibly special here that I can’t replicate elsewhere. Help me understand what you’re doing differently. And then we can bring that either to other of your stores in different regions or we can bring that to bear, you know, to make this a stronger offering as a whole.
[00:26:24] So, Tom, let’s let’s talk about part of our pre-show discussion was around the need to respond sooner and faster, including I liked the quote you brought to the conversation, the right response the first time. Why is that important in today’s environment?
[00:26:43] So, yeah, so we get really excited about when we talk about the granular data that’s available. We’re not just talking about SKU and store level data, we’re talking about daily information. So for a lot of the major retailers, you can now get sell through an inventory refreshed as of the close of business yesterday. And what that allows you to do is allows you to start analyzing not just, hey, I’m out of stock and I’m losing sales. And here’s where let’s go try and force them to put more on the shelf. But it allows you to execute better in the middle of things like in the middle of promotions, for example. So if I’m running multiple promotions and I’m starting to run dangerously low on inventory in key areas or with key products, I have visibility in the middle of the promotion when I still have an opportunity to do something about it. Right, without having it have to be somebodies full time job to monitor that data. Right. Because now even though there’s reams and reams of information coming at me, I have basically machines that can go monitor all of this. I can give it some key insights about what to look for and find those signals that are on those signals.
[00:27:56] Exactly. Exactly. And it’s not just, you know, hey, I’m going to be out of stock in a couple of days. We’re talking about being able to see okay, here. Here’s how the top quartile of my stores are performing. Where are my bottom performers that I know are executing this promotion? And let’s send field agents out and arm them with the kind of information they need. Like they need to have displays up in the stores. They’ve been sent, the displays they were sent the product. I see that it was on hand two days ago, but they haven’t been showing the lift that our other stores are seeing. Did the display get set up? I can now give people specific stores. I can tell them which SKUs should be on those shelves. In what quantities? How many facings, how deep. You know, and I can start to diagnose problems. Like what? Maybe that product didn’t get to the store in time. Right. And I can try to troubleshoot that instead. So it just it gives the teams an ability to execute with the information that supports the action they’re trying to take in a way that they’ve never had before.
[00:28:59] What? So what is as far as I’m Parap in my head around what Allaway does is is the company in your solution a better fit for retailers with hundreds of stores or your work in it at folks with a handful of stores to, you know, the Fortune 500? What’s that customer profile likely to question?
[00:29:19] So, first of all, the retailers that we’re typically working with, you know, they’re not typically our end customer, but they are who we’re getting our information from the data that we’re getting. In fact, they’re the customers of your brands. Exactly. Exactly. Right. So you go out, you know, we’re gonna get the best data from your target’s, your Wal-Marts, your best buys, Home Depot, Lowe’s, Costco, etc. So that that kind of top national retailers, North America and globally, they have the most robust information available at really good levels of granularity to action off of the customers of ours that are going to get the most value out of that.
[00:29:53] You know, we serve two segments of the industry. We serve kind of the mid-market. These are companies that are. Going to be doing anywhere from, say, you know, 5 million up to a few hundred million in sales. They are still relatively young companies often or at least relatively small companies.
[00:30:08] You’ve got teams that were a lot of hats for those companies. We’re going to work really well in the sales teams and helping them execute, working with buyers and managing the execution, the actual supply problems that sales has to deal with quite often in those orgs. When you move up into the enterprise level, companies are doing, you know, billion plus in sales. A lot of times you see those roles get split out. And so you have the sales teams very separate from marketing from. From the Supply chain. Supply chain is broken out between demand planning, supply planning CPF our teams. And so you end up with much more siloed solutions in those existing companies where we find the most opportunity. There is much more on the supply chain side. And so, you know, the offering there is kind of unique in that where we focus on the sales story, understanding leaders and leaders from a SKU perspective, top quartile performers and making sure we have high in-stock rates to capture all the growth that we’re seeing. Right. That’s the story on the mid-market. More so on the enterprise side. We’re selling the same products, the same razor to the same customers over and over and over again. Right. We’re innovating maybe annually or more often, but we’re rolling the SKUs over. And for the most part, I’m selling the same kinds of product repeatedly.
