This fast-growing product seller found everything they need to efficiently manage inventory
FH Packaging is the sort of company you don’t often hear about. They quietly – and profitably – make products that everyone needs, even if not everyone realizes it. Their business is creating packaging that other companies use; primarily bottles, and other kinds of containers as well.
“The bulk of our customers are called co-packers,” explains Cayla Baluyot. “For example, if you own a beard oil company, you’ll go to a co-packer, and they’re the ones who fill your bottles. We sell to the companies who fill those bottles, and we can customise any packaging they like, any shape or size.”
Cayla is the CFO of Wolfgang Enterprises, Inc, which runs FH Packaging as a fully-owned subsidiary. The bulk of their business is business-to-business (B2B), but they also run a direct-to-consumer (D2C) online store. The business started in 2014, and Cayla is proud of the growth they’ve achieved in just over six years, with the team increasing from around five employees to more than 30.
With growth comes challenges. FH Packaging needed to manage the complexities of scaling up, operating in multiple markets, and opening new sales channels, all in an economy rocked by Covid-19. Before Cin7, they used ZarMoney to track inventory. The system was quickly overwhelmed when the pandemic began, as their Ecommerce sales went up and their customers inundated them with pre-orders. Luckily, they soon found a very capable and efficient inventory solution in Cin7.
FH Packaging uses Cin7 primarily for more accurate and efficient inventory management, as well as to integrate and streamline operations. Cayla works mostly in the accounting and sales modules: invoicing orders, checking that orders are being dispatched from the correct location, and syncing data with QuickBooks Online. Financial data and reports can then be sent to management, or prepared for compliance. Wolfgang’s CEO also uses Cin7 to view daily sales and inventory. Cayla says Cin7 has hugely helped streamline both their D2C online store and their warehouse operations.
“Before Cin7, we weren’t able to integrate our online store to the software we were using, so we had to manually enter invoices,” Cayla says.
“The integration between our online store and Cin7 definitely helped by automatically pushing through inventory and invoices to QuickBooks. It’s really improved the online side of the business.”
On the wholesale side of the business, FH Packaging has benefited from the operations features that allow them to perform tasks like adding bin and zone locations for products in their warehouse.
“Those features definitely help our warehouse, because we didn’t have a location feature in our old system,” Cayla says. “Now, the whole workflow process just makes sense. When you create the sales order, you dispatch the locations, and everything goes really smoothly. Instead of trying to hunt for an item, our warehouse crews can just go to that location. It makes it easier for our warehouse crews to know where they’re needed to be.”
Cayla says the implementation of Cin7 was less difficult than they’d anticipated, largely because of the excellent help they received from their Cin7 implementation manager.
“Our Cin7 implementation manager was awesome. She made it really easy for us and really took the time to understand our business.”
However, Cayla also says that her accounting knowledge also really helped, which is why she recommends accountants and CFOs take an active hand in the implementation of a new inventory system.
FH Packaging now has more confidence in the numbers that are showing in their balance sheet for stock. They’re also able to provide more insights to the directors around what parts of the business are doing well.
“The insights report in Cin7 also helps,” Cayla says. “We’re able to see whether we have overstocked or understocked products. And on the accounting side, I really enjoy having accurate data from the cost of goods sold — when you go to the sales order, it tells you your profit, which helps a lot, too.”
She says the biggest win from their Cin7 implementation has been streamlining their operations workflow, making it better and avoiding the losses previously caused by inventory errors.
“Everything is more streamlined, everything is accounted for, and that gives the opportunity for the sales people to be able to sell more, since they have the inventory available, and they see, okay, we actually have this in stock!” Cayla laughs.
When it comes to her own role as CFO, Cayla says that Cin7 has saved her an enormous amount of time and effort, allowing her to get her job done more quickly and efficiently.
“When it comes to efficiency, Cin7 saves a lot of time. For me, as the CFO, it’s saved at least two hours a day. Instead of having to stay over time, or having to push back other tasks, I can get it done quickly in a day,” Cayla says.
“Everything is good. I would say it’s a great investment, definitely.”
We asked Cayla to calculate how much FH Packaging’s Cin7 implementation is saving in their wholesale and Ecommerce business, on top of the hours it saves her each day. All dollar figures are in $USD and reflect average US pay rates.
For Ecommerce, Cin7 saves us at least 4 hours per day because of the integrations of our online store, inventory, and accounting.
This is probably equivalent to half an employee’s salary (approximately $36,000), across a minimum of two people. $18,000 x 2 people = $36,000. I can add in maybe additional $10,000 worth of overtime pay for a total of $46,000. Tasks that saved time were data entry, inventory mapping, and management.
For wholesale, it has helped a great deal in inventory management. It probably saves us at least half the time of picking orders. I’d estimate this to be equivalent to hiring an additional associate (average $36,000).
All together, I estimate we’re saving at least $82,000 per year. I think it’s important to note that besides the money saved, the software has helped make the workflow smoother, which leads to less stress, mistakes, and better work-life balance — no need to work overtime!
After FH Packaging’s successful Cin7 implementation, we asked Cayla what she’d tell other businesses looking to incorporate Cin7. Here’s what she had to say.
I would say that before implementing, businesses should really look hard at their workflow process. Understand exactly what your business needs are, and then set aside time to prepare for the implementation because it does take time to learn.
For us, when we first started our implementation, I think we did a weekly meeting, and I think that lasted for about a month. During that time we practiced on our own, and learned from reading other resources on Cin7, which helped.
I think the bulk of the work is really post-live, because that’s when other people will start using it and then figuring it out. “Hey, can I do this? Can I do that?”
You also need a Cin7 Champion. There should always be one person who has full knowledge of Cin7 and how to protect the data that’s being entered, because Cin7 only works as well as the data you give it. So if your internal data is wrong and you put it in the system, obviously it won’t be accurate. Attention to detail is very important!