| Nutraceutical News over the Years. |
Sept/Oct 2009
Welcome to the latest issue of Nutraceutical News from IFS. We are delighted to introduce you to another great IFS client – Advanced Bio-Technologies, Inc., a biopharmaceutical company based in Suwanee, Georgia. The Marketing Column addresses the importance of using accurate advertising messages regarding the quality and safety of your product. In the Customer Service Corner, we discuss the importance of maintaining an adequate product inventory. And Nutraceutical testing is the subject of our Industry Update.
For more information about the content found here or about any of our products and services, you can always visit our website, www.ifssolutions.com. To share your feedback about this newsletter, please click here. To unsubscribe, please use the link at the end of this issue.
IN THIS ISSUE:
* Client Profile: Advanced Bio-Technologies, Inc.
* Marketing Tip: Does Your Product Live Up to Your Advertising Claims?
* Customer Service Corner: Insufficient Inventory Can Harm Your Business
* Industry Update: Nutraceutical Testing
* About IFS: For More Information, Contact Us
Client Profile: Advanced Bio-Technologies, Inc.
Advanced Bio-Technologies, Inc.
(ABT) is a biopharmaceutical company that was founded in 1999 on its flagship product Kelo-cote, a 100 percent silicone gel or spray used to help prevent and treat hypertrophic and keloid scars caused by trauma, burns or surgery. Kelo-cote, the first FDA approved silicone scar treatment available in a spray, is sold in more than 25 countries. Additionally, ABT offers a physician-only brand, bioCorneum , which is the only silicone gel which incorporates the silicone technology of Kelo-cote and an SPF of 30.
In 2009, the company purchased Belli Skin Care, a company focused on providing skin care products that address the needs of pregnant and nursing mothers, and their babies. The Belli Skin Care line contains 22 different products, including the best-selling Belli Elasticity Oil which is used to help prevent stretch marks from developing as a mother moves through the later stages of pregnancy and the Acne Clearing Facial Wash, which is safe to use through all stages of pregnancy. All Belli Skin Care products are screened by an in-house physician to exclude ingredients with even remote links to birth defects or other problems with pregnancy.
As the company has continued to grow, management became concerned about its ability to continue providing customers with a high level of service without a significant increase in personnel. So they began to search for a fulfillment provider.
“We had three very distinct attributes we were looking for in a fulfillment partner,” explained Zubin Mesginpoosh, ABT director of commercial operations. “It was imperative to have the ability to scale services based on our growth, the capability to “kit” products as needed and, above all, we were looking for a partner with a passion for delivering the highest quality customer services to our patients and consumers.”
According to Zubin, from the first meeting ABT had with IFS, company representatives knew they had found what they were seeking. “The questions that Keith, Karla and other IFS employees asked showed us that the entire company had one goal in mind – not just to provide unparalleled service to our customers, but to truly serve as an extension of the ABT business,” he said.
“The IFS team really showed a deep interest in our products; and as such, they truly know the product lines as well as full-time ABT employees do – they don’t just take and place orders, they consult with the caller to ensure they have what they need. This has resulted in a significant increase in our consumer business.” Zubin continued, “In the four months since outsourcing our fulfillment to IFS, our consumer business for Kelo-cote is up 42 percent, versus the last four months prior to making the move.”
For more information on Advanced Bio-Technologies, visit www.advancedbiotech.com. To learn more about its products, visit http://www.kelocote.com or www.belliskincare.com.
Marketing Tip
Does Your Product Live Up to Your Advertising Claims?
Excellent Products As the country’s economic woes continue and retail sales results remain in the doldrums, it is important for companies to maintain a vigilant focus on product quality and safety. During economic downturns, not only are consumers more focused on getting the most value to their dollars, consumer advocates are on alert for product misrepresentations and scams that can, at the least be overly costly to consumers and at the worst be harmful to anyone fooled by false claims.
MorePixels
According to the Federal Trade Commission, the following rules apply to advertisers:
* advertising must be truthful and non-deceptive;
* advertisers must have evidence to back up their claims; and
* advertisements cannot be unfair.
An advertisement is deceptive if it contains a statement – or omits information – that:
* is likely to mislead consumers acting reasonably under the circumstances; and
* is “material” – that is, important to a consumer’s decision to buy or use a product.