[00:31:23] So the opportunity there, even in the sales org’s of those businesses is to execute better. And a lot of times the room for better execution is in the supply chain. And so where we see the opportunity strictly in the supply chain for those enterprise customers is in visibility first. And then how do we drive action from the information we’re getting out of that visibility? So when I combine all this information I’m getting, I combined I take all this retail sell through information inventory. I start to look at, OK, what what is unconstrained demand look like? If I were in stock 100 percent of the time, how much would I sell? Therefore, how much opportunity is left on the table? And I translate that back to the retail d.c’s, to my d.c’s, my plans, my suppliers, and then I can synthesize all of that across my retailers into a view that shows me, OK, here’s my health at each node, right? Each point in the supply chain, I can judge its health by how much product do I have? How quickly is it moving? What does my forecast. All right. So basically, how long is it until? How long is going to last? Right. What is my risk and what’s my appetite for risk? Yeah, because, you know, maybe I want to have a hundred percent on shelf availability.
[00:32:36] And so I’m going to carry 50 weeks of supply no matter what. All right. But finally, the retailer. That’s OK with that. Yeah. Right. That’s got room in the back to let you have 10 times what they would let any other brand have.
[00:32:46] Because that’s an exponential curve. Right. I mean, if you if you want to look, let’s say you want to be in stock 97 percent of the time, it’s an exponential change in inventory and cost. Yeah. Right. Not not incremental. Now you look at you could you will more than triple your inventory usually to get from 97 to 100 or even ninety nine point nine.
[00:33:08] Well and you look at like a Wal-Mart, they’re going to manage you to a you know, a ninety eight percent. They don’t if you’re over that number, that means they’re spending too much. That’s right. That’s the way they’re gonna see it. Right. But, you know, oftentimes you get you fall into this trap, right. Where I’m not able to keep it on the shelf, which depresses myself. Yeah. My depressed sales cause their algorithms to forecast that they need to buy less product. They buy less product. My sales go down further. Yeah, because I have empty shelves. Yeah. And so if you’re going to make profits. Exactly. And if you want to break out of that, you need really strong data to go to these retailers and say, listen, I understand why your algorithms are saying what they’re saying here is data that supports what I’m saying. Let’s try it. And if it works, then we’ve proven the premise. And by the way, we both benefit.
[00:33:54] Yeah. Yeah, that that’s powerful. Right. And it’s powerful to be. I think the greatest power that you guys deliver is the macro knowledge of the marketplace. It because a retailer can only see if the possibility of their sales in terms of their perspective. But when you give them an additional perspective that says somebody selling 40 percent more than you are. Whatever that number is, that suddenly opens their eyes to a greater possibility for that for that product than that. Again, as you said, all with all boats rise with the tides.
[00:34:28] Well, a lot of times we’ll have customers that have their own retail. So we have customers like Bose or Valvoline that have their own channel to sell through. And it’s not even necessarily I can show you, you know, I’m never going to go to a target and say, here’s how is performing to make my case, because not only is it unethical, but you’re gonna get door slammed in your face. Yeah, right. You need to be able to present a nuanced message in a appropriate way. And what you’re trying to say is, listen, I know that this product can perform better. We’ve seen it. Here’s aggregated information that supports my point. Your specific information that supports my point right here is something very targeted that I’m saying. My hypothesis is if we can push product to these stores in these quantities, you’re going to see this. You’re gonna see this result. You know, we’re going to increase our sell through by X is going to pay for it. It’s going to justify it. You know, whether it’s because we’ve identified those locations, have phantom inventory, whether it’s that we’ve identified that the DC isn’t replenishing correctly. Regardless, you know, we have a hypothesis. We have a way to test it. We have a way to manage it and measure it in order to determine was it successful? Are you gonna trust me next time I say this?
[00:35:38] Yeah. All right. So before we take it, you know, take the conversation a little more broadly. Broadly, right. I always will say broader, but that’s not it. Broadly, let’s talk about where you spend your time. Clearly, strategic alliances are her business development. Clearly, spend a lot of your time with current customers, prospective customers. What where else? What it what it will. What are we not thinking about? Where where Tom Jones spends a lot of his time.
