From ‘Shark Tank’ to Amazon, Spikeball's Inventory Management Strategy Shines
Appearing on the television show “Shark Tank” can be a dream come true for many startups and SMBs — that is if you have a strong inventory management strategy. With millions of viewers, brands featured on the show run the risk of selling too much product with too little inventory.
When Spikeball, a manufacturer, distributor and online retailer of sporting goods equipment, had the opportunity to be on "Shark Tank" back in 2015, the company was able to fulfill 100 percent of the surge in orders the next day by having a deep understanding of its inventory.
“The day ‘Shark Tank’ happened, we knew the exact threshold we could sell,” explains Scott Palmer, Spikeball’s chief operating officer.
Spikeball has been able to leverage its inventory management strategy to scale efficiencies, expand to new sales channels and avoid stock-outs ever since its appearance on "Shark Tank" by creating meaningful relationships with product suppliers and monitoring inventory.
Strong Partner Relationships
Spikeball places significant emphasis on integrating with the software providers it partners with, inventory being no different.
“Our philosophy has always been, for every software platform that we use, to build a relationship with the provider,” says Palmer. “We keep them updated on our business so that way when we call and need help, they know exactly who we are. We do that with the post office, too. We want them to feel like we're part of their company, and we want them to feel like they're part of our company.”
By building these strong vendor relationships, Spikeball’s lean team of employees is able to operate more efficiently.
“We want to be the beta tester,” says Palmer in regards to testing new features from its software partners. “We want to be the alpha tester. We want to feel the pain they're feeling with new features, which possibly are going to mess things up for us and cost us a bit of money.“
At the end of the day, Palmer believes that helping one of Spikeball’s vendors develop a new feature that could possibly streamline a whole process will cost drastically less than if he hired a full-time employee.
“It’s kind of like a step ladder,” explains Palmer. “You go up and fight an uphill battle for a little while, then you have a great taper-off period when things are clicking really well. Then you take the next step moving up the ladder.”
Deep Understanding of Inventory
Spikeball’s goal is simple: never have to say “no” to an order. To accomplish this, Palmer monitors every sales channel on a daily basis.
“I know against every sales channel what I expect to sell today and this week," notes Palmer. "We look at it every two weeks.”
If the numbers are above or below expected, the team will wait to see what happens in the third week and then react.
“We either slow product down or speed product up,” explains Palmer. “We built enough buffer within the system to allow us to change very rapidly and make fairly large swings, in both directions.”
Spikeball uses Brightpearl's platform to see past sale trends in different channels, helping the retailer forecast future demand for its product. By just looking at overall growth numbers lumped together, you'll miss key insights, Palmer says.
“If I can’t see what grew as compared to last year, what channel didn’t do as well as compared to last year, we would be drastically off on a lot of our forecasting,” says Palmer. “We're making this pivot where Amazon is huge. It’s always growing. But that growth might mask slow growth or the decline of another sales channel.”
Additionally, by having a deep understanding of its inventory, never saying “no” to an order doesn’t mean Spikeball always has a surplus of product in its warehouse.
“We've never found ourselves in a situation where we had too much [product],” says Palmer. “We have enough insight and visibility into the entire supply chain that allows us to react very quickly.”
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