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January 16, 2023

Northern Tool + Equipment achieves faster delivery by transforming its supply chain infrastructure

Northern Tool + Equipment is a manufacturing and omnichannel retail business with 130 stores across the United States. Hampered by a fragmented supply chain infrastructure, the company wanted to offer faster delivery and more precise delivery dates for a better customer experience. The company is rolling out the intelligent order management capabilities from Microsoft to provide a frictionless experience that guarantees faster, more reliable delivery times, so its customers get the tools and supplies they need when they need them.

Northern Tool - Equipment

“Working with real-time data, we use the intelligent order management capabilities from Microsoft to offer reduced lead times and accurate pricing with a higher level of confidence.”

Dennis Rouland, Senior Director, Business Program Leader, Northern Tool + Equipment

Too many kinks in the supply chain

For Northern Tool + Equipment customers, order delays are not an option. “We’re a company that serves people who do the tough jobs, people who use their tools for their livelihood,” says Shaun Bunch, Senior Vice President, Supply Chain Operations at Northern Tool + Equipment. “They’re the ones that need the job done right with the best tools possible to support their families and the communities they’re in.” More than just a retailer, this family-owned business uses customer insights and analytics to design, build, and test their own manufactured products and equipment to meet the growing needs of a diverse customer base.

Northern Tool + Equipment was facing challenges to stay competitive across its full network of stores and distribution centers. Because of a fragmented supply chain technology infrastructure, online and in-store product orders were hampered by long lead times. Most products on the company’s website and in-store digital showroom listed 4–7 days for delivery, resulting in lost sales to competitors offering delivery in 1–3 days. Additionally, the company could not provide a firm delivery date, only a range of dates, leaving customers to make assumptions about when orders might arrive. The company needed to transform its supply chain technology infrastructure to provide customers with fast turnaround and accurate order information. 

With over 100,000 products available online and in stores, the Northern Tool + Equipment team members had their work cut out for them. Many of the company’s products are large, like generators and air compressors, whose size and weight add further complexity to the process of fulfilling customer orders in a timely manner. 

A solution that connects all the disparate pieces 

Northern Tool + Equipment turned to Microsoft for help with its supply chain challenges. “We needed a technology provider that could give us an end-to-end solution. One that lets us be a retailer and focus on selling and building relationships instead of building individual components and platforms that we then have to stitch together and erase all that friction,” says Nate Miller, Vice President, Digital Evolution, Direct & Operations at Northern Tool + Equipment. “Microsoft was a collaborator who could bring us that solution.” 

Wanting not only to meet, but to exceed customer expectations, the first step was solving the problems caused by the fragmented supply chain. “We had to untangle the mess,” says Bunch. “You can really quickly connect and disconnect the products that Microsoft has across its cloud portfolio, which has been helpful for our ability to make decisions without creating strains on the business.”

The intelligent order management capabilities from Microsoft give organizations the ability to manage order fulfillment across different platforms and apps. With the company’s supply chain infrastructure impeded by piecemeal vendor systems bolted on over the course of a decade, Microsoft was a great match. “We're working with Microsoft in our retail stores for point of sale and through our distribution network to get products to customers as quickly as possible for a seamless experience,” says Miller.

With Microsoft technology, designed to create a more resilient and sustainable supply chain through an open, flexible, collaborative, and secured platform, Northern Tool + Equipment can connect its entire infrastructure into a single, frictionless system. The company can achieve full control and optics across the entire supply chain and scale up or down as necessary, also giving its customers full visibility into order status. “What’s great is the ability to be able to understand up front how that movement is going to happen,” says Bunch. 

Faster and more reliable delivery times due to greater operational precision

Well on its way to achieving faster and more reliable shipping, Northern Tool + Equipment is looking beyond just connecting all the fragmented systems. The company wants to use its relationship with Microsoft to employ additional integrations that will enhance the customer experience even further. One example is a project where Northern Tool + Equipment is working with shipping partners like FedEx to build seamless fulfillment into the order management process. Customers now benefit from faster deliveries, and the company is seeing a financial boost due to greater operational precision and increased efficiency.

“Not only can we offer customers faster shipping speed on products, but there’s a cost benefit as well,” says Dennis Rouland, Senior Director, Business Program Leader at Northern Tool + Equipment. “Working with real-time data, we use the intelligent order management capabilities from Microsoft to offer reduced lead times and accurate pricing with a higher level of confidence. When we're utilizing all of our inventory across our distribution network, we save a lot—it's employee efficiency; it's less cost and reliance on external partners; and, it's reducing travel and fuel.”

Northern Tool + Equipment will be able to provide customers with a committed delivery date and shipping costs to ensure a 1–2-day delivery within a specific proximity of its stores. Customers will have increased visibility into real-time inventory availability on NorthernTool.com, so they can choose the delivery date and shipment price that is right for them. "We're integrating technology to be able to get the best real-time costs and real-time service level opportunities with our trucking, and Microsoft relationships are shaping the industry in a way that is helping us," says Bunch.

Going forward, Northern Tool + Equipment expects to gain increased online growth, increased conversion of orders due to shorter lead times, reduced shipping costs, and improvement in customer satisfaction leading to increased repeat purchases. “We were spending too much time integrating and stitching together different platforms to eliminate customer pain and friction,” says Miller. “With Microsoft technology being an integrated solution, we can focus on taking care of the customer, which is where we should be spending our time. I’ve always been concerned about how a company like Northern Tool + Equipment would be able to compete with Amazon in terms of delivery. Microsoft supply chain solutions put us in the game.”

Find out more about Northern Tool + Equipment on Twitter, Facebook, and LinkedIn.

“We're integrating technology to be able to get best real-time costs and real-time service level opportunities with our trucking, and Microsoft relationships are shaping the industry in a way that is helping us.”

Shaun Bunch, Senior Vice President of Supply Chain Operations, Northern Tool + Equipment

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