[00:36:07] So, you know, I was savin to try and spend as much time as I can with my customers. And basically, you know, maybe it’s not great word for it, but evangelizing this message on the road. Right. I want I want brands to understand that you can change retailer behavior as long as you have a message that resonates with the retailer. Right. They want people that can give them something new. Right. They’ll give you the time of day as long as they feel like you’re bringing something to the table. And that’s what Allawi’s doing, is it’s giving you the information that lets them do their job better. Because now you can do a big part of their job for them and they trust you to do it.
[00:36:45] It’s a defensible business case. Look, I’ve been a merchant at a retailer, right? A vendor that was valuable to me was not one who said, I know you can sell more. They were the ones who said, I can prove you can sell more. And what you’re enabling those those suppliers to do is create that defensible business case that says, I can prove that you can sell more. And that is so incredibly valuable to a retailer, because even P and GS SKUs are just a handful of the SKUs that any merchant is managing.
[00:37:14] I mean, I manage 4000 SKUs in seven hundred stores and SKUs sorry, stock keeping units, different items, SKU, SKU, you refer to folks like that that are listening and not watching this on you.
[00:37:31] Yeah, that’s right. Greg was just picking up all kinds of devices.
[00:37:33] Yeah. Yeah. Right. So. So that that’s valuable to me because I can’t focus enough. I personally and even a retailer can’t focus enough on any vendor’s particular product line because we have you know, among among the 4000 SKUs, we might have a thousand vendors. So it enables a level of effectiveness that is impossible, literally impossible for a retailer to to achieve. But it does so in a scientific way by presenting this sound business case that allows me to have the confidence or at least start with a level of confidence that I can build on to to see that there is opportunity greater than what I see today.
[00:38:16] I think, you know, one of the other things that we’re doing that is, is really a big challenge on the market right now is convincing customers that our brand, the brands, companies that are selling at retail, that they can do this, not just that the retailers will listen to them, but for a lot of our customers. When you come at them with this massive amount of data and you’re saying, listen, I can synthesize this and I can give you insights, I can tell you exactly how to act on them and how to make money doing it. I can tell you what the what the demand side of the supply chain with the supply side of the supply chain should be doing how they should be interacting with sales. This this isn’t a muscle that they have, how they can leverage this SKU store day data in an effective way that allows these teams to collaborate daily on this information. Right. I’m not saying that they don’t have access to the daily information. I’m not saying that the teams haven’t developed their own processes to use the daily SKU information. What we’re doing that’s different is giving them an ability for all of these teams to do it in the same place at the same time and act faster because they’re not all coming to the table with their own report.
[00:39:25] Right. So coming back to the question you asked earlier, this was, you know, how do you react faster and how do you act the right way the first time? How do you react with the correct response? Right. It’s you got to have the most granular data. You have to have had it crunched before you start using it. Right. It’s not enough to just run a report. Then I’m going to process my pivot tables and then I’m going to run my my analytics on top of that. It’s going to spit out some answers that I’m and try to understand them. No, you you should come in in the morning. And the insights are there for you to go through. Right. And then it’s a matter of prioritizing, it’s triaging the information because I guarantee you you’re a big company like you don’t like a P and you’re a Unilever and you produce this report that says, OK, I want to see my auto stocks. Right. And I’m selling in 20000 locations and I have a skew portfolio in the tens of thousands. That’s gonna be a lot of intersections. It’s not really a tweet. No. Like I can’t act on that. Right. So what you need is you need that second question.
[00:40:27] The second question is, OK, well, I want to narrow it down to the ones that are actually losing me the most money. Yeah. Start somewhere. Right. What are the ones? Not only that are that are presenting the greatest lost sales issue. And I want to prioritize by lost sales, but also the ones I can do something about. Right. If I’m if I’m losing sales because I have phantom inventory. OK. I need to send somebody that store or I need to pick up the phone and I need to make my case that that store is incorrectly counting the product in the back and on the shelf. If I’m telling them that it shows that they have 0 and there should be one, they’re not going to care. But if I can show them that they are losing $10000 a week in sales because it won’t replenish their attention. Exactly. Exactly. If I have a team of field agents that are going out and doing in-store visits and they have a prioritized list of actions to take based on the amount of value each action creates, then I am all of a sudden using these field teams multiple times more efficiently than I was before when they had a static list of action. Right.
