Price, quality and chemistry were the decisive factors when Smallstuff chose DKI Logistics A/S as their warehouse and logistics partner.
In the COVID-19 lockdowns, Sisse Rie Holmer, founder and CEO at Smallstuff, had time to review her company’s warehousing situation:
“We founded the company 15 years ago and from day one we had our own warehouse,” she says.
Smallstuff designs and markets toys and interior designs for 0-6-year-olds and wool and cotton clothing for 0-3-year-olds. Smallstuff sells via dealers and its own online shop.
“Running our own warehouse meant that we employed people to receive, pack and ship our orders. The workforce was growing all the time,” explains Sisse Rie Holmer, who decided to investigate opportunities to outsource warehouse functions:
“I was aware that the market had become professional enough to bring our business to a new level. We feel it is important that our products are packed and delivered properly to our customers.
“Outsourcing meant that we would no longer need to focus on warehousing and could therefore spend more time and effort on design and sales. Design and sales are what we do best – and what we should spend most time doing.
“By outsourcing, to some extent, we converted fixed costs into variable costs – and gave ourselves an opportunity to economise,” she says.
Friendly and professional advice
Sisse Rie Holmer contacted her customers, suppliers and subsuppliers and asked them which warehouse and logistics companies they believed ought to be included in Smallstuff’s search and why.
“I ended up with four names and contacted all four.”
Despite having run their own warehouse for so many years, Sisse says that there were certain parts of the process she knew nothing about. For example, she was not aware that warehouse and logistics companies measure and weigh goods for picking and packing in different ways.
“I had to develop categories of my own to ensure that I compared like with like.”
On the other hand, she was abundantly clear about the criteria she would use to choose her new business partner:
“Price, quality and chemistry are important when choosing the right partners.
I found that different companies welcomed my inquiry in different ways, and it was important for me to find a partner I felt at ease with.
DKI Logistics offered professional and very friendly advice right from the start. They did everything right, from defining where we should land in terms of prices to how they best processed our products. It did not take us long to finalise the practical details,” explains Sisse Rie Holmer.
Meeting challenges with a smile
Once the agreement was in place, the warehousing solution was initiated. Sisse Rie Holmer explains that there were teething problems at first:
“That’s to be expected whenever you start something from scratch. However, DKI’s approach was ‘OK, that’s a real issue, let’s see what we can do about it’”. DKI showed willingness and professionalism.
Some of Smallstuff’s products are stocked in DKI Logistics’ AS/RS (automated warehouse system), others in a conventional warehouse set-up.
“At DKI, the path from sale to operation is short, so I get the impression that everyone within DKI Logistics’ business is interested in me as a customer. Jens (Sales and Development Director, Ed.) steered the process. He was good at carrying us to the next bridge and did not let go until everything was operational.
Sisse Rie Holmer also points out that the department managers at the warehouse attended all the meetings, and this meant that any teething problems were resolved fast and efficiently.
Outsourcing saves money
“It would of course have been simplest if all our products could be processed via AS/RS. However, I don’t believe that we are the only DKI Logistics customer who needs both AS/RS and a manual warehousing solution. We have several thousand items in AS/RS and possibly 20 in the manual warehouse.
We began by moving toys and interior décor items to our new external partner. Smallstuff’s clothing collections will be moved by the end of the autumn:
“Our clothing goes straight into AS/RS,” says Sisse Rie Holmer.
“If DKI is to learn something from our case, I think it is worth mentioning that I discovered far too late in the process what a robotic system can and can’t do. I imagined that there was more in each box that there is, and I thought that there was a man at the end of the robotic system. I hadn’t imagined that calculating the volume was important for packing the boxes, so I was completely unaware of how important volume calculations really are,” she says. She believes her input may give food for thought to others considering outsourcing their warehouse.
“I am thoroughly satisfied with our cooperation with DKI Logistics because all the challenges we met were resolved – what’s more, with a smile…”