Formula 4 is a leading supplier of car, van, MPV and 4x4 styling accessories, from alloy wheels and lamps to high performance parts from its Carnoisseur subsidiary.
It uses Maginus software to manage all of its key sales, service and fulfilment processes, and to drive its continuing success as a knowledgeable, cost-effective and customer-friendly supplier.
Formula 4 has used Maginus software since 2001, when its main focus was on b2b and b2c sales through a catalogue and telesales operation as well as a retail shop. Since then, the business has branched out to launch its first transactional website in 2004, re-launched the website with new branding and functionality in 2006, and expanded into new markets such as commercial vehicles. One of the most exciting changes was the companys acquisition of the Carnoisseur brand in 2006. The standard Maginus solution has been able to handle all of these business developments, as Richard Langman, Formula 4s Commercial Director, explains.
One of Maginuss real strengths is its flexibility, he said. It supports us when we move into new areas with the business developing new brands, opening new channels and promoting new products. Today we do about 10% of our business through the web, about 15% through our two retail showrooms, and the rest comes through our catalogue and telesales operation. Basically, Maginus lets us sell anything, anywhere.
Managing a complex product portfolio
This flexibility is vital when your business has to manage a large, dynamic product portfolio with complex pricing options. Formula 4 offers around 8,500 products, while Carnoisseur provides about 20,000. With new products coming to market all the time, its essential to have back office systems that make it easy to update the portfolio and change price lists. The company manages pricing by vehicle, so that each vehicle model has a separate price list for its compatible products creating about 1,200 individual price lists that have to be managed and maintained. The company uses Maginuss data-load facility to automate the process.
One product might appear on 200 different price lists for different vehicles, said Richard Langman. Maginuss data-load tool gives us flexible control over the product and pricing database, and allows us to quickly update the database with parts for new models or supplier price changes. I dont think we could manage without it.
Although customers can choose from such a wide range of products, most stock isnt held by Formula 4 itself as this would require huge stock holdings. In spite of this, the company can fulfil 95% of orders the next day through back-to-back and direct supplier deliveries. Maginus also helps the company automate this process. When a customer places an order, purchase orders are generated automatically and sent to the companys suppliers for fulfilment.
User-friendly design significantly reduces training time
Maginus software is designed to be as easy to use as possible. Each Maginus screen provides the information a user needs to manage the part of the process theyre involved in, with on-screen prompts and easy access to other Maginus functions.
Formula 4s complex mix of vehicle and product data is now stored in Maginus, so sales staff simply have to run through a list of questions with customers to identify their vehicle from fundamental questions about the year of registration, engine size and fuel type, down to very specific questions such as the shape of the headlights. Maginus then shows only the products suitable for that vehicle.
When we talk to customers one of the first things we have to establish is the exact make and model of the vehicle they want to buy a product for, said Richard Langman. In the past, our sales teams used to have to learn how to identify the customers vehicle before they could work out the right product code for a compatible tail light, wheel cover and so on. It used to take 6-12 months to bring someone up to speed. Weve reduced this to about two weeks, and in one case we had a new sales person taking orders in two days.
Customer returns cut by 50%
One of the main reasons products used to be returned was because the goods didnt fit the vehicle. Maginus has streamlined this process by quickly allowing sales staff to identify the exact make and model and then presenting them with the relevant products for that vehicle.
Using Maginus weve reduced the number of returns we get by 50% in fact, weve almost completely stopped products being returned because they dont fit a customers vehicle, said Richard Langman. Its great for our customers, its great for our business, and actually its great for our sales people too. With Maginus taking care of the complexities of the portfolio, they can start selling much more quickly, and I think that makes the job more rewarding.
Dealing with you bought what?
One of the keys to Formula 4s success is its relentless focus on customer service. The company prides itself on what Richard Langman calls the M&S approach in other words, making it easy for customers to return products they dont want. Very occasionally, there is a spate of product returns when an error in a specification means an item simply doesnt fit the vehicle it is supposed to. Sometimes, though, the reason for a return is less easy to remedy.
We do get a few products returned by men because their partner wont let them buy new wheels for the car, for example, said Richard Langman. While we might agree with him that its a worthy investment, were here to help, whatever the problem is. Thats what providing first-class customer service is all about: whatever the reason, were happy to take products back if thats what a customer wants. For that we depend on Maginus to help us provide a slick and seamless returns process.
Providing a personal service
Another important contributor to excellent service is being able to handle customer enquiries as quickly and easily as possible. Maginuss CRM and CTI capabilities provide valuable support. When a customer calls they are identified by their phone number, and the sales or service operator can bring up the relevant customer data immediately. All contact with customers is recorded in the Maginus contact log, which contains a complete history of a customers orders, queries and returns. This helps Formula 4s staff provide a knowledgeable, personal service.
Formula 4 also offers personalised products, such as customised spare wheel covers for 4x4 vehicles. The company offers dozens of designs as part of its standard range, but customers can also supply their own images and have those printed onto wheel covers. Maginus manages this process too. Its particularly important during the Christmas season, when sales of personalised products can increase as much as fourfold.
Reporting and the future
Improved management information is another key benefit of Maginus software. As well as the standard reports built into the solution, Maginus allows Formula 4s management to run ad-hoc reports about business performance. This has proved invaluable in identifying the cause of problems in customer service or the supply chain for example, to find patterns in an unexpected increase in product returns.
Formula 4s acquisition of the Carnoisseur brand is set to play a key role in the companys future, and it expects Maginus to help drive organic growth of the new brand as well as its core business. Plans for the future include the addition of promotions to the companys website, which will also be controlled by the standard Maginus solution.
Were really happy with Maginus, Richard Langman concludes. Maginus has given us everything we wanted, and I fully expect that itll continue to help our business grow as we ramp up the Carnoisseur brand. Its an ideal solution for multi-channel retail.