What happens when your warehouse for your eCommerce business is more than 1,000 miles away from where you live?
Earlier this year, we kicked off a series with Kyle Goguen of Pawstruck.com to learn more about an established store as it tries to break the seven-figure revenue mark. One of Kyle’s biggest goals was to streamline his warehouse practices and find a manager he could rely on. Several months later, it’s time to check in.
Andrew: Welcome to the eCommerceFuel Podcast. I’m Andrew Youderian. Earlier this year, we kicked off a series with Kyle Goguen of Pawstruck.com about a year in the life of an eCommerce store owner, and we started by looking at his goals. We wanted to follow him throughout the year to see how things went, what were some of the successes and his challenges. And today our producer Laura Serino is going to be bringing you an update to Kyle’s story, specifically in the area of warehousing. What happens when your warehouse is 1,000 miles plus away from where you live, not at 3PL, not Amazon’s FBA, but the warehouse that you’re responsible for owning and running? We’ll find out. Here’s Laura with today’s episode.
Where We Last Left Off
Laura: Just to catch up on where we last saw off things with Kyle, one of his biggest warehouse issues was staff. His warehouse is in the Midwest, and Kyle’s based in Southern California. His warehouse was closer to him initially, but he decided to move the facility somewhere more affordable. His Midwest warehouse had lots of part-time workers that would stay on for a while and then move on, so he decided having a full-time onsite manager who would help things run more smoothly. Here’s Kyle from our first episode back in March.
Kyle: She hopefully will take ownership of this warehouse and make it her own. Like I will be giving her the reigns to kind of do what she liked with it, obviously with my, I guess, approval and my help along the way but I want her to kind of take this over as her baby and hopefully that will alleviate a lot of issues I was experiencing before.
Kyle Checks in from the Road
Laura: Shortly after our first episode with Kyle aired, he was on route to his warehouse in the Midwest and sent me an audio update.
Kyle: So I’m sitting in the airport just thinking through what I need to get done this week. And the reason I’m flying out here is to officially train our new, I guess, can consider in some ways as kind of our warehouse manager, the one that’s gonna be handling all the fulfillment of our packages, the one that will be taking over purchasing, receiving and also hopefully someday kind of be the one managing a team of people fulfilling orders.
Laura: This visit was going to be Kyle’s first time training his new warehouse manager in person. Before this they had only chatted on Skype and met in person once.
Kyle: I would say I’m excited, also nervous, for multiple reasons. Nervous just because I kind of have like one shot here to get it right so I’m gonna be there on Monday through Friday. I need to train her really well so that hopefully she can take over. If that goes poorly, I’ll have to fly out again, and just in general hoping that she is gonna be the right fit for what we’re looking for. And not only the right fit, but someone that’s gonna stick around so that we’re not having to hire again and you know come up three months down the road and try to replace this role.
Laura: It’s been almost five months since we last heard from Kyle, so I was cautiously optimistic that things at the warehouse were going well based on some of his email updates. So yeah, warehouse manager, how has that been going?
The New Manager
Kyle: Sure. So it’s been going really well. The person we hired is doing a great job just kind of been able to handle a lot of things that the people before her weren’t able to handle, kind of make more decisions on the fly, which is exactly what I was looking for.
Laura: In terms of on-boarding, the most complicated part was the distance. Kyle set up SOPs and Asana and had regular calls with his manager. He’s still flying out every six weeks or so for onsite training and to see how things are running. So relatively smooth, it sounds like, in terms of, you know, finding someone that was a really good fit for what you were hoping for.
Kyle: Yes, I would say I’m lucky to have found the person that we have, but also there’s a lot of things that came up that made it complicated.
Laura: An amazing warehouse manager that’s self-sufficient and driven, what could go wrong you ask? One thing that’s easier to overlook is if your one full-time employee needs to take time off.
Kyle: She was sick for, I believe, it was two or three days. And because she’s kind of managing everything at this point over there, caused the big issue where orders weren’t being shipped out, and it was actually on a Monday and Tuesday, which made it even worse, just because we had orders piling up from over the weekend. So we kind of handle that, had to contact some customers, letting them know that there’s gonna be somewhat of a delay, but it was kind of the kick in the pants that we needed to kind of realize that we need to get her some more help. Even if the person’s not gonna be as busy as we’d like, she needs to have backups in place, so that if this sort of thing happens or when she’s ready to take a longer vacation, it’s not as last minute notice and things don’t shut down, I guess.
