If you have ever struggled with managing your sourcing, production, inventory, or anything on the operations side of your business, then today’s episode is what you need!
It’s called Inventory Management 101 – a conversation between our founder, Ken Ojuka, and Jessi Freitag on the Startup CPG podcast.
They talk about why you should manage your inventory more like you manage your personal finances with a bank account, how to make it all easier through automation, helpful tips for working with your co-packers and suppliers, when you should consider switching from spreadsheets to software for sourcing, production, and inventory management, and tons more.
Whether you’re new or a veteran in the CPG space, you’ll definitely learn something new in this episode.
Listen on Apple Podcasts here or Spotify here.
Ken:
Your product and your inventory that you have in your warehouse is money, it’s just dollars. So you think about it just like a bank account. You can’t imagine running a business or even running your personal life without having a clear idea of what’s in the bank account. Unfortunately, that’s the way that we see a lot of people running their CPG companies.
Jessi:
Welcome to the Startup CPG Podcast. I’m your host, Jessi Freitag. I was reading that 43% of small businesses in the United States don’t track inventory or do so using a manual system. In CPG, our inventory has added complexity of lot and batch tracking, expiration dates, recalls, compliance, and certifications. Brands who win have a handle on their inventory, margins and operations. That’s why we’ve got Ken Ojuka joining us today to talk all things inventory and Physical Product Movement. Ken is the CEO of Fiddle, a modern inventory operations software for CPG brands and manufacturers.
Jessi:
Listen in as Ken walks us through how to think about inventory and CPG, how and when to choose an inventory system, and other best practice tips to manage your inventory like a pro. Hi, Ken, welcome to the show today. Thanks for being here.
Ken:
Hey, Jessi, it’s good to talk to you again. I’ve been looking forward to this conversation.
Jessi:
Yeah. I am super excited. It’s always fun to get to talk to another ops person. This is actually the third podcast episode I’ve recorded with Ken on different… I’ve been on his show, he’s been on my personal show. So this is super fun to get to connect again and to talk, particularly for our Startup CPG audience, and talk all things inventory management. So I’d love Ken, if you could just start us off by telling us a little bit about yourself, your background and what you do at Fiddle.
Ken:
My name’s Ken Ojuka. I’m originally from Uganda. Ojuka is one of these names that people don’t know what to think, sometimes people think it’s Japanese, but no, I’m originally from Central Africa. And I came to The States when I was about seven years old. Personality wise, I am really into sports, I love technology, and I’m one of these rare blends that’s really into sports, but also super geek at heart. My tech side comes out in the form of, I like programming, I like building systems. I like thinking about complex problems and tackling those. That’s fun. I am a father of five kids. We had our fifth kid early last year, he’s almost a-year-old.
Ken:
I love the family life. My kids are super into sports. That’s the dad side of me. I’m the crazy dad on the sidelines cheering for my kids and going half crazy, but that’s fun for me. Anyway, that’s a little bit about myself. I founded Fiddle about three years ago with a friend of mine, his name’s Morgan, he’s my co-founder. Me and Morgan, actually, it’s interesting. We know each other from, we both played soccer at Brigham Young University. We were both defenders on the same team, and learned to work together, really liked each other. We don’t freak out when we yell at each other and things get a little heated, because we’re used to that. And so we’ve been doing Fiddle for a few years and having a blast.
Jessi:
Awesome. I love it. And can you just give us a brief overview of the type of software that Fiddle is and some of the challenges you solve? And then we’ll get into some of your expertise on some hot topic questions.
Ken:
Yeah. So Fiddle is inventory management software for brands. We came from a manufacturing background, and so as we built Fiddle, we actually realized that a lot of the manufacturing background and understanding that we grew up in, it really helps brands to be able to work better with their co-packer to tackle a lot of the problems that they face. But at the heart, we’re inventory software to help you keep track of how much inventory you have, not to just the finished good, but work in progress, and then also raw materials. And then we help you with purchasing, supplier management, having a place to keep track of all the costs and the quotes that you’re getting from all your different suppliers.
Ken:
And then we help you to come up with your COGs. It turns out that’s one of the big things that people struggle with, is, “Exactly how much did this cost me to make?” There’s just a lot of things coming at you all the time. And so Fiddle helps you to be able to make sense of a lot of that.
