Case studies

American Bedding Solutions – a for-profit company with a non-profit cause

BY Clara Lu 18 Jun, "14

Bruce Brown, partner of American Bedding Solutions, was your usual mattress retailer with four regular retail stores in Michigan, USA, until he had a defining chat with a non-profit organization.

That organization was purchasing mattresses from him for their refugee resettlement programme because every time they brought people in from another country, they had to provide them with beds.

The Birth Of An Innovative Idea

TradeGecko case study - American Bedding Solutions

Well, how non-profit organisations in the US work is that they operate thrift stores, where donated items are put up for sale, to generate money for the programme or charity. So Bruce told the organization, “You should sell mattresses.” And why not? It’s a big business, it’s very profitable, and it would bring in a lot of money to offset the purchases they were making through him.

Bruce’s idea was greeted with enthusiasm, so he got together with his business partners Rick Taylor, Christine Taylor, and Michele Paterson Brown, and put together an actual programme based on a consignment system where they consign their products to non-profit organizations.

In April 2013, an organization partnered up with American Bedding Solutions to implement and test this whole concept in their thrift store. American Bedding Solutions deployed this programme in that thrift store and shortly after, another four more thrift stores with a different non-profit organization. And the concept worked! It was a success on both ends – for both the non-profit organizations and for American Bedding Solutions.

It was an exciting time as American Bedding Solutions started to garner regional interest from a conference that they attended shortly after. They continued to partner up with more stores, participated in more conferences, and went from deploying 12 thrift stores to 28 thrift stores in about four months.

The Need For Systems To Improve Backend Operations

Through this process, Bruce started looking for a cloud-based accounting solution because the accounting system they were using was on a local computer at his business partner’s house, situated about 25 minutes away from the office. Needless to say, it was incredibly troublesome to issue invoices or log payments.

As he started looking for an online accounting platform, Bruce became aware that all his consignment inventory out there (about 500 - 600 pieces) was quickly starting to build up. In addition, the non-profit organizations were rotating stocks, selling and repurchasing mattresses on a weekly basis, and Bruce came to the realisation that he needed to have a tighter grasp on their inventory and its location. This is so they could know where they are exactly with regards to stock levels and which models are selling well – they needed something to enable inventory tracking and give them an idea of what should be out there with their clients.

TradeGecko case study - American Bedding Solutions

Going All In With TradeGecko

Bruce chanced upon TradeGecko in a simple Google search. He discovered that – firstly, TradeGecko is the only online inventory management software in the market that caters to companies with a consignment business model – which is what American Bedding Solutions is essentially operating on. Secondly, he also needed a feature to manage inventory in multiple warehouses and locations, and TradeGecko offers this as part of the overall monthly subscription plan while other systems are charging by location. “So when I put in 25 warehouse locations it cost me thousands of dollars per month. It’s crazy!”

“Since we’ve started using the TradeGecko system, it’s been a huge learning curve for me but your Support Team has been fabulous! They have been terrific with giving me answers and taking our input very seriously with regards to implementing the software for our business. They would say, ‘we have this on the roadmap’, or ‘we’ve escalated this to up to another level for the developers’. And that’s great feedback to get. Because as a user, it’s nice to work with a team saying, ‘I appreciate the input, we’re working on it.’ And so I just decided to make the commitment to you guys, pay for a year and just go all in!”

“You guys are young, and so are we. And I thought the growth between the two might work out really well in the long run because we want a partner that we can stay with.”

Before using TradeGecko, Bruce didn’t have an inventory management plan in place. He was balancing out invoices to purchase orders on spreadsheets, which was easy in the beginning when the company was just dealing with four stores and he could just drive out and see what each store had in inventory.

“But in the blink of an eye, we went from the proof-of-concept process to having 500-600 pieces of inventory out there. We were so busy that we didn’t have time to make sure everything was in place. Now, it is terrific to have a system with which I can view all the Purchase Orders, and know what has been received and what hasn’t. You guys have a great system to help us keep track of our stuff and keep our finger on it."

Using TradeGecko To Track & Manage Consignment Stocks

TradeGecko case study - American Bedding Solutions

“We have the non-profit organizations set up under the Relationships segment in the system. In some cases, an organization may have seven locations to as many as fifteen locations, and we can also go into the Warehouse Location segment and set each one of the individual stores up as a Warehousing Location. With this, we know what each individual store has sold and what it should have in its inventory by looking through Sales Orders and Purchase Orders. It allows us to keep very tight reins on our supply chain.”

