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Hiring and firing suppliers is second nature to most businesses, but more difficult if the supplied service sits at the very heart of your business.
Take for example, the dependency that many businesses have with their web developer in the provision of hosting, content and e-commerce services. Not only has much time and effort been invested in the relationship but there is also a fear of the potential cost and operational consequences of switching to a new partner.
Matt Smith, MD of D&E Office Solutions, Southampton, believes that the combination of dependency and fear can mean that some businesses put off taking essential corrective action when major problems occur.
“When we approached our existing developer to build an additional site we were disappointed to receive a proposal which I thought was vastly over priced, incorrectly specified, poorly designed and which attempted to bamboozle us with science. I just felt that our supplier was unfairly attempting to exploit their relationship with us”, says Matt.
At stake was not only the development and launch of The Green Office - a new online trading division specialising in eco-friendly office supplies - but also the potential risk of leaving the existing D&E site being managed by a disgruntled supplier. What made matters worse was that the launch schedule had slipped by two months and looking for a new supplier meant that they were back to square one. Equally, the new site required the expertise and resources of a supplier capable of quickly delivering a fully featured e-commerce site with about 5,000 different products. With this number of different lines it was also essential that once launched, Green Office were able to independently add and remove products, change pricing and run promotions through a user friendly content management system.
As Matt notes, “It’s easy to take a short term view and take the line of least resistance, but this was about making the right long term decision and finding a partner capable of not only developing The Green Office site but also helping us to overcome some of our online marketing challenges”.
So what were the critical success factors in launching and growing an online business in this specialist sector?
Founded by his father in 1978, Matt has more than eighteen years experience of working in the office supplies industry and the last five years as MD - but until recently most of this experience was in supplying conventional supplies, office furnishings and copiers/printers being one of the largest and fastest growing agents for Ricoh.
“I’m no tree-hugger”, says Matt, “but, like most other people, I was becoming more aware of the importance of doing my bit for the environment. Once we started researching the market we found that although there were several companies operating in this sector, they didn’t seem to be approaching it in a way which would allow everyday businesses to make informed choices about the mix of eco and conventional products available to meet their needs”.
“We could have just listed only green products – but this has an environmental downside. If businesses buy green supplies from us and conventional supplies from someone else that’s twice the quantity of CO2 from two different vehicles. So it made sense to offer a ‘one stop shop’ and let the client choose. For each product in every category we use symbols to clearly state the environmental benefit, how much is re-cycled, whether its from renewable or Fairtrade sources, or has Green Dragon accreditation - or whether it’s a non-eco product.”
This approach also enabled The Green Office to offer businesses a ‘green audit’ based on their regularly purchased items. For each item they provide a listing of alternative products.
As Matt notes, “Some green products are less expensive, some more expensive and for comparison purposes we try to offer cheaper options for clients that wish to purchase conventional products. Once we have gone through this exercise, our clients feel good about themselves because they’re buying green and might also save money at the same time. Everyone is happy!”
However, the major problem confronting Green Office was how to cost effectively acquire new clients. In a very competitive market, margins are tight and order values low which means that there are long payback periods for running costly new business acquisition campaigns. However, the availability of online search has revolutionised the market for niche suppliers such as The Green Office whose main targeting objective is to ensure that the site is visible to people and organisations wishing to actively purchase eco friendly office supplies - such as wildlife trusts, charities, doctors surgeries and schools.
Faced with these issues, Matt approached a shortlist of alternative web developers and within a short time frame appointed Web-Feet.
“Not only did Web-Feet submit a fantastic price for an e-commerce trading platform but their design proposals were exactly to brief. This was followed by a first mock up of the site which was perfect – it was exactly what we were looking for.”
Once the design and navigation phase had been completed, there was the sizeable task of building a product, pricing and image database for several thousand products as well as creating automatic associations for each product based on shopping and look up histories so that relevant options could be presented to each user for each search.
As Andy Coley, Technical Director, Web Feet comments, “The initial challenge was in building the site in a very short timescale – they had already made one false start and so we had to get it right first time and get the site launched. With this number of products and product variations it was essential that users could easily navigate their way around the site and, on one page, easily compare the green credentials of one type of product with another. We also had to ensure that any search resulted in green products being weighted to appear at the top of the listing.”
The Green Office also wished to incentivise clients to make bulk purchases, as this made environmental and business sense. For each order over £100 a tree is planted on their behalf, but this required a £countdown functionality in the shopping basket. Other functionality included additional routes for navigating between products – for example, quick searches, customer product reviews and the standard cross selling device of ‘people who bought this also bought’.
At the same time, Web-Feet were also managing the optimisation of the site to obtain good early search engine placements. Like most other launches, site traffic was going to be initially dependent on running cost-effective Google Adword campaigns until the results of the optimisation began to yield results. Key to this process was creating effective tracking mechanisms and site statistics so that orders could be linked back to their source and campaigns improved.
Early results for The Green Office look very encouraging. In the period immediately after launch order volumes doubled every month - so a promising start and a good platform from which to achieve its objective of £1m turnover by 2009.
Matt summarises, “Good supplier relationships are the key to success of all businesses. With Web-Feet we have found a partner that is passionate about what they do and who are really keen on retaining and nurturing their clients. They are a really good company to deal with – we haven’t looked back since.” 
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