Jessi:
Great. That’s super helpful. I’d like to start out just taking it back to super basics, inventory 101, thinking it about founders that this is their first CPG company, they’ve probably got a recipe and they’re going to a co-packer. What are some of the things that they’re going to be thinking about related to inventory and that are going to come up and that they’re going to have to either have their own planning tools for or ultimately they’re going to use a system? I’m just thinking about those super early days of being like, “All right, if I know nothing about inventory, what am I going to be thinking about when I get started with a co-packer?” And then we can talk a little self-manufacturing, but let’s start there.
Ken:
Yeah. And that’s a really good question. I’m glad you asked it. The first thing is to really have a perspective, the right perspective about inventory. Honestly, a lot of times when you bring up inventory, people yawn a little bit. It’s not necessarily the exciting part of business, but you have to really think about it like, your product and your inventory that you have in your warehouse is money, it’s just dollars. So you think about it just like a bank account. You can’t imagine running a business or even running your personal life without having a clear idea of what’s in the bank account. And unfortunately, that’s the way that we see a lot of people running their CPG companies, how much inventory do you have, who knows?
Ken:
That’s not an acceptable answer. You can do that for a while, but you quickly can run into some trouble. I like just having the right perspective where this is literally, it’s dollars, you have a million dollars sitting on a shelf in a warehouse somewhere, and you should keep track of that, know when more goes in there, when any of it goes out. You should have a pretty clear picture of that. And I think that the reason a lot of people don’t is because, in the past, it’s been pretty difficult to get those numbers. But we think that with Fiddle, we’re trying to tackle some of those problems, make it a little bit easier, make it approachable for the average CPG startup. That’s probably the first perspective.
Ken:
The second thing is that there’s a lot of ways in which you can automate this stuff these days. A lot of integrations systems do a much better job of talking to other systems in 2022 than I think it did in like the ’90s when this stuff was a lot tougher. Almost every system has some sort of API. And so, we’re really big go on these integrations and trying to automate as much as possible, but giving you a place where it’s like, at least you have a dashboard that’s pretty close to what’s actually sitting in your warehouse. So those are a couple of initial tips. And I think that it goes beyond… one of the other things to think about is it’s beyond just your finished product.
Ken:
There’s a lot that goes into actually being able to deliver a product to a customer, and you have to think a lot about the cost surrounding like your packaging components, your raw materials, even like the freight costs just to ship things from here to there. These things add up where we see a lot of CPG companies that are operating from the perspective of, “I think it costs me five bucks to make my product.” But then when you really add things up and you look at all the freight costs and customs charges and testing charges and warehouse charges and you look at all those things together, you realize that it’s a lot more than $5 to produce that product.
Ken:
And that affects everything. It affects how much you can spend to market this product, it affects the price that you should sell your product for, the channels that will make sense for your product. And so, it’s just a good practice to get an understanding of some of these numbers before you really go to market and start to scale because you’ll get into trouble pretty quickly.
Jessi:
Those are really great perspectives, I really appreciate that. And I think just the thought of really picturing your inventory as dollars is so helpful because I’ve seen it where you’re… You only have limited cash as a startup, and you make a bunch of inventory to fill an order, and hopefully it goes out to fill that order, but you may not get paid for a couple months or the order gets canceled and then you’ve got it sitting there on the shelf. Well, that cash is now tied up. So managing that correctly so that your cash is where you need it when you need it, either it’s a physical good or it’s in your bank account when you need it for trade spend or whatever, managing that whole process can be super tricky for a new brand.
Ken:
Oh yeah, absolutely. And there’s no real school for this, is the thing, is that a lot of us are people who just fell in love with a product idea and started exploring it. And before you know it, you’re running this company with a warehouse full of stuff and you’re just learning on the job. And so it’s really easy to miss some of these concepts or just not really take them seriously enough because you don’t know any better.
Jessi:
Right. And on that note of, for a brand that’s going to work with a co-packer and they’re setting up their relationship, there’s going to be a big inventory component of maybe the brand is providing some of the ingredients or they’re just going to need to know how much inventory is at the warehouse of the co-manufacturer, from your experience and your time with Fiddle, are there tips that you have for seeing people be more successful in working with their co-manufacturer and having a better grasp of what inventory is where and what the actual situation is and how they can set up that relationship for success from a systems and just understanding where the physical products all are in the process?
Ken:
Yeah. I think that you can, you can get pretty complicated with all this and pretty detailed, but there’s a lot of low-hanging fruit that we just experience on a daily basis working with our clients. Just things like setting expectations when you engage with the new co-packer about what the communication is going to be like, the reports that they need to deliver to you. For instance, having like a production run report, a production summary, what did you make? What did you consume? And what do I have left? A lot of times, getting that from your co-packer is like teeth. And setting those expectations from the very beginning that, “Hey, I’m going to trust you with this. We’re going to partner to make this product. But this is what I need in order for me to be able to run my business.”
