How CDW Delivers on the Back End
Doug Eckrote, senior vice president of operations for the technology products and service provider CDW, provided a blueprint to how CDW — which had $8.1 billion in annual sales last year — handles its product distribution in a session at the recent Internet Retailer Conference & Exhibition in Chicago.
With the abundance of freight options available (FedEx, UPS, DHL, USPS), CDW contracts with them all, Eckrote said, to get customers the best rate. The company’s Web site lists every shipping choice for customers after a purchase, with pricing included. Invariably, customers select the lowest price, Eckrote noted. “If a carrier raises its prices, it’ll see a drop in business,” he said. “Our account managers will tell customers to pick the lowest cost.”
CDW customers also have the ability to decide whether they want their products drop-shipped from the manufacturer and can choose overnight or deferred (ground) delivery.
CDW ships most of its products same day (on average, 45,000 units per day), leading to a fresh start each morning. “Nobody goes home till everything is out the door; it’s like starting a new business each day,” Eckrote said, noting that 88 percent of orders are shipped on the same day they’re received, and 95 percent are shipped within 24 hours. It accomplishes this through its two main distribution centers, one at the company headquarters in Vernon Hills, Ill., and its newest site in North Las Vegas.
For CDW, the North Las Vegas distribution center site was chosen strategically in collaboration with its suppliers and distributors. California accounts for more of CDW’s business than any other state.
While not wanting the distribution center in the state of California, for reasons Eckrote wouldn’t disclose, the Las Vegas location was ideal. “Next day delivery can now be shipped on the ground, which is a tremendous cost savings,” he said. “Customers could care less what warehouse the product comes out of as long as it gets there when they expect it.”