Manufacturer Ditches Paper Invoices, Reaps Big Savings

By  Jessica Binns — September 06, 2011

When you’re a mom-and-pop company, choosing to go wireless for the first time can be a big deal—but can also reap substantial savings.
 
Santa Cruz Pasta (SCP), a four-year-old small producer of fresh pastas, sauces, and spreads in northern California, recently rolled out Intermec CN50 handhelds and PB51 printers to its three drivers who deliver the company’s products to about 45 local grocery stores and farmer’s markets.
 
Steve Simmonovich, owner of SCP, says he’d been thinking for a while about going mobile and moving away from paper process, largely to reduce costs by eliminating paper forms and improving data accuracy. Beyond that, however, relying on paper processes was limiting how the company could grow. “With a technology solution, we could continue growing without hiring another driver and adding another van,” Simmonovich says.
 
Simmonovich’s research into device options was simple. “I saw other drivers making deliveries and looked at the brand names of the devices they used,” he explains. “Intermec kept popping up.”
 
Intermec introduced SCP to MSA Systems, a provider of enterprise hardware and software. Together, the two vendors identified SCP’s most pressing needs and challenges. “My biggest problem was invoices,” Simmonovich says. “They run $0.28 for paper costs per store.” Multiply 45 accounts by two deliveries weekly, and those costs add up.
 
“We’re saving $25 per week in invoicing costs,” adds Simmonovich.
 
The Intermec devices also help to improve data accuracy. “Our bookkeeper would notice an error five or six days after the delivery,” says Simonovich. “Sometimes it was in our favor, and sometimes it was in the store’s. But you can’t go back and say ‘We had a $5 error—it’s just not worth it.
 
“We were losing $250-$500 a month in mathematical errors,” he adds.
 
And when you factor in the labor costs, the numbers keep piling up. SCP relies on QuickBooks to manage its financials. “It took five to seven hours a week just to enter invoices. Those costs for our bookkeeper add up,” Simmonovich says.
 
Driver productivity has also ticked up but Simmonovich says it’s hard to empirically measure those gains. “We were getting to a point where we couldn’t add another grocery store account. With the next one we got, I’d have to hire another driver and van,” he explains. “I found myself going out with my personal minivan and making deliveries until I could justify another route.” Now, drivers can squeeze in another three or four stops each day.
 
Simmonovich says he looked for durability, long battery life, and speed of data processing and transmission when evaluating handheld devices. So far, the CN50s have met his expectations. “Our employees work 10 hours in the field. I don’t know what the battery life is but it’s longer than what we need,” Simmonovich says. “I’ve dropped the device and it survived. It’s built for the field.”
 
Thanks to their GPS capabilities, the handhelds have saved Simmonovich from constantly printing out driver routes via Google Maps. “We can program our routes right into the CN50s,” he says.
 
Moreover, the SCP owner says he’s only tapped into a fraction of what the device can do. In the future, he plans to leverage the tracking capabilities to better monitor the drivers.
 
The MSA software has performed well for SCP. “They developed a software that’s easy to use, fits our needs in the field, and fits our needs in the office in terms of interfacing with QuickBooks,” says Simmonovich. “Now, we simply sync the device with our computers and it takes a minute to transfer data.”
 
SCP has been in talks with Costco about becoming a supplier but the wholesale chain requires its partners to have traceability capabilities in case of a recall. Simmonovich says MSA’s software has those raw materials inventory management capabilities built in.
 
Finally, Simmonovich plans to transition other processes to the Intermec handhelds. Drivers currently use Excel spreadsheets in the field to help manage what product is in their trucks. They’ll eventually have that information on the devices.
 

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