Microsoft Windows MobileCustomer Solution Case Study

Beverage Distributor Improves Mobile Access, Cuts Daily Route Accounting by

OverviewCountry or Region: United StatesIndustry: Consumer goods

Customer ProfileSchenck Company is the premier distributor of fine beverages in the central Florida region. It represents more than 30 suppliers in six counties. Its 535 employees serve more than 5,000 customers.

Business SituationThe company’s IBM AIX-based route automation system had become unreliable, resulting in lost orders and inaccurate point-of-sale information. The system also did not meet Schenck’s reporting and mobile-computing needs and was very inflexible and expensive to modify.

SolutionSchenck replaced the system with eoStar route management and route-accounting software based on the Microsoft® .NET Framework. The solution includes a mobile component that runs on Windows Mobile® powered smartphones.

Benefits More empowered sales force Quicker daily route accounting Increased sales volume without

“…[N]ow with eoStar running on Windows Mobile powered smartphones, our business opportunities and objectives are not dictated by what our route automation software can do—they’re enhanced by it.”Kym Merrill, Chief Financial Officer, Schenck Company As one of the leading beer distributors in central Florida, the Schenck Company found that its proprietary IBM AIX-based route automation system was limiting its business. Transmitting orders electronically was difficult, and orders were frequently lost. Salespeople and drivers lacked real-time inventory and price information, so daily account settlements were often complicated and time-consuming. In addition, many reports had to be created manually. The distributor decided to replace its system with Rutherford & Associates’ eoStar Route Management based on the Microsoft® .NET Framework and Windows Mobile® software. The openness, reliability, flexibility, and cost efficiency of this solution enabled Schenck to empower its sales force, reduce route-accounting time, absorb increased sales volume without adding employees, streamline reporting, and reduce hardware costs.

SituationIn 1954, when Jay and Virgil Schenck founded their beer distribution company in Orlando, Florida, they were the youngest appointed distributors in the history of the Miller Brewing Company. Over the years, the Schenck Company territory expanded and added product lines. As of 2006, the company represents 30 suppliers of beer, wine, and other beverages throughout six central Florida counties. Schenck has 535 employees, including 95 field salespeople who handle its largest customers, three telephone salespeople who take care of smaller customers, and 105 drivers, as well as workers who handle invoicing, inventory, and warehouse management.

The Schenck business model is to presell products and then deliver those orders the next day to its more than 5,000 customers. The company serves both on-premises customers (where the beverages are consumed on-site, such as restaurants and taverns), and off-premises customers, such as grocery stores and gas stations. Each type of customer has different requirements and different pricing.

Until 2004, all of Schenck’s orders, invoices, inventory, and reporting were handled through an IBM AIX–based route automation system running on RISC/6000 servers. That system only supported File Transfer Protocol (FTP) data transfers, so it wasn’t possible to securely transfer orders and pricing information over the Internet. The field salespeople called on customers and entered orders into an HP iPAQ Pocket PC,

which connected to a Nextel mobile phone, which connected to the Schenck network through a modem pool. From there, the orders were uploaded through FTP into the company’s route-accounting system.

The salespeople were encouraged to transmit orders throughout the day. However, because of the difficulty of using the modem pools and Nextel mobile phones, and the slow trans-mission speed, many waited until the end of the day to dial in, which would swamp the six modems. Those who couldn’t connect to the network had to drive to one of three Schenck offices in the central Florida area to connect their iPAQs directly to the network. “Some of our salespeople are 60 or 70 miles away from the office, so this really added a lot of time and travel to their day,” says Mike Maguire, IT Support Specialist for Schenck. Even if the salespeople were able to transmit their orders through the modems, often the orders were not received by the AIX-based system. In that case, the next day Schenck had to send extra delivery trucks to fill in the missing product.

The salespeople used iPAQs to enter orders but didn’t have inventory information. Therefore, when they entered an order at the customer site, they were required to assume that the inventory was available to cover it. In addition, although they had pricing information on the iPAQs, last-minute changes or promotions weren’t available. As a result, there was often a discrepancy between the price shown at the time of order and the price reflected in the actual delivery.