[00:41:30] You know, I heard, I think, helpful context for some our listeners that may not be familiar with the retail environment. One of the world’s leading beverage producers, I’ll call it, went in and heard their one of their continuous improvement leaders speaking. And he mentioned how, you know, when a customer goes into a store and doesn’t find the God, they’re gonna do with my typical terminology. All right. We call all soft drinks the S Coke, right? ABC Cola. Right. And if the customer on their mind wants, you know, an ABC Cola today. But to your point that the aisle is empty. All right. That is a sale. They’ll never get back. Right. Is lost for good.
[00:42:18] And I think that’s that’s important context for. It’s not like they can come. They can rely on that customer coming back the next day when they’ve got product or three days later, that’s just completely lost revenue. That s an important thing to embrace when we’re talking retail. Right. Yeah.
[00:42:35] You know, I was reading one of the the summaries that actually you wrote earlier, Greg. You know, demand is not just what’s purchased. It’s also what’s desired and not purchased. Right.
[00:42:45] Right. And it’s a Sheer words. Those are your words. It’s Greg.
[00:42:50] It’s lost sales. Yeah. Right. It’s not just the sales you made. It’s the sales you lost.
[00:42:53] Right. And we refer to that as true demand. If unconstrained demand and I mean, certainly you need to make some adjustments. Right.
[00:43:00] Sometimes if I can’t find the six pack, I’m going to buy the 24 pack, or I might buy a new leader or a different brand or I might buy a different brand. Brand. Yes. Right. But you can make some assumptions based on, for instance, if you have SKUs, store day level data. And I can see that I was out of stock on an item. I can also see how the rest of my items in that category performed when I was out of stock. Right. And you can make some extrapolations from that. Right. And I can do that in aggregate, because now all of a sudden, I have a very instant way of saying, OK, how did this category perform at all stores that were out of stock in this item? And so my sample set isn’t one. My sample set could be dozens or hundreds. Right. And I can say, OK, I want to check that on this day, but maybe I want to check it on all Tuesdays over the last four weeks. Yeah. Like I have this immense ability to pore through the data that I never had before. Yeah. Right.
[00:43:53] All right. So now let’s get a bigger picture. Right. As we start to wind down the interview with Tom Jones, regional sales director with Alloy. All right. So if you think of the global in Supply chain community, although we’ve been told that in the end Supply chain is dead, all things are circular economy, which which we’re big fans of. But speaking, speaking, losing terminology, I’m upset in the end, just about a million times my life, I’m have to strike that that it’s not right for that long.
[00:44:19] Right. It hasn’t even been the end to end supply chain for that.
[00:44:22] That’s an excellent point. So when you think about the global supply chain industry, what one or two trends or topics or challenges or issues are you tracking more than it looks right now, Tom?
[00:44:36] So, I mean, some of the things that we’re really focused on is how much the retailers are sharing with the brands. Right. So the trend has been that retail is providing more and more data back to the brands to help them basically do the work that the retailers used to have to do. Right. So they’re they’re essentially outsourcing. A lot of their supply and demand planning to the brands and they’re saying you get to do it as long as you do a better job than we can. But now we have incredibly good tools to measure whether or not you can actually do a better job than we can. You’re seeing retailers not only share information about sell through, but you’re you’re they’re sharing information about did you deliver this to me on time? Did you deliver it to me in full? Right. Did you short ship me? Did you give me what I asked for? That’s really important because as that access to information has increased, so has the penalties that are levied on the companies that aren’t able to serve. According to the benchmarks these retailers have set up. Right. So you’re seeing increasingly more retailers levy these fines on brands that are unable to meet the requirements laid out by the retailers. So now all of a sudden, it’s not enough that I anticipate what demand is going to be. I have to do that in concert with meeting the very rigorous demands of the retailer or my margins get even lower regardless of what I was going to sell it for on shelf. And then we’re seeing the continued globalization of this. So North America certainly has been leading the charge in terms of sharing this kind of data with their vendors.
