SIZE MATTERS, at least if you are a merchant facing two related challenges: first, significantly expanding your product offerings, and second, being stuck with a facility located in the most densely populated area of North America.
Garrett Wade Co. Inc.’s product line of specialized, high-quality woodworking tools and accessories may spark associations with a quaint, old-fashioned countryside wood workshop. But since customers first flipped through its catalog pages in 1975, the retailer has cherished the Big Apple as its hometown. Through the years, the New York City-based company has continued to offer its wood-loving clientele a unique selection of tools from all over the world: a Stanley (U.K.) screwdriver, a Japanese mortise chisel, a Swedish Tormek grinder.
“I think a lot of people are getting tired of the Home Depot- and Wal-Mart-like low-quality tools and products that are inexpensive, poorly made, and don’t feel great in your hand,” says Craig Winer, vice president of Garrett Wade. “One of the most important things Garrett Wade is trying to do, and [that] I hope we do well, is to find and sell products that are unusual, well-made, and simply more soulful.”
Three or four years ago, he adds, shoppers looking through the Garrett Wade catalog “would have found products that they thought were very neat and interesting, but probably not many products that that they could actually use. We have changed that by bringing in products more people can identify with.”
Not surprisingly, the customer base has grown hand in hand with the company’s wider product range, increasing roughly 15% to 20% a year. In 1999 the company had 57,000 customers. Four years later, 116,000 people shopped through the catalog or Garrett Wade’s Web site.
Garrett Wade has continued to inhabit the same two-story location in New York’s SoHo area from which it began its operations nearly thirty years ago, when founder Garry Chinn left an investment banking job to pursue his love for fine woodworking tools. Today, just as then, the 18,000-sq.-ft. space hosts not only the company’s offices but also its warehouse, call center, product showroom, in-house photo studio, and shipping facility. All 3,500 SKUs — including some 1,500 spare parts for older products — are located here.
During the 2001 holiday season, with days in which up to 700 orders had to be fulfilled, the walls finally began to bulge. “All of a sudden we were mailing heavily, we were growing steadily and, well, what worked before just didn’t work anymore,” Winer recalls.
By the spring of 2002 the company decided something had to be done. Moving to a new location was not an alternative, however, since Garrett Wade had a lease until 2006. “We simply wanted to find some creative solution that would enable us to stay at least to the end of our lease,” explains Winer.
Enter CDM, a Cambridge, MA-based engineering and consulting firm. Senior manufacturing and logistics consultant Ted Elkins began analyzing the warehouse, workflow, products, and picking and packing processes, looking for ways to improve space utilization and flow.
CDM brought several solutions to the table. For example, it decided to reorganize the retailer’s receiving and bulk storage areas, turn a chunk of the showroom into warehouse space, and move the shipping area to improve the workflow. These changes included installing new racks in the warehouse and reorganizing products according to SKU velocity. Finally, a new roller conveyer belt system was installed, all while Garrett Wade was in full operation.
In addition, the retailer decided to replace the existing stock number sequence with warehouse bin locations. Winer recalls this switch as the biggest roadblock in the process, but once the new bins were in, product flow improved dramatically. Best-selling products were moved to the front of the facility, making pickers less liable to constantly have to run up and down between the first and second floors. The changes also gave packers a larger work area. “In the past,” notes Winer, “the packers had had to wait for the pickers. Now, we suddenly had a continuous system where packers were able to just bang out packages.”
Garrett Wade also upgraded its proprietary warehouse and order management systems with the help of app provider Quality Software. “Our systems are relatively maintenance-free,” Winer points out. “A lot of bigger companies have Windows-based systems, but we still use the old green screens, and the nice thing about that is that we don’t have to deal with many things crashing.”
Today, Garrett Wade’s warehouse can hold up to twice as many products as before, and the new picking and packing processes have tripled output. The in-house call center receives catalog orders, and the retailer has just finished rolling out an outsourced, 24-hour call center to further improve customer service. Web orders, which account for 28%-30% of all purchases, are downloaded several times a day, and online inventory is updated daily.
“Today, one of the great rewards is that orders can be shipped the same day,” says Winer. “I think we have made the shift from a not-high-volume to a relatively high-volume company. But of course we are not high-volume if you compare us to many other companies. I am sure L.L. Bean, for example, would not be impressed.”
Neither might Home Depot, but then again when was the last time Winer set foot there? “Actually, a couple of months ago,” he confesses. “My wife and I went there to buy some molding.”
“But no tools!” he cries. “We didn’t get any tools!”
Margareta Mildsommar has covered retail IT technology in the U.S. and abroad. She can be reached online at email@example.com.
According to Garrett Wade vice president Craig Winer, “One nice thing about being a small company is that you get involved with all kinds of stuff.” In the last four years, Garrett Wade has moved beyond its specialty tool label and introduced unique toys and kitchen accessories, as well as gardening and outdoor tools, to its shoppers. “We are going the extra mile to make sure we still carry things we carried many years ago and to make sure we always have a couple around,” says Winer.
Garrett Wade’s all-in-one location hosts only 33 employees, but many of them wear several hats. Winer, for example, manages the general day-to-day operations, is occasionally responsible for product searching, does the marketing, and lays out each product catalog. He also styles the products before each photography session. And, of course, he tries them out. “Every time we get new product samples shipped to us, we are like kids around Christmas.”
Headquarters: New York City
2003 revenue: Under $10 million
Total employees: 33
Web site: www.garrettwade.com
Space: 18,000 sq. ft.
Customer base: 116,000
Catalog: 100-page catalog sent six times a year to 450,000 households
Average order size: $130
Average orders per day: Between 400 and 750
Web site host: Multimedia Live, Petaluma, CA
Warehouse and inventory systems: in-house, developed and maintained by Quality Software, Spring Valley, NY
Conveyor belt: FKI Logistex™ Alvey Systems roller conveyor