Faster delivery, better profit

TVC Sky Shop has succeeded in marketing some of the most innovative, premium quality and value for money products from both international as well as domestic markets to over five million Indian households. It delivers the ordered products from a few hours to a day across India. In addition, the company is using the latest technology to bring cost and time efficiencies to all aspects of business from order booking, to warehouse management, and customer management through its call center. The company has seen an increase in sales and revenues. This was all possible when the company replaced its disparate, legacy applications with an integrated solution, Microsoft Dynamics AX, to create a seamless, efficient business process.

Situation

Based in Mumbai, TVC Sky Shop is a pioneer of sky shopping, also known as Electronic Retailing and Direct Response Television (DRTV) in India.  It commenced operations in May 2000 and today it markets and home delivers over 200 world-class innovative products to over five million Indian consumers annually at affordable prices. Its robust distribution network consists of more than 450 TVC Distribution Partners (DP) spread across the breadth and length of the country.

The state-of-the art Contact Center, media, creative design, editing, distribution, accounts and finance and IT setup of 275 employees make TVC a completely integrated organisation. It posted the revenue of US $18.6 million (INR 86 crore) in financial year 2009-10.

TVC was using three key applications, a legacy, custom developed customer relationship management (CRM) solution; Tally, an accounting package; and a bespoke solution for Delivery Partners (DP) operations. Lack of integration between these three applications led to several issues such as account reconciliation, debit notes, credit notes, etc. Thus manual involvements were necessary, making every process time-intensive. 

At the same time, TVC relied on a solitary IBM server for database as well as for hosting application. Data was batch uploaded twice a day for distribution partners and back office operations on the live server were maintained at a data centre. In addition to the cost, the need for high speed bandwidth made this an unviable proposition in the long run as TVC has obtained 24-hour home shopping broadcasting license and plans to launch its own 24-hour home shopping channel, showcasing over 20,000 innovative and lifestyle products. With this channel coming into play in near future, the company needed to revamp its operations building in greater transparency, automation, and scalability. This would support the increased demand created by the 24-hour channel and would also serve the fully integrated e-commerce website, customer loyalty programme and mail-order catalogue.

Besides, TVC wanted to check the return on investment (ROI) from its advertising campaigns on TV channels, such as Zee, Sahara, Jetix, Sony, etc, and print advertisements, such as Times Group. This would enable the company to invest in the ones that generate higher business.

To meet the demand generated by a 24-hour channel and the e-commerce web site, an efficient call center, an end-to-end ERP solution was needed that could make a big impact on the business within the budget.

The Solution

TVC strongly felt the need for a flexible, vertically focused business solution to integrate all its distribution partners, franchisees and unify customer data. It initially considered SAP and some ERP solutions developed by private vendors. But after detailed analysis, the team concluded that the cost and time spent would not be justifiable. With growing recognition of the complexity and cost to customise the administrative ERP solutions, TVC shortlisted Microsoft Dynamics AX. Nitin Patki, VP - Operations, TVC Sky Shop Ltd explains, “Microsoft being an accepted platform, data portability is seen as an easy factor. Additionally, customisation flexibility, and integration with other Microsoft products is considered as a clear advantage.”

It partnered with Microsoft Gold Certified Partner, Godrej Infotech Ltd, to implement Microsoft Dynamics AX 2009. Implementation started in January 2009 and the solution went live in January 2010. It was deployed at three locations in Mumbai – the corporate office, call centre and warehouse. Fifteen users utilise modules like General Ledger, Accounts Receivables, Accounts Payable and Warehouse. Dynamics AX was tailored by Godrej Infotech to support unique business requirements, eg, integrating Contact Centre process with ERP. Secondary sales module has been created to track business and inventory with the delivery partners and outlets to ensure quick delivery. The solution is further customised to tap the media source, like television, print or web, from where the orders are procured. Thus the accuracy and effectiveness of media sources is measured by checking ROI, which later aids in future decision making.

Benefits

“Microsoft Dynamics AX supports sales analyses, manages ROI and thus increases the management confidence in the business operation,” concludes Patki. It provides the ability to respond quickly to fast changing business needs.

Reduces Delivery Time by 75 per cent

Previously, manual redirection of orders costs the company time and was error prone. “Dynamics AX accurately redirects orders in real time to delivery partners. Faster, transparent processes have reduced delivery time to 6 hours (from 24 hours) in metros and 12-24 hours (down from 2-3 days) in non-metro cities,”  explains Manish Chaubey, CEO, TVC Sky Shop Ltd.  “Reduced delivery time has further reduced order cancellation, enhanced customer satisfaction and ultimately results in profitable business,” he adds.

Improves Customer Services and Sales

The ability to react effectively to demands, diagnose delivery issues, and the coordinated seamless information delivers a better customer experience. Managing customer contacts, making and meeting delivery promises, and significantly shorter order to delivery cycle are the key benefits. “We can process over 10000 calls every day, Microsoft Dynamics AX seamlessly tracks every single order in real-time. And customer complaints have already reduced from 2.5 per cent to less than 1 per cent in just 8 months,” explains Patki.

“The enhanced customer experience leads to repeat orders, and higher conversions at the Contact Centre. This has helped us increase sales by nearly 40 per cent for the same media budget,” he further adds.

Improves Accounting Controls

Microsoft Dynamics AX streamlines financial transactions, and supports fast and accurate invoicing for each order. Credit or debit notes related to operation of delivery partners, cancelled orders, discounts offered and stock balance held by the partners are all effectively and efficiently handled. This brings transparency and delivers accurate information in real time.

Reduces Inventory Carrying Cost

The solution ensures Sky Shop saves inventory carrying costs across a multitude of costs such as warehousing, handling, obsolescence, insurance, taxes, damage, and shrinkage, etc.