Ken:
A lot of times, it’s really the basics. The other thing I’d say, which it might be easier said than done especially in today’s world where there’s a lot of supply chain type issues, is make sure that you have some optionality. Co-packers, a lot of times, if they know that they’re the only ones that can make your thing, they end up not treating you the best. But knowing that you’ve got another option is really important so that if you run into any problems, you can still get your product made by somebody else. So even if you have your primary co-packer, make sure to get a secondary and a tertiary co-packer, just so that you can make sure that you don’t fail or run out of product because of a co-packer problem.
Ken:
So there’s just a really great marketer that I used to follow, I haven’t followed him in a while, his name’s Dan Kennedy. Really smart, grew up in the direct response time and talks a lot about direct response marketing. But one of the things that he said that really stuck with me is that the worst number in business is one. Anytime you have one of anything, you’re vulnerable. If you have one customer, that customer goes away, you’re out of business. You have one marketing channel, and a lot of people are feeling this with Facebook, Facebook changes their algorithm or Apple forces them to change how much data they collect, all of a sudden, Facebook isn’t working anymore. Now, you’re vulnerable.
Ken:
If you have one supplier or any component on your build materials, you’re vulnerable. And so just having a little bit of optionality, I think, is just really good business sense.
Jessi:
Yeah, absolutely. That’s definitely a challenge I noticed early on at LivBar, in the early days, there was one supplier for a specialty ingredient. And then all of a sudden, the supplier says, “Hey, kale crop didn’t look good this year, so we just don’t have any.” And you’re like, “Oh shoot, that’s going to be a huge interruption to our business.” So starting to plan in all of those backups for backups, for backups and nurturing those relationships, because it’s not like you can just, especially on the sourcing side, be like, “Oh, I Googled organic kale and it looks like this person has it.”
Jessi:
You got to go all the way through and you got to call them and find out the minimums and all of those pieces so that you’re ready for an emergency. Because when you need that order or when UNFI or KeHE or Walmart places that big order and you can’t make it, then yeah, you’re super vulnerable. So that’s super helpful.
Ken:
Yeah, yeah. And I think it’s important to just underscore that it’s not just the co-packer, to have a couple different co-packers, a couple different options, but like in your example, for the raw materials, and a lot of people don’t think about that. Just cultivating those relationships before you’re an emergency and you’re in a hard spot and you need something. The other side benefit of that is that it helps you to be able to compare pricing. A lot of times, you don’t realize that you can have something done at a much better price, unless you’re constantly looking at the market. And a lot of times with the co-packer, if you make them compete with each other, you end up getting much better pricing and you get better treatment.
Jessi:
Yeah, absolutely. I think this leads us into talking a little bit about sourcing and just keeping track of everything related to sourcing. You’re going to have to submit purchase orders, some vendors are going to have… You’re going to send an email to submit an order, some are going to have automated system. Some you’re going to be sending a PO to a sales rep. It can really just run the gamut as far as what it looks like on the sourcing side. And I’m curious from your perspective, what are some tips to help stay organized in that process, to understand lead times and keep yourself organized on that so you don’t run out of anything and just managing those raw materials coming in?
Jessi:
What tips do you have or what pitfalls have you seen people fall into and then get in trouble that we can avoid?
Ken:
Right, right. It’s interesting that you bring this up, because the sourcing component of Fiddle is actually one of the first things that we built. And it was specifically because there was a pretty big problem with this manufacturer that we were working with. Manufacturers are a little bit different than brands in that a manufacturer, especially for let’s say like a supplement company, they might need to source thousands and thousands of different raw materials just because of the wide variety of things that go into supplements. And so these guys had this problem on steroids, which was, we’re constantly reaching out to these suppliers, they’re sending us information back in a variety of different forms.
Ken:
Sometimes it’s just an email, “Here’s your price. Here are your price breaks.” Some of them will send you an actual price list, some of them will send you like an Excel spreadsheet, send you a link, and it’s just tough to keep track of all of this stuff. I guess it doesn’t necessarily seem like a huge deal, except for when you need to make decisions really quickly. You don’t want to have to go through and comb through your emails and look at an email from six months ago from some supplier before you can decide yes or no in a business decision, you need to have that information at your fingertips.