An advertisement is unfair if:
* it causes or is likely to cause substantial consumer injury which a consumer could not reasonably avoid, and
* it is not outweighed by the benefit to consumers.
As news of recalls and warnings about products containing dangerously high levels of lead and highly flammable materials or tainted pet and baby products have increased, so have instances of consumers checking with customer service representatives before ordering certain items to get reassurance that they are getting products that are safe for their families.
For a product manufacturer or marketer, product quality and safety should always be a top priority. Nothing will cause customers to flee to a competitor faster than to learn that a product they are using is unsafe, or whose quality has been questioned. Beware advertising that carries any hint of deceptive or untrue information. It is a company’s responsibility to prove a claim is true. And, unfortunately, if an investigation ever gets that far, you may lose more than customers – your reputation and that of your product could be destroyed.
Customer Service Corner
Insufficient Inventory Can Harm Your Business
Customer Service CornerAs the holiday shopping season nears, consumers are getting serious about how to spend their gift dollars. And even though many experts believe that holiday spending amounts will be down this year, shoppers will still be buying gifts and expecting to find the items they select in stock. When they place an order on your Web site or through the catalog, will they be told that the item they have chosen is on back order or no longer available?
According to an August report by The National Retail Federation that tracks import levels, volumes are at their lowest since 2002. Imports for October, usually the heaviest month when holiday merchandise arrives, are projected to decline 18.8 percent over last year. Clearly the recession is affecting everyone.
However, IFS customer service professionals note that a major concern reported by online shoppers is learning that an item they are interested in is on backorder. And while everyone realizes that this happens from time to time when demand for an item is higher than anticipated, companies that habitually maintain low inventories on popular items run a serious risk of losing long-time customers, as well as any potential shoppers who hear of long back-order waits and stock shortages.
While inventory represents the largest expense for retailers, “it is also the single most important asset for most small retailers,” according to a column by Ted Hurlbut in Inc. magazine. “If you don’t have it, you can’t sell it.” And if customers can’t get it from you…they’ll find someplace else to make the purchase. This hurts your business now as well as in the future.
Industry Update
Nutraceutical Testing
According to an article in the July/August issue of Nutraceuticals World, by assistant editor Sean Moloughney, the quality of a dietary supplement manufacturer’s product may determine the fate of its business as the FDA gears up to enforce general manufacturing process (GMP) standards on companies with 20 or more employees. The standards, which took effect in June, are accentuated by several high profile cases, such as the spiking of protein with melamine and the peanut butter/salmonella scare that led to massive product recalls.
Testing
Industry experts agree that testing will continue to be an important and ever-present part of the dietary supplement business as consumer demand for safe, quality products and new FDA guidelines have raised the bar for the manufacturing and production of supplements.
Quality assurance requires several levels of testing, according to William Neumann, vice president Quality & Regulatory Affairs, Consumer Product Testing Co., Inc., Fairfield NJ. “Good Nutraceutical companies perform sufficient testing to assure that quality requirements are met at all stages up and down the supply chain,” he said.
On the flip side, Mr. Neumann predicts companies that fail to offer an effective quality assurance program will be pushed out of the market entirely. “Just as we have seen in the pharmaceutical industry, the testing of quality into products will eventually yield to a more proactive 'quality by design’ approach whereby the emphasis shifts to ‘up front’ quality assurance activities such as vendor qualification, supply chain quality management, science-based product development and the validation of critical manufacturing processes.”
According to the information, some industry professionals predict the Nutraceutical industry would undergo a transformation similar to that of generic and over-the-counter (OTC) drug manufacturers in the late 1980s and early ‘90s, when stakeholders saw significant consolidation of market share into a handful of larger companies.
IFS is a world class, full service fulfillment services operation with a track record of success. A woman-owned business, we proudly serve some of the country's most respected corporations. With a special expertise in the fulfillment of nutraceuticals, we can help you run your nutraceuticals business more efficiently and more cost effectively.
July/August 2009
Welcome to the latest issue of Nutraceutical News from IFS. We are delighted to introduce you to another great IFS client – Kimball & Young, Inc., a successful provider of high quality mirrors from Dublin, CA. The Marketing Column stresses the importance of carefully targeting your marketing strategies during tough economic times. In the Customer Service Corner, we discuss the important role satisfied employees play in having satisfied customers. And as the dog days of summer settle in, you will learn more about the importance of having a warehouse facility that guarantees temperature control in the Fulfillment Tip.