Laura: Kyle’s new warehouse manager ships an average of 100 to 120 orders on her own each day with occasional part time help when things get a little nuts. And putting these orders together isn’t just an easy pick and pack system.
The Complications of Dog Treats
Kyle: On our website, we sell by the piece. People can order anything they want. So every order is different and customized to some extent. So someone could order 2 of these bones, 10 of these treats, you know, 11 of something else, and she would have to put that all into a box. So nothing’s uniform and all of our products, generally they’re made from natural body parts of different animals, so the sizes of them vary quite a bit as well.
Laura: A lot of these packing decisions aren’t automated and need to be fulfilled on the fly. And when you’re dealing with items like ballistics sorting isn’t easy either. A couple thousand sticks are sorted each week. Trying to figure out a better way to do this is still high on his list as it takes up an enormous amount of time for his manager.
Kyle: Overall, we’re doing a lot better job when it comes to our warehouse and inventory management and all of those sort of things. We’re not running into as many stock issues as we were before but I would say it’s definitely not perfect.
Pawstruck’s Warehouse & Using FBA
Laura: Orders through Pawstruck.com are handled, packaged, and sold differently than they are on Amazon. But everything, except for the 25% of Pawstruck’s products handled by FBA, are in the same warehouse. It’s a lot to stay on top of.
Kyle: All of our FBA products we’re trying to have them sent to us all ready to go to ship to Amazon, and for the most part that is run pretty smoothly. It saved a lot of time and money and it really has helped us get more inventory into FBA and not run out of stock on the products that we switched over to this process.
Laura: This has been an especially rough week for Kyle. One of his suppliers mislabeled a shipment of over 1,000 products with the wrong barcode that arrived to Amazon. They’re not sure how many in the order have the incorrect bar code and skew.
Kyle: And that product went up to like dial because of that sale went up to like the number one seller in that category, the specific like years category. But then it’s all the wrong product so it’s probably gonna screw all of that up.
Laura: And naturally this all happened while they were running an Amazon lightning deal.
A Stormy Day During an Amazon Lightning Deal
Kyle: Because someone, a couple of people brought it to my attention, I noticed a trend and I had them…the reason I have them send me photos so I could tell if it was just an Amazon error, if the customer was wrong, or if it was an actual error, and then I saw the bar code and matched everything up and I was like, “Oh, crap. That’s not an Amazon problem, that’s us doing it wrong.”
Laura: Kyle was able to change the skew to redirect orders to be merchant fulfilled for the time being and shut off his FBA. He used Feedback Genius to send out emails to any customers who received the wrong shipment, letting them know it’s being taken care of and to contact him directly. Getting ahead of an Amazon shipment gone awry is crucial since lots of negative reviews rolling in could affect his account.
Kyle: Would do probably like 25% FBA and then 75% merchant fulfilled. So what I did as soon as I found out was I turned the FBA to off on that product and turned it to merchant fulfilled, so any future orders as of last night coming through would be sent just directly from our warehouse so it’ll be correct. So that kind of stopped the bleeding and like keep the FBA inventory where it is and not being shipped out.
Laura: Even though things are going much better for Pawstruck’s warehousing best practices, Kyle knows there’s still room for improvement.
Is Outsourced Fulfillment the Future?
Kyle: So with all the issues we’ve had, there’s definitely times where I wish we could outsource fulfillment, use some sort of 3PL or some other system to kind of handle all of that. If it were possible, I would definitely look into it. I just really don’t think it’s possible for what we’re doing the way we sell and the products that we sell.
Laura: Kyle’s Amazon’s nephew has a happy ending though. He posted in a private forum that following week that Amazon re-stickered all his incorrect products on his behalf. Assuming they did it correctly, he won’t have to recall the units and fix them in his own facility. I’m sure his awesome new warehouse manager is happy about that one, too.
Thanks again to Kyle Goguen of Pawstruck for letting us profile him over the next year. We’ll be checking back in with him in a few months’ time. And in the meantime send Kyle a question on Twitter at pawstruck_pets. If you’re interested in joining our community with Kyle and many other six and seven-figure store owners, check us out at eCommerceFuel.com. Thanks so much for tuning in, and we’ll see you again next week.
What Was Mentioned
- Connect with Kyle: Pawstruck.com | LinkedIn
- Pawstruck products on Amazon
- eCommerceFuel Episode: A Year with Pawstruck: Setting Business Goals with Kyle Goguen
- eCommerceFuel Private Forum post: Help! Wrong Product Sent to Amazon FBA, What Do I Do?