“With eoStar, we can communicate much more sales history, route, and live inventory information to our people in the field, which makes them more efficient.” Kent Meckley, IS Manager, Schenck

As a result, Schenck drivers often found that they were missing part of an order or had the wrong price on the invoice. The drivers were equipped with Norand portable data terminals, which they used to track deliveries and payments, and print invoices. The Norand system didn’t allow drivers to make any changes to orders, however, so they couldn’t print corrected invoices. At the end of their delivery shift, the drivers had to settle with the route-accounting department, a process that took 30 to 35 minutes due to the order discrepancies.

The system also fell short of Schenck’s reporting needs. Operating in a heavily regulated industry, Schenck is audited at various intervals by the state and federal government and suppliers as well as by its internal accounting staff and an external accounting firm. Reporting with the IBM RISC/6000 solution was very inflexible and time and labor intensive. “Before, when I would ask for reports, we just couldn’t do it with the old system,” says Kym Merrill, Chief Financial Officer for Schenck. “If the report wasn’t already created, we couldn’t create it because the system wouldn’t let us at the data to write it. We wound up writing a lot of internal applications and using a lot of Microsoft® Excel® spreadsheets. That required us to hire people simply to handle the manual entry so that we could get the information that we needed out of the system.”

In addition to addressing these limitations, Schenck needed to be able to easily—and economically—meet the requirements of its ever-changing business environment. Be-

cause the IBM AIX route automation system was based on a proprietary architecture, modifications were almost impossible or very expensive and took months. It was clear that Schenck needed a new route automation system that: Was more reliable and quick to

modify Supported real-time, two-way

communication of sales and pricing data

Safeguarded data transmission over the Internet

Offered flexible, efficient, and robust reporting capabilities

SolutionWhen the Schenck information services (IS) staff began to look for a new, more flexible route automation solution, they received several recommendations. Interestingly, all the recommendations pointed to the same solution—the eoStar route management solution from Rutherford & Associates, a Microsoft Certified Partner. The eoStar solution integrates all aspects of distribution, route management, route accounting, mobile sales, and reporting into a single package based on the Microsoft .NET Framework (an integral component of the Windows® operating system that provides a programming model and runtime for Web services, Web applications, and smart client applications) and the Microsoft SQL Server™ database system.

The Schenck IS staff members first set up a Web-based demo of eoStar with Rutherford, which convinced them that the solution was worth pursuing. Next, Rutherford presented an on-site demo for Schenck company

“With real-time inventory and pricing information, we can give a much more accurate estimate for the total invoice cost at the time of the

executives, which was greeted very positively and gained the approval to test eoStar in Schenck’s real-world environment.

Schenck set up a pilot that included about 50 users, most of whom worked on route accounting or other accounting functions. The test also included warehouse managers, and a few key drivers and salespeople to evaluate the mobile side of the solution. “We spent six to eight months testing eoStar and doing a very in-depth analysis between it and our previous solution,” says Merrill. “We were pretty specific and detailed about what we wanted, and Rutherford delivered.”

Rutherford was able to easily integrate eoStar with Schenck’s Sage MAS 200 accounting system and with legacy load-planning and data warehouse automation applications, as well as with the systems of Schenck’s suppliers by quickly writing plug-ins to those systems. Rutherford was also able to easily add fields to the user interface to meet Schenck’s specific business requirements. “If Schenck needed to provide new information to the drivers or the salespeople using a mobile device, we could add that capability within a month without having to revalidate the product top to bottom,” says Jovo Filips, Vice President, Sales & Marketing for Rutherford & Associates. “With the IBM AIX system, that would have taken six months to two years, and then Schenck would have had to revalidate the entire application.”

After about 10 months of testing and refining the solution, Schenck put the

eoStar solution into production in June 2005. “The product we went live with was greatly enhanced, even compared to the one we had seen originally,” says Kent Meckley, IS Manager for Schenck. “Rutherford proved how fast changes could be made with this new technology and how the flexibility that comes with the .NET Framework and SQL Server could make our lives easier.”

The eoStar Server application runs on the Microsoft Windows Server™ 2003 operating system and integrates with Internet Information Services (IIS) and SQL Server 2000. The solution calls on IIS Web services to handle communication between the server and mobile devices. Schenck office workers at the company’s three main locations use a Windows smart client on their desktop computers to access eoStar tools.