For more information about the content found here or about any of our products and services, you can always visit our website, www.ifssolutions.com. To share your feedback about this newsletter, please click here. To unsubscribe, please use the link at the end of this issue.
IN THIS ISSUE:
* Client Profile: Kimball-Young, Inc.
* Marketing Tip: Make Sure You're Using the Right Marketing Strategies
* Customer Service Corner: Satisfied Employees Lead to Satisfied Customers
* Fulfillment: Does Your Warehouse Provide Adequate Temperature Controls for Your Products?
* About IFS: For More Information, Contact Us
Client Profile: Kimball-Young, Inc.
Kimball-Young
Kimball & Young, Inc., of Dublin, CA, has been selling high quality mirrors in North America since the mid-1980s. The company’s products include wall and vanity mirrors, make-up mirrors, and hand and travel mirrors with a range of magnification and a variety of long-lasting finishes. In addition to being available by catalog, on-line and in such retail stores as Bed Bath and Beyond, Kimball & Young products are in demand in high-end hotels like Hilton, Starwood, Ritz-Carlton and Trump Hotels, as well as resort properties in Dubai and Macau.
When dealing with such a varied distribution network, maintaining excellent customer service had always been a hallmark for company President Christy Winter. Until about a year ago, all aspects of the San Francisco Bay area-business were handled in-house, “to make sure that everything was done to our standards,” Christy explained.
In December 2007, Christy did some research about the fulfillment business through a Google Search. She made inquires to about 20 companies to learn more about available services and to find a possible resource to support her company’s sales efforts. In spite of it being the busy holiday season, she soon received a reply from IFS President Keith Milburn.
Within minutes of beginning their conversation, Christy knew that Keith “got it,” she said. “He clearly understood what concerns I would have and explained that IFS had the systems and processes in place to fill all our business needs.”
Not wanting to leave anything to chance, Christy decided to give IFS a try by sending them some of Kimball & Youngs’ most challenging products as a trial. “I figured if they could handle orders for these SKUs, they could handle our other products just fine,” she explained. To her delight, IFS handled the orders, fulfillment and customer service issues beautifully.
Since they started using IFS for all fulfillment services a year ago, Christy says that the company has more than met expectations regarding their level of customer service and accuracy in filling and shipping orders. “The transition to IFS has been as seamless as I could have wanted,” she said.
“Keith and his staff have maintained the same level of attention to detail and service that my staff in California had established for our customers,” she continued. “In fact, we have seen less variance in our inventory and fewer shipping errors than when we were doing the fulfillment ourselves. This has generated strong credibility for IFS among my staff and has made the transition much easier for everyone.”
Keith enjoys working with Kimball & Young, Inc. “We are delighted to have added Kimball & Young’s products to our existing client mix. Their high quality mirrors are very complementary with the other companies we serve and it is a pleasure to work with their team."
For more information on Kimball & Young, Inc., visit www.kimballyoung.com.
Marketing Tip
Make Sure You're Using the Right Marketing Strategies
As the economy continues to lag, companies are maintaining their vigilance on cutting costs and boosting efficiencies to help stabilize profitability during the summer doldrums. And while many economists are pointing to small signs of recovery, concerns around unemployment rates and sluggish retail sales make this a good time to revisit your marketing strategies to make sure that you are spending your resources wisely to get your products in the hands of interested consumers.
4P's of Marketing
Why do customers prefer your product?
Is it for quality, value, novelty or excellent service? Find out why your customers choose to purchase your product over the competition. Then, make sure your marketing and advertising efforts focus on the benefits of your product and why consumers prefer it over competing alternatives.
If you have other products that might be of interest to a certain audience, make it a point to introduce them. Send samples, offer an incentive or free-trial for a certain period of time, or reward customers who offer testimonials and refer business to you.
Where did your customers hear about your product?
Asking your customers this simple question can possibly save you a substantial amount of money on advertising. If you are buying print advertisements in newspapers and magazines while your customers are surfing the internet to find information on the products they are seeking, not only are you missing your target audience, you’re wasting dollars that you could be investing much more wisely to keep active customers and reach new ones. Remember, more and more consumers are relying on social networking sites to get information and referrals on the hottest product trends. Find out how to use this to your advantage.
