Drop-shippable goods cater to online consumers
May 30, 2013,
HIGH POINT - Many home entertainment suppliers are thinking inside the box these days.
Specifically, the box used for ground shipping dropship orders from online retailers. That means engineering entertainment units to stay under the UPS oversize category - 130 inches in a length and girth formula and 150 pounds - beyond which large-package surcharges can start.
Rethinking design is just one way suppliers are catering to a customer who's increasingly comfortable ordering television stands or consoles online. But there's a lot that goes into giving consumers a good out-of-the-box experience.
Walker Edison made its name as a supplier to e-commerce retailers in the mid- 2000s as flat-screen televisions became more affordable. The company now offers about 45 entertainment groups that are drop-shippable and certified to ship UPS.
Recently it has grown its business as a solution for furniture stores with a multi channel approach to sales.
"For the retailers who don't have a big e-commerce presence, they all want a big e-commerce presence. It's the one avenue that still remains pretty untapped for a lot of these retailers. It's something that they're searching for," said Brad Bonham, president.
Walker Edison's design process has mirrored the evolution of the television screen.
In 2005, the increasing affordability of 42-inch plasma televisions at about $1,000 drove sizing, Bonham said. As affordability now improves for 60-inch and larger televisions, the company is developing units to accommodate bigger sizes.
But that presents problems because often, entertainment stands can max out at about 60-inch lengths.
"In order to ship a 60- to 70-inch console, you almost have to reverse engineer the design in order for it to fit in a box that is UPS-able. And that's what we do really well," Bonham said, adding that the company has two engineers on its staff to make sure items fit ground ship parameters.
At this summer's Las Vegas Market, Walker Edison will add 10 new 70-inch drop ship consoles to the four currently in its line. Each 70- inch unit ships in one box, Bonham added.
Karl Eulberg, president of E-Ready, an e-commerce centric supplier that debuted in High Point last month, reiterated the importance of discipline when designing product for the online channel. While shipping in multiple boxes is an option, keeping the number of boxes to a minimum is part of the channel's value proposition, he said.
"It doesn't mean that you can't make a box bigger than a certain dimension, but you have to decide how many cartons it's going in and how to effectively get it to drop ship at the lowest price while you're in design," Eulberg said.
As the cost of shipping multiple boxes begins to approach a significant percentage of wholesale item costs - 50% for example - there's not much value in drop shipping, he said.
|This Lynden console from Southern Enterprises Inc.
is drop shippable. It includes an electronic fireplace
insert and media components storage.|
is a dropshippable
inches long to
"People complain when things are really hard to assemble or confusing or they don't go together well," Eulberg said. "If you look at low rated RTA products online, whoever they're from, oftentimes the complaints are around that it was way harder for them to assemble, or the instructions were poor or the parts were a mess. It also will increase your returns."
Walker Edison is developing a scaling system that rates how easily each of its items can be assembled so consumers understand assembly times.
Southern Enterprises Inc. (SEI), mostly a supplier to Internet retailers, focuses on developing products that take less than 20 minutes to assemble. The company has done well with 48- to 52-inch console sizes, even though it offers smaller and larger units, according to Jim Schmidt, senior vice president of marketing and merchandising.
More than 90% of SEI's home entertainment pieces are drop shippable with items between $299 to $499 drawing the most consumer interest, he added.
Sunny Designs offers about 25 RTA drop ship entertainment units and has been in the category for about a year and is doing well with 52- to 62-inch console units, according to Annabelle Go- Eisler, marketing director. The move included adjusting in-line pieces for assembly with cam locks.
|These boxes with reinforced corners from Sunny Designs
show one of several approaches to limiting damages in
drop shipping. Corners are one of the most likely places for
damage to occur, so the company strengthens them with Vboards,
a rigid cardboard.|
|This E-Ready Belcourt corner television stand accommodates flat-panel TVs of up to 60 inches.
It has an electric fireplace insert with adjustable heat settings, a 12-step cherry finish and oiled
brass knobs, open media component storage and ventilated back.|
Go-Eisler said assembly of Sunny Designs RTA entertainment units takes about 20 minutes with a single tool. The company has developed online videos to give consumers a visual aid.
One of the reasons the online sales channel is growing is because consumers' perception of RTA has changed as they became more accepting of products from stores like Ikea, she said. But she added that shoppers are "looking for better quality than what Ikea is offering," which is where Sunny Designs comes into the picture.
E-Ready's Eulberg said younger generations don't associate RTA with lower priced laminated goods the way previous generations do. That's one reason his company decided to market better quality - with features like 12-step finishes, dovetail drawer boxes, finished backs and inset molding on side panels.
"Younger consumers accept the fact that they have to do some assembly on their product and they've had in their lives through Ikea and others. So they don't automatically put the fact that it's not assembled into a different quality category," Eulberg said.
"If you look at RTA furniture in Europe, RTA is pretty standard. Everything comes ready to assemble and people over there are very focused on quality. They want solid woods and higher quality and they totally disassociate assembly from quality."
So who is the consumer for drop-shippable home entertainment pieces? SEI's Schmidt said it's often those who don't have much access to traditional stores. They could be in cities where finding furniture retailers isn't easy, or where retail space is expensive and thus, so are goods. Consumers in rural areas might have few stores and little selection, and find it necessary or convenient turn to the Internet, he said.
"Some of the things we take for granted in suburbia are not available to everyone," he said. "You go through the trouble of going to a store and it just doesn't have that product that you're necessarily looking for. The Internet offers the opportunity to do an awful lot of shopping across a lot of design styles."
Companies are developing brands that online consumers can look to for specific shopping solutions.
Last year, SEI launched its Holly and Martin brand, taking aim at 25- to 35-year-old millennial women who shop online, live in small spaces and "are looking for solutions but are not looking for matchy-matchy solutions. They want more things that coordinate and add character to their space," Schmidt said.
"Building that entails developing the brands, the merchandising and product development around it. Not just being anything and everything, trying to have a reason for being," he said.
He added that the Internet can offer a better platform than a traditional store for educating consumers on the details or functionality of a product.
"When you're a retailer," he said, "you've got about three or four seconds to really catch their attention and hope that they understand what you were trying to achieve in the design and also functionality."
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