Case Study – Chalmers Organics
Steven and Elizabeth Chalmers turned their passion for healthy lifestyles into a multi-generational family business.
They started out in retail in the 1970s, selling organic and sustainably-produced foods from an Auckland shop that over time became an institution to their customers. Only one ingredient was missing.
“There just weren’t any organic soy products in the country,” says Jesse Chalmers, a second-generation owner and director of Chalmers Organics. “My parents asked a competitor to make it for them, but he wasn’t interested, so they started making it in the back of their shop. It kind of grew from there as customers started demanding it more.”
Chalmers Organics years later came out with TONZU, a brand of packaged certified organic tofu, tempeh, yogurt and vegetarian meat substitutes. TONZU today is found in health food stores, supermarkets, cafes and restaurants around New Zealand, with a growing market in Australia.
Organic Growth, Complicated Supply Chain
“I don’t think I’ve come across anyone that has such a complex supply chain,” Jesse says of TONZU.
On one end, there’s the creation of products with various ingredients to be sold and packaged in single retail units. To the other end, TONZU sells to more than 500 customers (30% direct, 70% through distributors) including national supermarket chains buying from more than one location. One of these chains buys through a distributor in one part of New Zealand, but purchases directly in another.
Meanwhile, other customers sell on commission or on consignment, making it vital for Chalmers to track TONZU products to the sale.
“It was a mixed bag trying to monitor our direct sales and the commissions and having different freight carriers,” Jesse says. “We have a very, very complicated set-up. It’s a bit hodgepodge but somehow it works, now that we can keep track of it all.”
Clarity through Cin7
As the TONZU brand grew, Chalmers Organics found it difficult to use its old inventory system of Excel spreadsheets and an MYOB account. It took too much time to manually process purchase orders, data entry errors complicated things.
“It impacted our sales because we couldn’t be 100% sure of what we were achieving in certain areas, and we couldn’t figure out our potential growth properly,” Jesse says. “There wasn’t an option to have our accounting and our stock management aligned, and MYOB is not capable of the complexity involved in our level of manufacturing.”
They started using Cin7 in December, 2015.
“We actually could track sales, so that was a big change with Cin7,” Jesse says. “We’d struggled because of the way billing was set up with supermarkets, where we couldn’t track individual branch sales with 100% accuracy. Cin7 lets you track everything, really, which can then be separated out and reported on. That was a massive thing for us for hitting our targets.”
Jesse says automation saved the company a lot of time. Invoices were now processed five times faster than under the older manual system. Cin7’s reporting system also cut the time it once took mining data from spreadsheets.