[00:46:12] But more and more, you’re seeing the other regions catch up. Europe is is very far ahead in this as well. And as the other global retailers kind of get up to speed with sharing, making it very easy to access this information and use it, you’re going to see. But enormous flood of data compared to even what we have now. Come on the market and you’re going to see these global retailers trying to leverage it all together and you’re going to see these global brands leverage it together as well to keep pace. So, you know, right now you have a lot of different business models, depending on which region you’re going to market in, whether you’re operating through wholesalers, distributors, whether you’re replenishing direct a store where you have a direct consumer business. And, you know, you’re going to see over time more standardization of these models as globalization continues, which is going to require a whole lot more power behind it to make it effective. But it also means there’s a lot more opportunity to standardize, develop best practices and scale it up super efficiently. So I think you’re going to see more data, which is a prediction anybody can make. That’s not going to be unique, but you’re going to see even more opportunity come out of that as long as you’re leveraging the kind of tools that can turn that data into not just insights. Right. It’s not just a reporting exercise, but really focused on, OK. It’s not enough to know it. I have to know what to do with it. And then I have to be able to do it. So how do I prioritize against where I can actually move the needle?
[00:47:43] Well put.
[00:47:45] Right. They’re begging for me to say so. Well, after. Look, look. I think ya like second cousins or third cousins. Espace at Tom speaking to is one your areas of passion and expertise.
[00:48:01] You know, four down one layer. Right. They work with the brands and and the manufacturers. Right. If you move down one layer to have distributors and retailers. This this is precisely the solution that my company, Blue Ridge delivered and delivers to to that tier of the enterprise and business problems. You know, I’m probably look like a I’m thinking because I am. I’m thinking I’m taking notes here. But, you know, the the business problems are not the same. The access to the consumer is vastly different. That’s that’s the differentiating factor, by the way, that you stay on. And that and the difference is that the the retailer and the distributor have the transaction. You have P.O.S., which is only slightly different. Right. At point of sale. Point of sale. Thank you.
[00:48:51] Sorry. But the problems are remarkably similar in it. And this goes to a philosophy that I have is and we talk about here frequently is that I think retailers should spend more time focusing on what they’re really, really good at. And that is the interaction vis-a-vis marketing and merchandising and and product mix management. And and leave the back office things that most core leadership entities or leadership teams of most retailers really don’t have that much interest in until Supply chain has got a seat at the table. Right. They really are really very good at marketing and sales and and merchandising. Right. And and category management. But this allows them to put more and more responsibility on someone who not only has their best interest at heart. I mean, arguably, you could say most vendors do nowadays that wasn’t always the case, but also has a larger viewpoint on the market as a whole. So it’s interesting, this dynamic. And. How it impacts and I think also you. To your final point, which is, you know, take the data and and do something with it, not just present it. I think that I know that that can go a lot farther. You guys are well equipped to be able to do that, to not just take the data and say bluh. Here’s what we found. Right. But take the data and say, here’s what we recommend. Or even, you know, with the advent of of RPA, which is automated process, you know, write about a process, automatic process automation.
[00:50:38] Right. So is like you. I couldn’t remember what the RR was. That’s embarrassing. But to take that and actually do it because you’ve got the parameters, you understand the business rules of the of the business partner or the company that you’re working with. Well, that will be coming very, very quickly.
[00:50:55] Well, I think you bring up a really important point, right, because we are vertically specific. Basically, we’re super focused on on brands and manufacturing. It allows us to build into our foundation, basically the platform itself, the the viewpoints and the way that you need to look at a business for this specific vertical. Yeah. When you are a general purpose be-I tool, for example, it’s you’re you’re reinventing the wheel over and over and every single customer.