Ken:
And so one of the things that we built for this manufacturer was a way to be able to keep all of their supplier pricing in one place, be able to easily search through it, be able to see your pricing across different vendors and then keep a history of it so that you can see your pricing over time. And so that’s something that’s actually pretty core to Fiddle. And it’s one of these things where it’s the alternatives that we see out there, and probably the most common thing that we see is that it’s in somebody’s email, it’s in so-and-so’s email. And so you have to start thinking about, what if that person, and these are real use cases, what if that person gets fired? And so now you have to comb through their email in order to get all this, or they’re on maternity leave, or the person decides to quit and take another job and they’ve got all this supplier pricing in their head?
Ken:
It just makes you really vulnerable as a company. And then even something as simple as, I don’t want to have to be the only person that knows what we pay for all this. This is actually knowledge that more people in my company need to know and have available to them? Anyway, that’s one of the motivations for that feature in Fiddle, but it really helps to be able to just move a lot quicker and to scale if you can have a central place where you can keep all of your pricing. And the way that leads right into purchase orders is then, when you need to cut Pos, it’s not like you’re referencing some external spreadsheet in good cases or you’re combing through emails in the bad cases that we see.
Ken:
You have the pricing right there as you go to cut a PO, you can just select the pricing from that vendor. You can see if you’re qualifying for price discounts, so then you can make sure to maybe up your quantity a little bit so that you qualify. Just things like this, having that data at your fingertips is really important to be able to get the best prices and to be able to make decisions. One of the other points that a lot of people don’t think about is, if you’re cutting in your POs in an Excel spreadsheet or just a Word doc that you’re sending out, or even just an email, a lot of times when those things are actually delivered, what you want to do is you want to be able to reference the original PO and you want to receive against that PO so that you know you’re getting everything that you ordered, that then you paid for.
Ken:
And so having a system is really helpful for that way, where you’re literally receiving on the PO, “I ordered 1,000 units of this, looks like only 900 units came in.” Now you know, “Okay, I’m short here. Do I need to contact my vendor or is this all they’re going to send me?” When I get billed, I need to reference that PO so that I don’t pay for 1,000 units even though I only got a 900 delivered. Those types of things. That’s something that’s pretty core to Fiddle and one of the things that we help people with.
Jessi:
Yeah, no, that’s a great point. And I think it can even come into play because you don’t want to be leaving money on the table if you’ve been shorted on an order or if there’s damage, but also just from an audit process, if you’re a certified organic product or any of the certifications can have different looking audits. But I know for myself sitting through organic audits of like, “All right, you ordered this much on this day. Where’s the paperwork that shows that you receive this much?” “Oh, they don’t match. Where did that go?” And that becomes a compliance issue because if you’re organic, you could have sold that to someone else or it could affect your certifications.
Jessi:
So not tracking those things can really come to bite you later, and having a way to systematize that and make sure that it’s just all in one place will save you hours and hours in preparations for audits. And just during an audits, to be able to be like, “Oh, all my information is in one place. It’s a beautiful thing.”
Ken:
Yeah, and I think it also helps you from the other perspective where as you scale, you start to deal with more and more sophisticated clients, maybe wholesale customers that will need access to some of that data. So for instance, I know Target in the US and Costco, they have a little bit stricter level of quality that they expect from their vendors, and so they’ll deal with you for a little while, but if you’re really going to scale with them, they really do need to know that you’ve got your stuff together and that you’ve got your CFAs, you’re keeping all the records, you’ve got your certifications, and that you’re not just flying by the seat of your pants.
Ken:
We’ve seen a lot of people struggle as they try to get into like a Costco or a Target or a Whole Foods where if you don’t have your paperwork together, you’re not even really being considered.
Jessi:
Yeah, for sure. At some level those, whether it’s SQF or some sort of GFSI. I know Costco even has additional audits and addendums on top of those, and so it can become a lot if you don’t have all those places set up from the beginning before you really start to scale.
Ken:
Right, right. And in fact, one of our first clients, that was actually the consideration, was they were using spreadsheets and they were actually pretty fine with it. But when they went to Costco, Costco said, “We’re okay to do a little trial, but you really need to get your stuff together.” And so they came to us, not only for a central place for CFAs And all that documentation, but also for batch records. And that’s the whole other side of things, is if you’re involved in the manufacturing process in any way in terms of either you supply the raw materials to your co-packer or you manufacture in house, or even in some cases, if you’re kitting and bundling in-house, you need proper records of all of that to make sure that good manufacturing processes are being followed.
