OpenBOM to drive product configurations and real time BOM cost estimations for successful eCommerce business
When a leading eCommerce company wanted to put their products into their customers’ hands faster they turned to OpenBOM! The competition is hot and the customer doesn’t want to disclose the name. We’re publishing the story without mentioning customer’s name, but keeping all details about what the customer does.
As excited customers on the Shopify site configured their made-to-order products, the company needed a better way to capture the customers’ specifications and drive their manufacturing. They needed a way to go straight to manufacturing from Shopify.
The Company didn’t have a smooth way to get from the customers’ demands to the finished product. Their process involves several internal steps coupled with a series of sub-contractors to produce the finished product. Each step along the way took time to configure the bill of materials for that customer’s specific demands… there are thousands of possible combinations of customer selectable features…. Their process did not scale.
On top of all of that, the price and costs of this product vary with worldwide commodity prices. They needed a way to automatically adjust the cost of certain items on a daily basis tied to the market price of a particular commodity on a given day.
After quite a lot of searching and even considering building their own application, this company chose OpenBOM for two significant reasons, 1) the ability to construct a specific BOM with infinite variations, and 2) the robust OpenBOM API which allowed them to update specific commodity costs on a daily basis.
Now, you may be wondering, why do I keep referring to the Company in vague reference? Well, this Company considers OpenBOM to be part of their competitive advantage and has precluded me from using their name or industry. As I came from a very competitive industry myself (semiconductor) I completely understand – any advantage is significant!
So, now exactly how or what does our Company do to reap this advantage!
First and foremost they translate their eCustomers Shopify choices (the product options) into a set of individual and specific OpenBOM items – each choice (option) would yield a unique item or part number in their process.
Next, using the OpenBOM API, they parse that list of options into a BOM and assign it a unique part number. Each and every item in the BOM refers to the necessary commodity. A daily “cron job” automatically updates the item’s cost from a worldwide commodity pricing website. Again, via the OpenBOM API.
Now that they have a BOM for the product that meets the customers’ exact needs, they use OpenBOMs production planning features to create an Order, assign Vendors via the Set Vendors command, and generate PO’s for each vendor.
And our company’s leadership loves it. “Our reliance on daily commodities was a nightmare!” says the company president. “OpenBOM now drives our daily pricing both at the customer-facing (Shopify) and manufacturing levels.
“The joy is the component pricing updates automatically by connecting directly to our suppliers
Catalogs, connecting in a fairly sophisticated way to commodity daily pricing using the openBOM API”
“We Include daily taxes/duties/margins/exchange rates and other variations in such a way as to drive the shopify calculator of our configured items, their SKU and final cost.”
“Our OpenBOM solution is elegant and a great value to the company. We are running the entire company on this integration and absolutely love it. The ease of use of the OpenBOM integration and the availability and expertise of the OpenBOM team are significant to our success.”
“We love the spreadsheet metaphor over the traditional ERP user experience.”
“Finally”, says the company CEO, “OpenBOM can be summed up as a powerful, flexible, easy to rollout solution to a big business problem at a good value and backed by a strong team of experts. What could be better?”
To learn more about OpenBOM visit www.openbom.com