Strategy -vs- Tactics

Category Skiiing & Outdoors
Business Type Brick & Mortar Retail
Study Group Phase 1
Status Completed
Company Name Alpin Haus
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Alpin Haus, located in Upstate New York, was a brick and mortar retailer with five (5) locations featuring a full-line of RVs, snowmobiles, skis, boats, pools, and spas with a 60-year history. They had access to a vast amount of inventory through strong supplier relationships and were seeking an e-commerce strategy to extend their retail business and a plan to launch their online retail operations with a focus on Skiing Products.

While their strength was in merchandizing the right products in Skiing and Outdoors, Alpin Haus was not set up to handle pick/pack/ship operations or customer service on a large scale due to limitations on space, which was primarily used as retail outlets with limited storage.

The Computer System they were using was primarily for the RV Business and lacked the capability to integrate with external systems.

In addition, the Company’s inventory management, though it was well established, lacked the accuracy to track availability of each product record.

Alpin Haus had over 15,000 unique product records with manually managed SKU operations. Over the years the practices they adopted to create unique item identifiers, also known as SKUs, were not suitable for large scale data operations. Upon studying their SKU catalog, we also found duplicated records, where the same item had different SKUs assigned to it. Since online retail operations demand accurate record keeping, best practices needed to be established for future operations.

As the catalog was large, we needed to select items that could be profitably and competitively sold online. Since online retail requires deep discounting, identifying the suitable items was essential to jump start revenues with items that were in demand but also could be sold profitably.

The Alpin Haus team was talented, which made the Company successful in its field, but had limited knowledge of how to handle the detail oriented technical requirements needed to set up, organize and manage data operations from pricing to record processing, employing algorithms and automation.

Even though the Company had previously launched a website, it did not have up-to-date product, pricing and inventory information, with no immediate team member having the necessary operational knowledge.

Also, the Company was primarily set up with financial accounting for a conventional retail operation. Since online retail requires KPI driven financial management, which relies on inventory valuation using FIFO method and accurate Cost of Goods (COGS) calculation, the Chart of Accounts needed restructuring.

We developed an e-commerce strategy for Alpin Haus to start a scalable e-commerce operation without having to handle fulfillment or customer service.

Our strategy was to set limited but clear objectives for Alpin Haus:

  • What to sell on Amazon: Learn how to buy the right items at the right price
  • Dynamic Pricing: Learn how to price for maximum profitability while staying competitive
  • Build the processes and the algorithms to create a scalable revenue base.

This e-commerce strategy was best served by creating an Amazon FBA business account. Though Amazon has demanding requirements for systems and data integration, which could be overwhelming for any business, our Amazon expertise and and experience removed the learning curve and possible errors.
We created a Systems Strategy that removed the dependency on their existing systems and focused on the integration of essential data with Amazon Infrastructure using our proprietary e-commerce Platform.

We applied our proprietary method to identify the products to sell on Amazon that could be sold profitably and competitively among 15,000 items and swiftly launched the selling operation by homing in on winning items.

We built a robust pricing algorithm that allowed the company to set the optimum selling price dynamically. In addition, the analytical processes to analyze sales in conjunction with the fulfillment costs were integrated in their accounting system to streamline financial reporting. This took place after recreating the Company’s Chart of Accounts.

Our actions ultimately resulted in:

  • Full implementation of the e-commerce strategy integrated into Alpin Haus processes and strategy
  • Revenues of over $100,000 and 2,200+ pieces sold within the first three (3) months of the operation
  • Integration of the new e-commerce Channel into the company’s Operations and Accounting
  • Optimization of Alpin Haus inventory management and purchasing processes, which yielded savings in cash flow more than $250,000
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