Ken:
And so a piece of what we do in Fiddle with our manufacturing background is that we can help to generate some of that documentation and to be able to provide an audit trail. So when a Costco wants to look at your paperwork for that manufacturing run that you did, you can easily pull that up and show it to them. So those things are pretty important. And the batch records, that’s pretty unique to food or beverage type space, but in startup CPG, that’s probably one of the biggest categories, is a lot of food and beverage type companies, anything consumable, that’s when these records become really important.
Jessi:
Yeah. And you touched a little bit on self-manufacturing and we talked a little about co-packing, I’m wondering if you could talk us through at what point should founders and brands start thinking about, all right, maybe I’ve built some spreadsheets,” the one company you mentioned, maybe you’re feeling like it’s okay win. What size should they be at before they start thinking, “All right, maybe I need a system.” Is there a threshold? Can it be super early? I’m wondering if you could just talk through when people should really start considering, maybe I’ll need an external inventory management system to help me with this.
Ken:
One of the big things is there’s certain triggers that we’ve identified here at Fiddle that make it where, okay, maybe you consider a system like Fiddle. And we’ve touched on a couple of them. So maybe you’re trying to get into big box stores, or you’re trying to ramp up your wholesale program, that’s where a system like Fiddle is important. If you’re stocking out of product, either the finished good, or the raw materials, or packaging, any piece of your product that’s causing delays, that’s where, okay, hey, maybe you need a system for this. Another one is if you’re hiring. A lot of people don’t consider that…
Ken:
The way I like to look at spreadsheets is actually, and maybe I just preface this, I love spreadsheets. And in fact, when we engage with a customer, I always want to look at their spreadsheets. I want to see how they’ve been doing this because it’s actually not that much different than what I do when I’m programming something, is like you’re building tools, you just happen to be building it with spreadsheet software. And you’re building tools with something that maybe wasn’t meant for what you’re using it for. You’re trying to turn like an accounting tool into a project management tool into an operations tool. And it just wasn’t really meant for that, so you run into struggles related to that.
Ken:
But I just have to say, I’m kind of a junkie when it comes to this, I always want to see how you’re running your company, how you’ve been able to build this amazing company using these spreadsheets. And then we look at them and we look at, “Okay, what do we need to do to turn this into something that can solve some of the problems that people run into? And so I think you can go ways, maybe you can get to half a million, maybe even a million dollars, maybe even a little bit further using spreadsheets. A lot of times though, people end up throwing bodies at the problem, which is you just hire people to manage your spreadsheets and that gets tough.
Ken:
Google Sheets actually made it a little bit better in that you can share sheets, so you can share information, that makes it a little more useful, but it’s still tough to get a historical data, somebody can change a number here and you don’t really know, it’s tough to get to, “Okay, who made that change? Why was it made?” That kind of stuff. And so you’re still flying by the seat of your pants, but I have to give it up. I respect spreadsheets and I know that they’re powerful and you can do a lot with them, and I’ve had my mind blown what people can do with them.
Ken:
The fundamental issue that I’m bringing up is it might be well and fine for you to be able to babysit this spreadsheet that you’ve been building, let’s say for five years, and that you’re very familiar with it and the ins and outs, but if you’re trying to scale and you’re trying to bring on more people to your team, and then you sit them in front of this really complicated spreadsheet that just scrolls and scrolls and scrolls, and you’re looking it tab 5,000 at the bottom of the spreadsheet, that’s really tough. It’s tough for anybody to load all that into their head and to get moving pretty quickly.
Ken:
And so a lot of times you want to look at a system like Fiddle when you really are ready to scale, when you’re ready to take it to the next level, you’re ready to build a team, that’s where Fiddle can really help you.
Jessi:
Yeah. That makes a lot of sense. And I think also, I know it, at LivBar, it was helpful for us. We focused on doing some of our inventory system implementation when prior to knowing some big orders were maybe down the line of like, “All right, there’s enough things in the funnel, something’s going to hit, let’s implement the system before we have so many purchase orders that we’re overwhelmed and that the documentation is piling up, let’s get that implemented.” Not in the middle of a rush or the biggest production day we’ve ever had. And I was so glad that we planned it like that because it just saved so much hassle to be like, “Okay. Was not slow, but a little slower.”
Jessi:
And then when the big orders came, it was like, “Oh, we already set up the system, everyone’s familiar with it.” We don’t have to be rushing to implement this and make it work in the midst of this big order that’s make or break it for smaller brands as you grow, you got to meet those big orders as they come in.