Field salespeople, delivery drivers, and warehouse workers use eoStar Mobile on a variety of Windows Mobile® powered devices. Schenck’s 95 salespeople use Verizon Audiovox 6600 smartphones running Windows Mobile 2003 software to access real-time pricing and inventory data and to transmit their orders throughout the day to the eoStar system over the Verizon EVDO network. These Hypertext Transfer Protocol (HTTP) communications are encrypted with a private key from the eoStar system. In addition to exchanging sales data, the Windows Mobile powered smartphones also enable the salespeople to access their e-mail and calendars.

Schenck’s warehouse and delivery drivers use Windows Mobile powered

Schenck field salespeople access up-to-the-minute inventory data from Windows Mobile powered smartphones.

Intermec 750 series Pocket PCs. At the beginning of their delivery shifts, the drivers load the latest pricing and list of deliveries onto their Pocket PCs. The drivers print invoices at each cus-tomer site on Bluetooth-enabled printers and, if necessary, can adjust an invoice to reflect a difference in price or in the quantity delivered. The eoStar software also supports elec-tronic signatures. When drivers return at the end of the day to one of the Schenck offices, they dock their Pocket PCs into ActiveSync®-based docks or multiple-port Intermec docks to upload the results into the eoStar system over an internal Ethernet network.

BenefitsBy choosing a route automation system based on the open architecture of the .NET Framework and Windows Mobile software, Schenck was able to improve the productivity of its sales force and drivers, reduce administrative overhead for route accounting and reporting, and expand its capabilities.

More Empowered Sales Force The new Windows Mobile–based eoStar solution provides Schenck salespeople with more accurate information, so they can serve customers better. “With eoStar, we can communicate much more sales history, route, and live inventory information to our people in the field, which makes them more efficient,” says Meckley.

Schenck salespeople can use their smartphones to check whether an item is in inventory and whether a discount is available, which results in more accurate orders. “With real-time

inventory and pricing information, we can give a much more accurate estimate for the total invoice cost at the time of the sale,” says Charles Hatcher , Dist r ict Sales Manager at Schenck Company. “It’s also helpful to be able to delete items that have a zero quantity ordered. That way, if the totals on the route card and Pocket PC do not match, we can delete all of the nonordered items and quickly check what we missed.”

In addition to delivering the eoStar capabilities, the Windows Mobile powered smartphones also enable salespeople to access e-mail and text messaging. Instead of carrying a BlackBerry device, a Pocket PC, and a mobile phone, the salespeople now gain more mobile capabilities than they had before with just a Windows Mobile powered smartphone. The smartphones give the salespeople access to enterprise line-of-business applications, which the BlackBerry devices did not. And, the increased reliability of transmitting their orders over the Internet with the smartphones is helping the sales-people finish 40 to 70 minutes sooner each day than with the previous system. “With the old system, I used to see every single salesperson on a regular basis because they had to come in to upload their orders,” says Maguire. “Now I hardly ever see them because they’re always working in the field.”

In addition, because the orders come in sooner, the warehouse can process those orders sooner and, in some cases, deliver orders the same day.

Quicker Daily Route-Accounting Settlement

Having more accurate orders and accurate pricing information on their Pocket PCs has significantly shortened the checkout process for drivers at the end of the day. “The old Norand device didn’t have pricing, so if drivers needed to change an invoice, they had to know the price,” says Maguire. “When you’ve got 300 SKUs, it’s kind of hard for a driver to know every price. The eoStar system makes it much easier for them.”

The proof of that ease of use shows in the reduction of driver checkout times from an average of 35 minutes with the previous system to 5 minutes with eoStar on the Windows Mobile powered Pocket PCs. The eoStar solution also saves Schenck’s route accountants two hours per day in settling the daily transactions, so they can go home two hours earlier than with the previous system.

Increased Sales Volume Without Increased Overhead The increased reliability of the eoStar solution has virtually eliminated the problem of lost orders. “In the old system, our salespeople would say that they placed an order, and it didn’t go through,” says Maguire. “The eoStar solution has proven so reliable that if an order doesn’t show up in the system, we know it wasn’t submitted.”

