A bright supply chain future
Learn how Lamps Plus revolutionized their supply chain with SPS Commerce, achieving greater efficiency and vendor collaboration over a 20+-year partnership.
The challenge:
Automate supply chain processes to accelerate order processing, reduce inventory and improve vendor collaboration.
The solution:
The result:
Enhanced customer conversion rates, minimized manual touchpoints, optimized inventory management and strengthened vendor relationships.
The challenge
Lamps Plus is the nation’s leading specialty lighting retailer with a thriving eCommerce business and 32 stores in the western United States. With a diverse assortment of over 90,000 designs, including 20+ exclusive brands, Lamps Plus fulfills 70% of its orders from its own warehouses and drop ships the remaining 30% directly from vendors to consumers.
Over two decades ago, Lamps Plus sought to eliminate inefficiencies in its supply chain, which previously relied on manual methods like faxing orders, calling vendors to check order status and receiving paper invoices.
“Back in 2002, we knew there was a better way to run our supply chain. SPS Commerce was the game changer we were looking for. In fact, we still have a copy of our original contract with SPS, which speaks volumes about the value of our partnership that has spanned 20+ years. Collaborating with SPS and automating how we exchange data with vendors has completely transformed how we do business.”
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
The solution
The collaboration between Lamps Plus and SPS Commerce began with a focus on automating foundational elements of the order cycle. The SPS team worked alongside Lamps Plus to streamline critical processes with vendors, such as purchase orders, order changes and invoices. This transformation replaced a patchwork of systems and manual processes, providing Lamps Plus with a consolidated way to track orders and communicate with its community of 700+ vendors.
Lamps Plus relies on drop shipping to add products to its assortment and increase sales without carrying additional inventory. Drop shipping requires greater collaboration with vendors to ensure products are in stock when customers expect them. The company partnered with SPS to implement inventory feeds, so they know exactly how many units each vendor has on hand in which locations—without the need for constant vendor outreach.
“Inventory optimization is crucial for us as a primarily direct-to-consumer business. Up-to-date inventory feeds allow us to view vendors’ inventory as clearly as inventory in our own warehouses. With this information, stores and customer service representatives can see if items are in stock and if they are not, when they will be available.”
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
By implementing advance ship notices (ASNs) with vendors, Lamps Plus also optimized receiving and shipping processes. Using ASNs empowers Lamps Plus to promptly confirm vendor shipments, enabling the company to realize sales more efficiently. Additionally, the system automates invoice processing by enabling a three-way match between orders, shipments and invoices.
“When customers are happy, we’ve done our jobs right. One of our competitive advantages is that every order fulfilled by domestic vendors runs through SPS Commerce. This allows us to process orders without downtime, ship orders to customers quickly and meet our delivery timelines.”
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
The results
For Lamps Plus, supply chain efficiency comes down to optimizing its conversion rate, or how many orders the company receives versus how many they ship. Setting clear customer expectations about inventory availability and delivery timelines, and consistently meeting those promises is critical.
“Fulfillment speed is paramount. Faster shipments translate to higher customer retention and fewer order cancellations. Working with SPS allows us to monetize sales quickly, minimize stock levels and uphold our customer commitments.”
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
SPS Commerce provides tailored solutions for vendors of all sizes and technical abilities to collaborate with Lamps Plus. Vendors appreciate the simplicity, affordability and efficiency of the SPS platform, along with the full-service team dedicated to their success.
“We engage with our vendor community, seek feedback and prioritize long-term collaboration rather than just compliance. Working with SPS is a win-win situation for us and our vendors that keeps costs down for both parties and maximizes sales opportunities.”
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
Moving forward, Lamps Plus plans to expand its use of vendor scorecarding to analyze EDI compliance, as well as fulfillment performance, such as ship completeness and timeliness.
With SPS, we send and receive supply chain data in one, consistent format for both the retail and wholesale parts of our business. Building individual connections to each vendor would be excessively time-consuming and cost prohibitive. Our streamlined approach with SPS enhances vendor collaboration, improves our customer experience and drives efficiency across all facets of our supply chain.
– Bill Gratke, Senior Vice President, Supply Chain, Planning and Reporting