Ken:
Yeah, absolutely. And another big motivation to adopt a system is you’ve got accounting problems where it’s your numbers are all over the place, maybe you took investment in your VCs and your CFO and your accountant, your bookkeeper, they’re asking for certain numbers that just take you way too long to get to. And this is where I touched on with cogs and operationally, and decision making wise, it’s really tough to operate if you don’t know your cog, but just basic numbers. How much did you pay to that vendor? What do you owe them?
Ken:
Some of these are accounting related, but a lot of them are actually operational and it has to do with how much have you received, how many EPOs are outstanding, which vendors are you using most, why aren’t we using that other vendor who has a better lead time and can actually save us an inventory cost because we don’t have to plan for such a long period of time. There’s all these types of things that can really affect how you run your company. The reason I actually brought that up is because we’re running into a tax season, we’ve just gotten through the big holiday rush, through Black Friday, we’re catching our breath a little bit, but we’re running right into tax season.
Ken:
And so this is when we as a company have a lot of accountants who reach out to us and say, “Hey, my client really needs to implement something.” And if you think about it from their perspective is because the client just shared with them 20 Google Docs that they’re supposed to make sense of and do the accounting based on and it’s just really tough. And so accountants sometimes or CFOs, their big motivation is, “Okay, we need to figure this out and systematized it.”
Jessi:
Right. And when a brand’s at the decision point of, “Okay, we want to implement an inventory system, but we have no idea where to start. We got to go out shopping for inventory,” which may or may not be your strong suit professionally. What tips do you have for, obviously, we’re hoping that everyone’s heading to the Fiddle site in the show notes after this podcast, but I’m wondering about your tips for going out, shopping for inventory systems. What are red flags, what are good signs when you’re talking to a vendor? What are just big watch-outs and considerations that you should have as you go through the process when inventory management may or may not be your personal forte but you want to make sure you choose the right system for your brand?
Ken:
I feel like in a lot of ways, this is a perfect softball because this is the motivation for why Fiddle exists is that we found that a lot of the existing tools were pretty terrible and overly difficult to use. And fundamentally, it comes down to, is this something that my team can actually be successful implementing? A lot of the tools out there are cumbersome, they’re big. I know like a three-person team that is looking at implementing like a NetSuite or something, and it’s like, do you really think that you can be successful with that? I think NetSuite’s going to take another couple of people to your team just to run it?
Ken:
And NetSuite, actually, I have respect for NetSuite, I think that they do a lot of things well, it’s just you have to make sure it’s the right fit for your team. And so a lot of what we focus on at Fiddle is just, can we make a piece of software that’s a lot more approachable to the average person where you don’t actually have to have a PhD in supply chain before you can figure out the software? And so ease of use is a real big one because frankly how busy you are and if it’s hard for you to do this, you’re just not going to do it. You’re going to revert back to your spreadsheets or just not doing it at all.
Ken:
And so that’s a big one. One of the things that I always watch out for, not just in inventory software, but all software is I actually want to try it, I want to use it, I want to like click around and I want to really get my hands dirty. That’s the only way I know that it’s something I can use. I know one of our competitors, we heard from their salespeople that they don’t even like to show the software and they don’t want people to use it before they sign up. So if someone’s asking you for a $20,000 purchase order in order to buy this thing before you can even see it or click around, I think that’s a huge red flag.
Ken:
And then support, being able to contact people of the company and get help when you need it, I think that’s huge, especially in the early days. Hopefully you won’t be hitting them up too much, but in the early days, you need a lot of hand holding to figure things out and get all your data in there and stuff. Another one of our competitors, we heard that once they sell the software, they actually go dark for about 20 to 30 days, and that’s part of their strategy. And I think they look at it like, “Okay, we want to just force people to get in there and figure things out themselves instead of asking every little question.” But I question that strategy and I just don’t think that’s a very good user experience.
Ken:
So there’s things like that, but really it comes down to, you need to find a tool that’s a good fit for where you are as a company. It makes no sense to try to adopt like an Oracle or SAP if you are like a three-person team, that makes no sense all, software’s just too big for where you’re at as a company. Maybe eventually it might make sense, but not now. And so finding something that’s a good fit for where you are, I think is really important.