[00:51:24] And one of the interesting things that we heard back to kind of responding faster is the marketplace place is changing rapidly. What we’re hearing and you know, we had a great customer, one of our best customers that we’re talking to recently, and they said, you know, before Alloway, we were really planning based on sell in the product that we were selling to a retailer. And that’s that’s what we based our planning on. We placed it on the orders that they placed and we want to make sure that they were filled. And we you know, basically we had to trust that they were gonna get it out to the shelves the way that they do, which is their core competency. Right. Getting the products on the shelves. Yeah. And they said that when we were doing that, it was we were too late. When customers patterns and behaviors were changing, we were we would be able to see them on the shelf. Once we had Eloi, we were able to see that behavior shifting, the demand patterns changing. And we can react now when customers buy differently instead of waiting until it flows through in an order which could be weeks or months after the fact, depending on how much inventory a given retailers carrying on shelf or in the D.C..
[00:52:25] All right. So Malcolm shopman, you got. Already we have 17 folks lined up waiting to speak with you about their retail woes before you even leave Atlanta. So, Tom, this is clearly what I admire about this.
[00:52:38] 15 of them are consumers. True. That’s right. Right. They’re not they’re not even just the brand retailers.
[00:52:45] What my what I like about this is you can tell and listeners might not be able to see it as much, but get the bill to hear it. This is your passion about this stuff. You’re on a mission and you are. This will help. This will help arm you with the data that you need to grow your company and grow your sales. And and we’ll get a million stories that I want to share. Yeah. I mean, we’ve got so many glub customers that are doing just amazing things with this information. All right. Let’s do this. Let’s make sure our audience knows how to find those stores. We’ll find Alloy, which is getting less and less difficult these days as we all continue to to take over the world, but less. How can they find Alloway and how can they connect with you?
[00:53:29] So definitely come to our Web site, Eloi Dot a–i. We are we’ve got a great site that I’m looking to use put together, obviously lots of case studies, lots of information about how the product works and who we best serve to get in contact with me. You can reach me at on my LinkedIn profile, connect with me. I would love to. I’d love to share more of the story.
[00:53:50] Tom Jones, regional sales director, Eloi. And I think you’re going to mention you’re going to be at a big event.
[00:53:55] Yeah, that’s right. Yeah. So at the beginning of May, we are going to be in Orlando with the Gartner Supply chain Symposium. And we’re going to have one of our amazing customers, Ferraro, V.P. of Supply chain. Ferraro is going to be speaking yummy with our with our CEO Joel Biehl onstage Monday afternoon. And we would really encourage people that are interested in looking at, you know, how does a company like Ferraro use a tool like Alloy to combine their inventory data with their distributors data and the retail data to tell a picture that’s there, to tell a story that says, you know, here’s where the product needs to be. How much of it needs to be there when it’s going to sell? Because they’ve got you know, when you’ve got a consumable, they are paying extremely close attention at inventory to make sure that it doesn’t spoil and get thrown out in the trash. So huge value story then. Definitely. And that’s got me in Orlando, right? That’s right.
[00:54:51] All right. As a hyper focused supply chain show by my Griswald AGA.
[00:54:57] Yeah. Even more focused than the old supply chain exact. Live conference in in Phenix. So it’s a great place for practitioners as well, a leader theoreticians. Yeah, yeah. And leaders to me.
[00:55:12] Yeah, I think they changed it to the symposium so that they could have a bigger format. And they’re just getting oversubscribed. Yeah. That’s right.
[00:55:19] Yeah. OK. Tom Jones, regional sales director with Alloy Alloy Dot A.
[00:55:23] And of course, Phon Tommo linked in or at the Gartner Supply chain Symposium in Florida. Coming up in April. Right. First week of May for with, say, urban. Yeah. Secondly. All right. Good stuff, Tom.
[00:55:35] We’ll played it on. It’s a pleasure to have you here in studio.
[00:55:40] And looking forward to checking back in on the Alloa team as we continue to. It’s hard to believe. Or where will Bob Thomas publishes? It’ll be March 2020. Yeah. Seems like it just the calendar. Just flip. But nevertheless, a pleasure to have you here. Thanks so much for having me. You bet. All right. So to our audience, be sure to check out our events and webinar tabs we’ve got at Supply Chain Now Radio dot com. Greg, we’ve got a variety of in-person and virtual events in a few places. That’s right. Really appreciate all of our partners around the world. If he orders events. Automotive Industry Action Group George Logistics Summit, DHL resiliant 360, Moto X and many more, including our stand up and sound off event where we’re flipping the the tables a this after a little bit.