How does your product compare with the competition?
Take a look at your competition. How does your product compare as far as packaging, price, quality and guarantees? Have you received concerns from customers about any of these issues? Are there changes you can make to update or improve your line? If you haven’t been paying attention, you may be losing your share of the market. Take a good look at your product. Find its best attributes and use your marketing resources to position a compelling message directly to the audience that will benefit most.
As the old adage stresses, it is easier to keep existing customers than to attract new ones. If you use the correct strategies to stay in touch with current customers and make sure they are satisfied with your product, you will reap the benefits of not only keeping them for the long-term but perhaps gaining additional business through referrals.
Customer Service Corner
Satisfied Employees Lead to Satisfied Customers
Customer Service Corner
Much is written today about how to keep customers satisfied with every aspect of your business. Without exception, one of the most effective ways your company can keep and maintain happy customers is to retain employees who are happy with their jobs and care about their working conditions.
If employees are happy with their environment and their relationship with their co-workers and managers, they will incorporate these feelings into everything they do while on-the-job – dealing with your customers, vendors and business partners. And while you may assume that their paycheck is what keeps them loyal to your company, you might be surprised to learn that there are several other factors that keep them satisfied and committed to helping your business thrive.
It’s not unusual for companies to survey their customers to find out how well internal staff are handling all aspects of the business, but by taking the time to get input from employees, you may find out about problems you didn’t know you had that are causing your “stars” to look for greener pastures in the near future.
Does your facility inspire productivity?
By creating a work environment that motivates and energizes your employees, you are investing in a long-term established work force that knows your company’s business and its customers. Satisfied employees are more productive and are interested in creating a successful experience for your customers – to keep them coming back to do business with you. On the flip side, every time you are forced to replace an unhappy employee, it is taking productive time away from you as you struggle to find just the right replacement.
So, what will it take to know if your employees are satisfied? The answer is simple – ask them. Employees who have the opportunity to voice their opinion on key decisions that affect their work environment feel respected and valued. And while money plays a key role in employee satisfaction, it also means a great deal to people to know they are being treated fairly and that their opinions are considered when decisions that affect their working conditions are made.
Once you have obtained feedback from your employees, use it! Even if you aren’t able to complete all of the requests the responses uncover, it is imperative to report the results to employees. You will have gotten input on areas that your staff identifies as needing attention and even if you don’t agree, you need to address their concerns. No matter how well the idea of a survey is accepted by your staff, if you don’t follow-up on the responses, the document is of little value to your organization and could actually do more harm than good.
In an industry where customer satisfaction is paramount to success, it is vital to maintain a happy workforce that reflects the culture of your company to your existing and potential customers.
Fulfillment Tip
Does Your Warehouse Provide Adequate Temperature Controls for Your Products?
Warehouse
As temperatures across the country soar this summer, manufacturers of temperature-sensitive Nutraceutical and Cosmeceutical products need to make sure that their warehouse facilities provide the proper temperature and humidity ranges to avoid product degradation between the time the merchandise is stored and when it is mailed to customers.
Even in parts of the country where summer conditions seem relatively mild for the most part, an unexpected heat wave, high humidity or a prolonged power outage can affect product quality; especially when warehouse space is not climate controlled to maintain temperatures between 60 and 77 degrees, the range agreed upon by manufacturers to be safe for these products.
“At IFS, we understand the unique storage requirements for Nutraceutical and Cosmeceutical products,” said President Keith Milburn. “Our warehouse is climate controlled with an on-site monitor that advises us of the temperature and humidity ranges.”
In addition, a back-up generator on the premises ensures constant conditions should a power outage occur at anytime. “While warehouses in moderate temperature locations assume that they will be able to maintain safe conditions for sensitive products, we can guarantee that our warehouse will maintain the ranges specified by the industry to ensure products retain their quality while waiting to be shipped to their final destinations,” Milburn concluded.
IFS is a world class, full service fulfillment services operation with a track record of success. A woman-owned business, we proudly serve some of the country's most respected corporations. With a special expertise in the fulfillment of nutraceuticals, we can help you run your nutraceuticals business more efficiently and more cost effectively.