Jessi:
Yeah, that’s great. And maybe I’m biased because we’ve got ops nerd host of the podcast, but I definitely would encourage any brands, if you’re thinking about inventory system, definitely see a demo of Fiddle because I know once I saw the demo, I was like, “Where was this when we were implementing our system? I didn’t know this was an option.” Because the software that we had ended up going with, it felt like you needed a PhD to run it of like, oh my word, we had to make a like 20 slide PowerPoint of how to enter batch records at the end of the day, then we had to pay someone external to enter them because it was so complex.
Jessi:
And I was like, “This isn’t workable. We just need to be able to put in what’s happening and upload files.” And so I was amazed when I saw the Fiddle demo, I was like, “Oh, there’s all these integrations, there’s all these pieces. It’s user friendly.” I assumed that all inventory management software looked like it was 20 years old and it was like, “Oh this is a fresh interface that actually is intuitive.” Through the demo, I’m like, “If we click that, is it going to do that?” And he’s like, “Yep.” And I’m like, “Oh, oh, okay. My brain is tracking all of this. This is so cool.” So it’s definitely like I said, I’m a little biased as a little bit of a nerd, but I think it’s super cool system.
Ken:
Yeah. I think that’s exactly the response that we want, it shouldn’t be overly complicated. Sometimes these processes there is some complication in them, but as far as the software goes, we want to limit it just to the few clicks data entry, the fewest that’s necessary in order to do the job. And I think in this space too, it’s interesting, I think that, and this is what we’ve said in some of our investor pitches and it’s like, when I look out into the world, I actually think that this is absolutely true. When I look at where all the innovation has happened software wise or technology wise in this space, it’s all on the front end, it’s on the retail side where you’ve got options like Shopify and Amazon, it’s easier than ever to put up a storefront to sell.
Ken:
I remember 15 years ago when we were trying to do that, it was really difficult. In fact, we bought a business from somebody because they couldn’t figure out how to make the e-commerce side work. And we came in and knew how to do that, but it wasn’t easy. Today, you can spin up a Shopify site in an afternoon and you’re selling. All of that stuff on that side, lots of innovation, lots of innovation about how to get people to your website. You’ve got Facebook, you’ve got Instagram, you’ve got Pinterest, you’ve got all these different ways in order to get traffic.
Ken:
The part of this whole process that really hasn’t seen a ton of innovation is all the back office, supply chain side, where once you step into that and you look at the tools of available on that side, it really is like stepping back 20, 30 years. The software is really old and archaic, it’s difficult, it’s just a bad user experience. And so our mission as a company at Fiddle is really to try to bring some of that innovation that you see on the front side and that level of ease of use that you find in a tool like a Shopify and bring it to some of these backend tools, to the purchase order side, to the batch record creation side, to the inventory tracking.
Ken:
If we can keep that same level of complexity, we think that we’ve succeeded as a company, and that’s something that we’re always working towards.
Jessi:
Absolutely. And if someone is interested in learning more about Fiddle and implementing it at their company, can you walk us through what that looks like of maybe initially engaging the team and then deciding to purchase, and then how long does implementation take generally, are there any things to consider to set people up best for success through the process? Go on, what’s the customer journey through purchasing Fiddle?
Ken:
Sure. To contact us, it’s really easy, it’s fiddle.io. You just go there, there’s actually a little chat icon on the bottom, click on that, and you’re immediately talking to one of our team members. And we can point you in the right direction if it makes sense to set up a demo so that you can have a look at the software. That’s something that we can do really easily. We also have a Request Demo button right in the middle of the front page, just click that, fill out your information, and we’re happy to set up something for you. Now, in terms of what purchasing your inventory software looks like, we’ve purposely changed a few critical aspects of it.
Ken:
In the past you always had to sign some year contract or multiyear contract, you have to shell out a bunch of money upfront, we’re purposely month to month. We want to make it really easy for you to try us out and see if it works for you. If it doesn’t, then you’re not tied to any huge, long-term commitment. And we look at that as a way, it keeps us honest too to make sure that we’re always building software that’s actually useful to people because if we can’t keep you, then we’ll be out of business pretty quickly. And so we think that that’s a win-win in for the ease of purchasing and making the decision to give us a try, but then also it makes us make sure to keep our promises on our side and actually provide value.
Ken:
Now, in terms of actually moving forward, let’s say that you go to the website, you set up a demo, typically you’re going to look at a demo. Maybe you’ll have one or two or three demos to different members of your team. Then we set you up on a free trial where you can actually go in there and click around and kick the tires a little bit. And then we’ll just send you a sales agreement. And we just send it over, it’s electronic, you fill it out, and then you’re in Fiddle, you’ve got an account and you’re moving forward. And now we enter the implementation phase. We are really hands on when it comes to implementation. It’s really good for us to talk with you and to figure out your business and what we need to make sure to set up correctly in Fiddle for you to be successful.