“Also, I think the TradeGecko private B2B e-Commerce software is great! It has an intuitive interface and our customers like it so much. It gives us the ability to put together a mock lineup for them, where they can just log in, go through, and check out our products. They can very simply put in an order on the platform, and they love that.”

Deploying the TradeGecko – Xero Integration

“We’re using Xero together with TradeGecko, and that has changed my business dramatically. I think the two most important things this integrated platform has done for us are:

  1. Speed up our purchasing. It makes it very simple for us to track our Purchase Orders, where it was all primarily manually done via emails before. Now it’s automatically synced to Xero upon creation inside TradeGecko, so the system makes it very easy to see what we’re buying.
  2. It also makes getting paid much simpler. Because every time a Sale Order comes in, we can immediately invoice it inside of TradeGecko, which then updates Xero, and then we send it out via the Xero system.

The platform has streamlined processes tremendously. It’s been a huge help, a >huuuuge help.”

TradeGecko – Game-changing Software For American Bedding Solutions

No one has ever done what American Bedding Solutions is doing so Bruce and his business partner have had to cut their own path. It was not an easy one; they have encountered challenges in many areas.

“One of the things that TradeGecko, along with Xero, had done for me, is to free up time to pursue those. The less time I spend on manual processes, the more time I can spend with the stores helping them sell more beds. And it’s certainly doing a wonderful job for us.”

“We have a tremendous investment in all of the stores that we work with. You guys have allowed us, for the first time, to know exactly the dollar amount we have sitting in our inventory, to exactly what our margins are – that’s tremendous intelligence to have.”

Businessman With A Heart

The thing is, the mattress retail business was a good business, why would Bruce want to work alongside non-profit organizations? It goes back all the way to the time when Bruce started working with American Bedding Solutions’ very first non-profit organization, and he started understanding just what an impact they were having on people’s lives. Nobody else – no other retailer, no other organization – wanted to work with them.

When they started talking about this concept that American Bedding Solutions had, Bruce felt that he could take what he knew, apply it on a very small scale in their store, and generate a certain amount of revenue per square foot, which was far and above what they were getting from selling other items in their store. That revenue generated allows them to do amazing things in the communities that they’re a part of.

“And I want to be part of that. I want to sell mattresses and go home at night and when I lay my head down, know that the money that was generated from the sales went to that somebody I will never meet, but have had a positive impact on his life.”

This means that Bruce is selling mattresses to non-profit organizations at a very much discounted price as compared to what a normal customer would have bought from him at his store for. Much, much lower.

Looking Forward At Leaving A National Footprint

TradeGecko case study - American Bedding Solutions

“We want to be the supplier of new mattresses and bedding for every thrift store in United States.”

The challenge American Bedding Solutions is facing right now is being able to scale up fast enough to meet rising demand and growth. They have received wide-scale interest, and are constantly communicating with stores and organizations that are interested in using their service.

Bruce anticipates that by the end of this year, their operations would expand to somewhere between 50 and 100 locations. “Our biggest pressure right now is growth. We have an immense amount of work coming up this year, and TradeGecko is going to play a huge role of keeping all that together.”

Inspiring Words For All Businesses

As our conversation came to an end, Bruce left me with statements worth pondering over, “I think the most important thing that you can do in business is to find a way to service someone else. If you can that, then it’s a win-win situation."

For American Bedding Solutions, it’s a win – win – win situation. Bruce and his partner win because they are helping others and making money while doing that, their customers win because they are able to provide a product that they could not before, and their customers win because they are getting something at a great price which is also helping to fund community outreach programmes. Everybody wins in this circumstance.

Bruce's other takeaway is that businesses have to be creative to find a way to help someone, and technological systems are an important part of that solution. For example, before they started using TradeGecko, the backend structure of American Bedding Solutions was something that was missing even though the frontend of the business was moving forward at full speed. And that panic moment finally drove Bruce and his partner to start looking at options to get their backend operations together.

“In 5 years, we would like to be able to reach out and help a hundred and more locations. We also want to find other ways with which we can benefit the community. We’re pretty creative thinkers, and as we meet people from different facets of this industry, we see the marriages of other businesses that would benefit everyone if they were done in a new way.”

“That’s our goal, to get to a point where this business begins to fund our ability to reach deeper into the community and find better ways for it to operate.”

TradeGecko case study - American Bedding Solutions

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See also:

Kiri Schumacher Jewellery: The Art Of Balancing Creativity With Business

JUSY - Indonesian Fast Growing Fashion Icon Shares Start Up Story

Work Out Life: Changing The Boring Uniform-like Sports Wear Market With Quality Design & Craftsmanship

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