May/June 2009
Welcome to the latest issue of Nutraceutical News from IFS. As economic challenges continue and consumer spending remains stagnant, we are taking a look at some strategies that can help your business maintain stability for the short-term and keep you ahead of your competition in good times as well as bad.
The Industry Update provides an overview of a recent study by the FDA regarding the oversight of dietary supplements. The Marketing Column reinforces that in a down economy, consumers are looking for value in the products they purchase. In the Customer Service Corner, we discuss how in today’s age of electronic communications, failing to deal with customer complaints in a timely, effective manner can cause extensive damage to your company’s reputation. This issue’s Fulfillment Tip offers advice on how outsourcing some or all of your fulfillment responsibilities can benefit your business.
For more information about the content found here or about any of our products and services, you can always visit our website, www.ifssolutions.com.
IN THIS ISSUE:
* Industry Update: FDA Guidance on Dietary Supplements
* Marketing Column: Value Reigns in a Tough Economy
* Customer Service Corner: The Upside of Customer Complaints
* Fulfillment Tip: In-house vs. Outsourced...Which is Best for Your Business?
* About IFS: For More Information, Contact Us
Industry Update
FDA Guidance on Dietary Supplements
Suppliment Label
According to an article in the April edition of Nutraceuticals World, the Government Accountability Office (GAO) released a report in late January discussing the need for increased oversight and consumer understanding regarding dietary supplements. Emphasizing the need for improvements in how the FDA monitors and regulates dietary supplements, the report also acknowledged that some progress has been made in terms of protecting the public from unsafe products.
In response, the Council for Responsible Nutrition (CRN) sees the report card as an indication that the industry has come a long way since the original 2000 GAO report on dietary supplements was released. CRN President Steve Mister stated that the Council is gratified that this latest report recognizes that dietary supplements are extensively regulated by the FDA and pointed out that the report refers to several of the regulatory improvements instituted – and fought for by responsible industry members – including the issuance by the FDA of good manufacturing practices (GMPs) specific to dietary supplements and passage of a law mandating that serious adverse events are reported to the FDA.
Mister added that he also welcomes guidance from the FDA on New Dietary Ingredients (NDIs) and could potentially support registration of products assuming the details are not inappropriately burdensome and would not prevent beneficial products from being brought to market. He warned, however, that regulations are only as strong as enforcement, and it is time for the FDA to focus its energy and resources on inspections and enforcement actions directed at the small minority of companies that are giving those in the majority a black eye.
Marketing Column
Value Reigns in a Tough Economy
If you’re concerned that current economic conditions may be pushing consumers toward lower prices as the main indicator of product loyalty, a survey recently conducted by BrandKeys, a consulting firm that maintains a Customer Loyalty Engagement Index, suggests that consumers are looking for much more than cost when deciding on where to spend their dollars.
According to survey results, brand value means much more than brand pricing as consumers look for products that will give them good all around value – as opposed to just lower prices or steep discounts. In fact, consumer expectations regarding brand value increased 20 percent over last year’s survey. This was the ninth year of the survey that includes responses from more than 60,000 consumers.
Some examples of category winners: Allstate Insurance, which positions itself as the trusted rather than the cheapest; Sam Adams, the most expensive beer included in the survey, beat Budweiser, the cheapest and W Hotels exceeded brands that offer lodging for 50 percent less – signaling that prices have been neutralized by expectations of value, trust and brand differentiation.
And while companies that have built their brand on value pricing should continue that approach – McDonald’s still won the fast food category – higher-end brands should focus on building trust and value and leave the freebies to other brands.
What does this mean for your brand? If consumers perceive your brand to be a good value, does the product do what you say it will? Does it meet their need? Do you provide consistent, dependable service? Are orders delivered quickly and correctly? Are you willing and able to solve problems quickly and professionally? Do you respond quickly to customer complaints and questions? Are you paying attention to your customers’ feedback and providing new products and solutions to meet their needs?
If you can answer “yes” to these questions, you shouldn’t have to succumb to offering deep discounts to be perceived as having the real value that consumers want and seek, especially in difficult economic times.
Customer Service Corner
The Upside of Customer Complaints
Let’s face it, no one wants to deal with a customer who is calling or e-mailing to complain about some aspect of your product or service. But did you ever consider that a customer who takes the time to let you know that something about your business isn’t satisfactory could actually be doing you a huge favor?