Because the eoStar solution running on Windows Mobile powered smartphones provides salespeople with more sales reports and extremely accurate information very quickly, salespeople are able to present better business cases to customers. That increased efficiency may also help to explain how Schenck

was able to increase sales volume by 9.5 percent in 2005 without increasing head count.

Streamlined and More Flexible Reporting With its new eoStar route automation system, Schenck can create any report it needs without requiring vendor intervention. “Now we can create any report that we want,” says Merrill. “We’re able to analyze sales on a per-case-equivalent basis by customer, by day, by invoice, and by many other criteria that we could never use before.” This flexibility makes it easier for Schenck to create reports for both government and supplier organizations.

“Our supplier audits are conducted based on rebate information that we submit, requesting money back,” says Merrill. “Rather than taking a week as it did with the previous system, it only takes about a day to turn around a supplier report with eoStar. Our suppliers are extremely happy with the information that we’re now able to provide them. Often they come to us for information before they ask their own internal people.”

Expanded Capabilities With Reduced Cost Because eoStar is based on the .NET Framework, it can easily be adapted to meet changing business needs, which adds flexibility and reduces maintenance costs. “We don’t have to wait until all of Rutherford’s other customers need a change to get something we need,” says Meckley. “And we can even add our own parts—such as fields or stored procedures—to the eoStar system.”

The eoStar solution also supports more cost-effective hardware. “Because eoStar runs on any Windows Mobile powered device, the customer has a lot of hardware options—from ruggedized devices to consumer-oriented devices—which are available for a fraction of the cost of the old proprietary handheld computers,” says Filips.

As one of the first beverage distributors to implement an eoStar system, Schenck has been a showcase for the solution within the industry. “The difference between this system and what we had before is as different as night and day,” says Merrill. “One of the things that I’ve shared with other wholesalers is that now with eoStar running on Windows Mobile powered smartphones, our business opportunities and objectives are not dictated by what our route automation software can do—they’re enhanced by it.”

Windows MobileWindows Mobile brings the power of the Windows operating system to mobile devices, helping businesses and their mobile employees stay connected while on the go. Windows Mobile runs mobile versions of Microsoft programs, including Microsoft Office Outlook® Mobile, Internet Explorer Mobile, Pocket MSN®, Windows Media® Player Mobile, and Microsoft Office Word Mobile, PowerPoint® Mobile, and Excel Mobile. With Windows Mobile, information workers get powerful software combined with the familiarity of Windows. Combined with available service plans and connectivity options, Windows Mobile–based devices, available from 42 device makers and 68 mobile operators in 48 countries, can be used to make calls, send e-mail and instant messages, surf the Web, and access critical business information even when users are away from the office.

More information about Windows Mobile can be found at: www.microsoft.com/windowsmobile

For More InformationFor more information about Microsoft products and services, call the Microsoft Sales Information Center at (800) 426-9400. In Canada, call the Microsoft Canada Information Centre at (877) 568-2495. Customers who are deaf or hard-of-hearing can reach Microsoft text telephone (TTY/TDD) services at (800) 892-5234 in the United States or (905) 568-9641 in Canada. Outside the 50 United States and Canada, please contact your local Microsoft subsidiary. To access information using the World Wide Web, go to: www.microsoft.com

For more information about Rutherford & Associates products and services, call (800) 270-7558 in the United States or (616) 392-5000 outside the United States, or visit the Web site at: www.eostar.com

For more information about Schenck Company products and services, call (407) 299-4773 or visit the Web site at: www.schenckco.com

© 2006 Microsoft Corporation. All rights reserved. This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY. Microsoft, ActiveSync, Excel, MSN, Outlook, PowerPoint, Windows, the Windows logo, Windows Media, Windows Mobile, and Windows Server are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks are property of their respective owners.

Document published June 2006

Software and Services Windows Mobile 2003 Microsoft Servers

− Microsoft Windows Server 2003 − Microsoft SQL Server 2000

Technologies− ActiveSync− Internet Information Services

(IIS)− Microsoft .NET Framework− Web services

Hardware Compaq ProLiant servers Verizon Audiovox 6600

smartphones Intermec 750 series Pocket PCs

Partners Rutherford & Associates