Evolving beauty.

by Nick Bailey.

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Solution Architect Nick Bailey talks of his experience helping our growing Health, Beauty & Wellness Industry.

If you’d asked me about New Zealand’s health, beauty and wellness industry a year ago there’s not much I could have told you.

Today I can tell you that this industry is booming! It's another great Kiwi export story that we can all be proud of. Luckily, we can get most of these products onshore here too. 

I have worked on several projects in this industry recently, for four great brands: 

  1. Trilogy - makers of the world-famous Rosehip Oil, as used by the Duchess of Cambridge. 
  2. Shieling Laboratories - a contract cosmetics manufacturer for multiple companies. 
  3. Pure Ingredients - importers and distributors of bulk cosmetic, personal care and natural health ingredients. 
  4. And most recently, Xtend-Life – manufacturers of natural supplements, skincare and superfoods.

(When you look at this list and our other customers it’s fair to say that we have the deepest health, beauty and wellness industry experience in New Zealand, but that’s a story for another time! 😊) 

Across all these projects there were similar pain points across the industry:   

  • Capital tied in inventory 
  • Double handling of orders and paperwork 
  • Lack of live insights or integrated reporting 
  • Extensive time spent tracking batches 
  • Mis-picks due to hard to identify products for warehouse staff 
  • Relying on an application sprawl of disparate applications and spreadsheets. (If that's you this may be useful)

Most of these challenges were also evident in my most recent project for Xtend-Life. I was the lead consultant on the project, responsible for the successful implementation and ensuring the project delivered the expected value.  

When I first met Xtend-Life they had an in-built custom solution called XOPS - Xtend-Life Order Processing System. This solution had grown from an order processing system to a lite-ERP which had been completely built in-house. Although the system was a lite-ERP it did not manage across the entire organisation, only specific areas.  

This was a highly customised, undocumented system with a low bus factor (not prepared for the 'hit by a bus' scenario). Changes to the system and new enhancements were time-consuming and the reliance on individuals exposed Xtend-Life to risk - this is a trend I am continuing to see across several other projects.  

Let’s take a walk through this project: 

The pains  

Like all companies in this industry, Xtend-Life’s ability to track products to a granular level is critical. When we first met, the time spent recording which batch of raw materials went into each product, and where those specific products ended up worldwide was significant. 

If there ever was a recall, paper-based records would make this process slow and difficult. 

In extreme circumstances, paper-based records also made them vulnerable to natural disasters and fires. Based in Christchurch, they experienced the devastating earthquakes of 2010 and 2011 and knew they needed a better system, but handling BAU on the old system meant no time to investigate options.  

Another major pain point for the business was the double-handling of paperwork and transactions.  

Xtend-Life had software for processing orders but were also using spreadsheets for managing manufacturing and inventory. A lack of system integration and no single source of data was a real challenge as it meant the business didn’t have live insight into where a product was in the manufacturing process at any given time, without talking to the Production Manager. 

Inventory was also managed on spreadsheets, so forecasting and procurement was difficult without getting under the hood of some very complicated formulas. It’s amazing how many businesses I come across that do not have real time insights or visibility into their own operations. 

The pill - NetSuite to the rescue 

We replaced all of Xtend-Life’s old systems with NetSuite over two phases.  

Phase one delivered three critical business processes: 

  • Record to Report - Accounting, Banking and Payroll 
  • Design to Build - Inventory, Warehouse and Manufacturing 
  • Procure to Pay - Procurement and Purchasing 

For phase two, we integrated an additional two business processes: 

  • Order to Cash - Customer Management, Order, Fulfilment, Payments and Billing 
  • Call to Resolution - Customer Care and Support 

As part of phase two we integrated NetSuite with their Shopify website using the Celigo Shopify-NetSuite SmartConnector. The majority of their sales are online, so this phase needed to be seamless.

All website orders now come directly into NetSuite in real-time. All customer support is tracked and logged in NetSuite to give the full omnichannel experience for Xtend-Life customers. 

The proof 

The feedback from Xtend-Life has been great. In phase two they went live simultaneously with all company websites. They were understandably nervous, but it went smoothly with no significant issues occurring throughout the deployment and cut-over phase. 

It was BAU the very next day with no need to halt order processing or shut-down the business for a period of cut-over.  

During this phase, all of their historical and existing customer records and sales orders were also migrated into NetSuite.  

Since then, we’ve also supported them in connecting their Amazon webstore to NetSuite. That’s something that they mostly did in-house, with little assistance from our team.  

Manufacturing and stock levels 

With the arrival of NetSuite, Xtend-Life can now manufacture to meet demand based on real-time visibility of stock levels. It’s much more efficient and has tightened up operations which directly (and positively) impacts the bottom line.  

NetSuite has helped Xtend-Life improve their manufacturing processes and inventory pricing. Previously they would price their products based on the cost of the ingredients that went into them, as well as an estimate for labour and machine time. 

In NetSuite, Xtend-Life can now record actual manufacturing time against every single process that they complete (including set-up and clean-down of machines) and see how much it costs them. This new visibility enables them to not only understand the true cost of each product but to make more efficient scheduling decisions. There’s no wastage due to approaching expiry dates. And of course, cashflow is improved by not carrying unneeded stock.

Using a fully integrated system for Demand Planning and Manufacturing allows Xtend-Life to plan future Work Orders and see the impact of inventory.   

Get loyal 

Xtend-Life have also built and enhanced their existing loyalty programme into NetSuite. The Xtend-Life Club entitles members to a 10% standard discount, and NetSuite has been configured to offer options for customers to either choose automatically recurring orders, or respond to a monthly reminder to purchase favourite products. With Xtend-Life’s customer information all kept in NetSuite, generating reports on customers and the products they love is simple and fast. Another win! 

Future trends 

The health, beauty and wellness industry is currently booming, and NetSuite is a great platform to support this growth. As people become more and more conscious of their health, they try more products and solutions to cope with modern lifestyles. 

In the era of AI and Machine learning most people are very cautious, but when it comes our health, we expect our favourite products, brands and companies to know what we need. I believe that every health, beauty and wellness business, across the entire spectrum from cosmetics to nutrients and supplements, to food delivery or beauty-on-demand services, will need to embrace cloud-based ERPs to stay financially efficient and meet the needs of customers in the rapidly evolving digital world. 

Without adopting a cloud-based ERP that can keep up with the pace of this industry I fear companies could fall behind. You can read more about the capabilities of NetSuite for companies in the health, beauty and wellness sector here.

About Nick Bailey 

I’m a Solution Architect working for Fusion5 within the NetSuite Team. I provide expertise to prospective and existing NetSuite customers to help them realise the full potential of their NetSuite journey. I design solutions to address requested business needs, while seeking out other ways to improve business processes. 

I get to see every project from beginning to the end, and from the inside out. Having the opportunity to work with customers in this industry is great, the people and their experience has benefited me hugely, so I want to thank all my customers for what their projects have taught me. 

More than skin deep

Simplifying technology for the Health, Beauty & Wellness Industry

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