In today’s world of instant gratification and fast-speed communication, anyone who is Web savvy can do tremendous harm to a business by simply passing along his or her negative sentiments over the Internet to friends, family members, acquaintances, co-workers and people they may have never met simply by mentioning their problem on a “blog.”
If you’re not familiar with the term blog, according to Wikipedia, a blog – which is derived from the term Web log – is a type of Web site, usually maintained by an individual with regular entries of commentary, descriptions of events, or other material such as graphics or video.
Customer Service
Many blogs provide commentary or news on a particular subject; others function more as personal online diaries – and for many bloggers this includes posting their frustrations when they believe they have received poor service from a business or have purchased an item that does not meet their expectations.
Just how big is the “blogosphere” – the collective community of all blogs? According to Technorati, an Internet search engine for searching blogs, as of June 2008, there were 112.8 million blogs and more than 250 million pieces of tagged social media.
What does this mean for customer service in the age of online communications?
Complaints posted online can affect shopping and buying decisions, based on the experience of as few as one disgruntled customer. And as this network has grown, it has gotten the attention of some major global brands.
Companies like Comcast, Southwest Airlines and others have started monitoring public comments on blogs, message boards and social networks for any negative mention of their names. They realize how quickly these messages are traveling around social media sites and understand how damaging the complaints can be to their business. When they encounter a complaint they contact the source to try to solve the problem.
And while not every company has the resources for a blog monitor, it is important to realize that their customers are talking…and not just in the retail store. The exposure of a customer service problem is far more reaching in today’s technology age. So make sure that when a customer calls with a complaint, your customer service representatives do what it takes to solve the problem quickly to keep your customer happy. As a result, when this particular customer is blogging, tweeting or simply emailing a friend, the only words used to describe your company will be that…You took great care to provide excellent service.
Fulfillment Tip
In-house vs. Outsourced...Which is Best for Your Business?
Fulfillment
In today’s competitive marketplace, having a terrific product line and clever marketing strategy will only get you so far if your goods aren’t reaching your customers in a timely and accurate manner. With all the available options, customers will be quick to jump ship to another vendor if your “back-end” operations aren’t robust enough to handle all aspects of fulfillment. That includes product storage, packaging, shipping and delivery, as well as credit card processing, inventory management, customer service, and merchandise returns and exchanges.
If handling many aspects of fulfillment internally is taking away the time you should spend on the day-to-day management of your business, product sales and marketing, and business development, perhaps you should consider outsourcing some or all of your fulfillment responsibilities.
Consider how your time could be spent if you weren’t involved in the following tasks:
Order Processing
Credit Card Processing and Calling on Bad Numbers
Pick, Pack and Shipping
Inventory Replenishment
Customer Service Issues
Warehouse Management
Packaging Material Sourcing
Managing Workers Compensation Issues
Sourcing and Maintaining Material Handling Equipment
And, ask yourself these questions:
* Do you really want to staff a Call Center? (What is the proper number of staff?)
* Do you have the capabilities to capture and manage your customer database?
* Are you prepared to monitor your Web site or e-mail every few hours?
* Are you equipped to react quickly to customer surveys regarding business/product improvement?
* Do you have seasonality issues to consider?
* Do you have the capabilities to package and ship properly?
* Do you have inventory management systems in place?
Weigh the benefits and the costs
Before you decide to outsource any portion of your business, you need to weigh both the benefits and the costs of handling all your operations and customer service internally, and then review those same benefits and costs if you outsourced them to a professional fulfillment firm. In today’s difficult economy, fixed costs can negatively impact one’s business if your sales are declining and cash is at a premium. Turning fixed costs into variable costs can save cash as you pay only based on the number of orders you ship.
If you think outsourcing might be right for your business or want to know more about the costs and benefits, check out the White Paper by Keith Milburn, president of Innovative Fulfillment Solutions (IFS), entitled Outsourcing Fulfillment: Putting Back-End Issues Out Front at www.IFSSolutions.com.
IFS is a world class, full-service fulfillment services operation with a track record of success. A woman-owned business, we proudly serve some of the country’s most respected corporations. With a special expertise in the fulfillment of nutraceuticals and cosmeceuticals, we can help you run your business more efficiently and more cost effectively. We appreciate your comments and welcome the opportunity to discuss your particular needs.