Cosmetics firm touches up its electronic shipping system

A Canadian company specializing in handmade cosmetics is preparing to give its logistics operation an IT makeover.

Lush Canada is in the testing phases of a custom implementation of Red Hat Interchange, an application a company

official said will electronically connect its inventory, stock keeping and order fulfillment. It will also make things easier for the shipping of its bath and shower products, which is handled by United Parcel Service (UPS).

Sam Azad, Lush Canada’s Web master based in Vancouver, said the system will replace some of the manual work that is done when the company takes or places orders.

Right now, Lush generates shipping documents and labels through a standalone UPS terminal. At the end of the day, before the UPS driver picks it up, Lush uploads all the data to UPS’s main server. Along with the package goes a printed manifest — a list of the package contents and their value — a copy of which uploaded to the server.

Once the Red Hat Interchange-based solution goes live (it’s in beta now), Azad said the company would have most of the capability that an electronic retailer like enjoys. “”It will even tell when to order product to replenish our inventory,”” he said. “”It will also track customer behaviour to include their history, plus the shipping module fits in. We’ll be pulling all the shipping rates and from UPS’s server.””

UPS’s cross-border services are handled through Fulfillment Systems International (FSI), which it acquired two years ago. Pat Whalen, FSI’s founder and chief executive, said companies like Lush are a sign of changes within its customer base. “”There used to be a lot of them that preferred to send orders by fax — we’d get these handwritten things,”” he said. “”That’s not really an issue anymore. In fact, we finally got so that we charged them more to fax order information back to them. We really pushed them to use the Web site. Just a week or so ago we finally called some of those customers who had said two years ago they still wanted information faxed to them, and when we told them they were getting it that way, they were like, ‘What?’ They don’t want it anymore.””

Azad said the cross-border services allow Lush to tap into U.S. ground rates that are substantially lower than in Canada. Packages are labelled in Vancouver but entire pallettes are sent down to UPS’s Blaine, Wash. warehouse, where they can be picked apart, packed and shipped to customers.

“”We are cutting down all the customs problems,”” he said. “”The distribution is easier. Every single package doesn’t have to go through customs.””

Lush’s Red Hat Interchange system is complete but still in the testing stages, Azad said. Once it’s available online, he said its database will be updated every few hours. “”Even our customers will be able to track their packages,”” he said. “”They will have their own account.””

Whelan said FSI and UPS are offering customers their own virtual warehouse solution whereby they can check order status and shipping status through a password-protected account on the UPS Web site.

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