Overview
During this time of uncertainty with inflation and supply chain issues affecting merchants and marketplaces, the last thing you need is to be caught unaware of price hikes from vendors especially on bestselling products. With margins as thin as they are on the marketplaces, higher costs can mean the difference between profit and loss. Unexpected price increases can destroy gross margins turning profits into losses which ruin the bottom line.
Challenge
One of our merchants Global Teck recently ran into vendor cost issues affecting their sales and profitability. They discovered price increases with many popular products they sell online. The price increases turned once profitable sales into unsustainable losses.
They quickly realized they needed to institute better cost and pricing controls to catch vendor price in a timelier manner to avoid selling products below their price floor, or worse, for less than the product cost.
Using Excel was considered, but the process sill required someone to download the price list, upload to an Excel spreadsheet, compare the current price to a previous price in another list, determine which have changed. Finally, upload those changes to their online master catalog so vendor price changes would be repriced, and sent to the various sales channels where the products were listed.
Realizing the enormity of the task at hand, Global Teck turned to us to fully automate the process of synchronizing prices with their 2 largest vendors with their online master product catalog ensuring costs are up to date and current.
Solution
We created the Vendor Cost Monitor utility which is designed to run 24/7/365 automatically monitoring and checking 2 of their largest vendors for price changes with no human intervention required. We included a way to initiate manual overrides in case an immediate price check is needed. Additionally, email alerts are automatically sent when prices changes are discovered.
Once a price change is discovered by comparing the current merchant cost to the vendor price, the new vendor cost is automatically uploaded to Global Teck’s master product catalog replacing the previous cost. Their price rules take it from there and re-prices the products accordingly. Eventually those new prices are pushed out whichever sales channels it is listed.
Several different technologies were used to implement for the Vendor Cost Module. We used File Transfer Protocol (FTP) with one of the vendors to download their current price file. With the second vendor we used REST API and JSON to request and receive price data from their online catalog. Finally REST API and JSON is used to send the new prices to Skubana where their master catalog is maintained.
Post Office Protocol (POP) is used to send email alerts to various recipients alerting them to vendor price changes. Anytime price changes are discovered, emails are sent.
Bottom Line
The Vendor Cost Monitor eliminates any surprises to vendor cost changes particularly unexpected price increases in an orderly and methodical process.
Global Teck now receives timely notifications for vendor cost changes via email while their product catalog is automatically updated with the new vendor prices as they occur. The entire process runs from start to finish without human intervention running 24/7/365.
One less worry for Global Teck’s staff. The Vendor Cost Monitor frees staff to focus on other tasks better suited for human intervention. Devoting staff time to a process which can be automated is both resource intensive and expensive. In a situation like this, automation is the obvious solution.
To learn more about how we can help with your business automation, 3rd party integrations, custom development, and reporting, contact us.
Project Specifications
- Category: Integrations
- Platform: Marketplace Reporting
- Database: MS SQL Server
- Technology: HTTPS, FTP, REST API, JSON
- Type: Vendor Cost Monitoring
- Client: Global Teck
- Location: Fairfax, VA