[00:56:24] Yeah. Where the panel moderators won’t say as much and just kind of facilitate. Think of it as I mean seriously think of it as a as a town hall. Yeah. Except that you don’t have to ask a question that a politician is going to answer. You can answer the question form.
[00:56:43] That’s right. That’s right. We might bring for both of us some 3M tapes that Sheer from Minnesota with 3M in their little bit to keep us focused on Orvell through. We’re talking 3M that way. At least we have Flix. There you go. Yeah. But yeah. Checks out at Supply Chain Now Radio dot com for these events, including this interactive global forum that we are hosting. I’m facilitating. And if you can’t find something that we talked about here today, shoot a note to our CMO Amanda at Supply Chain Now Radio dot com or hit us up on Twitter at Gregory S. White and at Scott W. Lewton. We like our middle initials. For some reason, my parents gave him, too. That’s right. I guess. Big thanks to, I guess, your day on Supply chain. Now, Tom Jones with Allaway Farseeing. See what they’re doing. Lots of passion. Big mission. Their own and yet. And as we mentioned, they’re getting easier and easier to find. They’re everywhere. They’re taken over. Yeah. Invading Atlanta. As we as we speak to our audience, be sure to check out other upcoming events, replays of our interviews, other resources at Supply Chain Now Radio dot com. Find us and subscribe wherever you get your podcast from. On behalf of the entire team, Scott Luton here wishing you a wonderful week ahead. And we will see you next time on supply chain now. Thanks everyone.
Tom Jones leads enterprise sales, alliances, and business development for Alloy Technologies out of Minneapolis, MN. With a BS in Computer Science, and an MBA, from the University of Minnesota Carlson School of Business, Tom has spent more than 12 years in roles spanning Transportation Logistics w/ Penchant Software (purchased by 3PD, then XPO Logistics), Retail Finance with Best Buy, and nearly 7 years focused on the Consumer Products vertical with Anaplan, before joining Alloy as Regional Sales Director in 2019. Tom works with Alloy’s largest enterprise customers in developing the platform for the Supply Chain and Sales teams to improve transparency, response times, forecast accuracy, and better understand their go-to-market effectiveness at retail. Alloy leverages the most current data available to brands, at the most granular levels, to weave a comprehensive and harmonized story out of the data that accelerates the insight-to-action cycle for all teams dependent on sell-through success.
Upcoming Events & Resources Mentioned in this Episode:
Subscribe to Supply Chain Now: supplychainnowradio.com/subscribe/
Connect with Scott on LinkedIn: www.linkedin.com/in/scottwindonluton/
Connect with Greg on LinkedIn: www.linkedin.com/in/gswhite/
Connect with Tom on LinkedIn: www.linkedin.com/in/tomjones3/
SCN Ranked #1 Supply Chain Podcast via FeedSpot: tinyurl.com/rud8y9m
Gartner Supply Chain Symposium in Orlando: tinyurl.com/sqvnkex
SCNR to Broadcast Live at MODEX 2020: www.modexshow.com/
SCNR to Broadcast Live at AME Atlanta 2020 Lean Summit: www.ame.org/ame-atlanta-2020-lean-summit
2020 Atlanta Supply Chain Awards: www.atlantasupplychainawards.com/
SCNR on YouTube: tinyurl.com/scnr-youtube
The Latest Issue of the Supply Chain Pulse: conta.cc/2tXz9gT
Learn More about Resilience360: www.resilience360.dhl.com/
Coronavirus Impact on Supply Chain Operations: tinyurl.com/wfgqtpv
2020 AIAG Supply Chain Summit: www.aiag.org/store/events/detai…ventCode=E20SUPPLY
2020 AIAG Corporate Responsibility Summit: www.aiag.org/store/events/detai…ventCode=E20CRSMMT
Check Out News From Our Sponsors:
The Effective Syndicate: www.theeffectivesyndicate.com/blog
U.S. Bank: www.usbpayment.com/transportation-solutions
Vector Global Logistics: vectorgl.com/
APICS Atlanta: apicsatlanta.org
Supply Chain Real Estate: supplychainrealestate.com/