Ken:
The idea is that while there are some things that you might do a little bit different in Fiddle than what you’re currently doing, we don’t want to change your whole process. We want to just fit right in line with what you already have going that’s working. And so we’ll set up, usually it’s three or four different onboarding calls where we will import your data, we will review the data, make sure it’s all uniform and it’s in good shape. For us to import in Fiddle, we usually take care of that for you. And then we just hold your hand as you start processing your POs and batch records, if we’re going to do batch records, work orders, tracking your production runs, that kind of stuff, putting in your sales orders that are coming in from your wholesale customers, any integrations that we need to do to your e-commerce.
Ken:
So we’re really hands on, but that’s usually how the process looks. And it’s usually within a month or two you’re off and running and you’re using Fiddle, hopefully saving yourself a lot more time and focusing on other areas of your business instead of maintaining that complicated spreadsheet. Anyway, that’s what it looks like. Was that what you were asking about?
Jessi:
Yeah. That’s super great. I’m also wondering if you could give us a quick pitch for your own podcast, The Physical Product Movement Podcast in case listeners are interested in checking out an episode.
Ken:
Yeah. The Physical Product Movement Podcast, you can search for it in any podcast player, it’s usually pretty easy. But really what we do is I love talking to people that are actually running their own businesses and people that have had the audacity to start a brand or start a business in this space. And I like to dig into the background of where were they at when they decided to start the business, what did they do, what are some mistakes they made, what are some things they did that led to success, and how were they able to grow?
Ken:
And I look at it, it’s honestly something, it’s almost a selfish thing for me because I’m just very interested in this, but I just think it’s one of these areas where there’s not a lot of knowledge about actually what to do and different strategies and tactics to use. And often as an entrepreneur in one of these type of businesses, it can get very lonely where you feel like you’re the only one struggling with these things. Anyway, it’s nice to talk to people, fellow operators, fellow founders, people that are in the arena actually putting up the good fight. And so The Physical Product Movement Podcast, and you can search for it pretty much any podcast player.
Jessi:
Awesome. Thank you. And I’m wondering if we could end on, so on Ken’s podcast, he asks his guests to share one of their favorite quotations. And Ken, I’m wondering if you could leave us with a word, it doesn’t necessarily have to be a quotation, but just some word of wisdom for founders, especially as they embark in this digging into some of these inventory and Physical Product Movement. Do you have some parting words of wisdom for us that you’d be willing to share?
Ken:
Yeah. Well, I’m a sucker for a good quote, and so one of my favorites is actually from Mark Twain, and he says, “Don’t let school get in the way of your education.” And it is one of these core things that I believe, which is, you always have to be learning. And in the past or some people still think this way that you have to go to school in order to learn. But the truth is, we’re in a great time in history when you can just learn things constantly from some of the best in the world. I always talk about the University of YouTube where you can really just look up any video and learn how to do something that maybe you didn’t know.
Ken:
Anyway, I think that running a business, one of the great side effects of it is that in order for you to build, let’s say that $100 million company, you have to grow into that type of person or that person that can run $100 million company, it requires growth and learning. And that’s one of the things that’s most exciting about it. Anyway, I think it’s just always be learning, it doesn’t have to be formal, it doesn’t have to be in school. There’s a lot of different resources and ways in which you can learn. So that would be my parting advice.
Jessi:
Excellent. Thank you. Well, thank you so much for coming on the show and sharing your wisdom and knowledge with us. This has been super valuable, just really appreciate your time.
Ken:
Yeah. Jesse, this has been great. It’s always good to talk to you, and maybe we’ll set up for our fourth interview sometime.
Jessi:
There we go. We’ll just keep doing podcast interviews.
Ken:
Yeah. Sounds good to me. It’s good to talk to you. I appreciate it.
Jessi:
Thanks for joining us. Special thanks for this episode to our partner Fiddle. You can visit fiddle.io for more information and links are in the show notes. This Startup CPG Podcast is executive produced by me, Jessi Freitag. The music is by The Super Fantastics. We’d love to have you join our community of founders and experts. Get the invite at startupcpg.com. And don’t forget to subscribe to this podcast on Spotify, Apple Podcast, or wherever you’re listening right now. It’s the easiest way to help us grow our community. See you next time.
