We will tell you what the “remote control” business is built on and how artificial intelligence reduced the average monthly stock by 8% in just half a year.
The owner of the company Volodymyr Zubenko started dealing with remote controls back in 1999. In 2008, Pulti.ua acquired its own brand and registered trademark. Now the business has grown to the following scale: offices in 2 cities, warehouses in 3 cities, partnership with international factories, as well as retail and wholesale customers from all over Ukraine, who can get the required remote controls in a matter of days.
How did the need for automation arise?
Volodymyr Zubenko is a supporter of business digitalization, so he is not only actively interested in innovations, but also regularly attends various exhibitions around the globe. One of the latest events was ElectronicAsia HongKong where various electronic innovations were presented, but Volodymyr comments that he was most astonished by a robot in the lobby. It communicated freely with Chinese children, tried to understand their emotions and performed simple tasks.
However, the catalyst for change was quite a dramatic story befalling many Ukrainians. Initially, Volodymyr’s business was located in Donetsk. After the events of 2014, he was considering moving to another city, and, having performed a warehouse inventory, he found more than 25,000 unsold remote controls – all remaining from the era of DVD players. Having converted the unsold stock into the cash equivalent and realized that moving and operating of two new warehouses would require considerable attention, the owner of Pulti.ua decided that the business urgently needs a new accounting system.
First experience of work with an ERP system
The first accounting system to be considered was 1C, the Ukrainian market leader. However, according to Volodymyr himself, they “were just unable to sell it” to him. In other words, the employees of 3 companies never proved that the 1C functionality would fully cover the customer needs.
Later, just in a search engine, Volodymyr came across SMART business and, in particular, Kirill Rudnev, the company’s co-founder. After talking for 1.5 hours, it became clear: Microsoft Navision3 is a perfect solution for warehouses.
Microsoft Navision 2015 was implemented at Pulti.ua. The ERP system covered the following needs:
- warehouse stock management;
- customer relationship management;
- financial and accounting reporting.
Of course, it took several months to customize the system to the needs of a particular customer. After all, this is the only way to get the most out of an ERP system. Currently, Pulti.ua is using the desktop version of Microsoft Navision, although employees have access to the system through the “cloud” from any device anywhere in the world.
Integrations as steps to the digital future
Year after year, Pulti.ua has taken steps towards digital transformation. After the ERP system, a CRM system was introduced, followed by the IP telephony. And the logical conclusion to digitalization was the development of a new website with a private account of a wholesale customer.
SMART business participated in setting up the integration chain so that everything worked as a single ecosystem: applications from the site went to CRM, from there to ERP, after which ERP would transmit information about the stock to the website. As a result, customers can see current product stock online.
How was the ERP system upgraded?
Although the words “artificial intelligence” have been circulating in the business environment for the last 5 years, Ukrainian companies rarely implement the AI algorithms and machine learning in their business processes. The main reason is the lack of understanding of where to start and what kind of benefits these technologies can bring.
The catalyst for making a decision on a deeper acquaintance with artificial intelligence was the annual conference of marketing directors. There, Volodymyr heard about the case of UKLON: using machine learning services, SMART business provided a unique pricing for taxi services, which in the future became the company’s unique selling proposition.
That is why Pulti.ua approached SMART business with an open question: “How can you be useful to me?”
Representatives of the data science department of SMART business set out to solve the main problem of Pulti.ua, which was to optimize stocks. In other words, to learn how to accurately predict how many remote controls should be ordered for the next quarter, so that none of the customers feel shortages, and that the goods stored in the warehouse not turn into frozen assets.
SMART Demand Forecast, an AI-based solution, was introduced in Pulti.ua.
The SMART Demand Forecast solution combined the computing power of the Microsoft Azure platform, intelligent algorithms and machine learning in order to accurately predict the demand for remotes.
As of now, the ability to predict assortment and quantitative changes has been implemented in Pulti.ua. SMART Demand Forecast Algorithms provided the business with the opportunity to:
- reduce sales losses due to lack of goods in stock;
- reduce the amount of stocks with a large loss of margin;
- avoid extra costs due to excess stocks.
As a result, stock replenishment plans were automated and the fastest and highest-quality level of service with minimal stocks was achieved.
Plans for the future
As of September 2019, Volodymyr Zubenko, together with data science experts of SMART business, are trying to adjust the mathematical model to the requirements of the product supplier. The thing is that there is a minimum quantity of goods that can be ordered from abroad at a time. The system must learn to answer 2 main questions: how much to order and with what frequency.
Also, Pulti.ua plans to implement the SMART Next Best Action solution. This solution aims to build personalized customer relationships. With each new customer request, the system accumulates and analyzes data, thus offering the best context, channels and types of communications.
Only part of the SMART Next Best Action functionality has been implemented so far: all customers have been divided into segments, that is, an RFM analysis has been carried out. Each segment expects to receive specialized offers.
Who can comment on the results of cooperation with SMART business better than the business owner himself? Therefore, we quote the CEO and the founder of Pulti.ua, PhD in Economics, Volodymyr Zubenko:
This is how Dmitry Solopov, Business Development Manager of SMART business, comments on the many years of cooperation between the companies:
Here are some thoughts of Natalya Onyshchuk, the co-founder and CEO of SMART business, regarding the practical use of artificial intelligence technologies:
SMART business provides services on development, maintenance and training of the ERP and CRM systems, systems based on predicative analytics and artificial intelligence. For 10 years, the company has been consulting and creating proprietary solutions based on Microsoft products, including Microsoft Dynamics 365, Microsoft Office 365, Microsoft Azure, Microsoft Power BI, as well as Data and AI technologies. SMART business has guided digital transformation in companies of different sizes, across different industries and sectors in more than 60 countries worldwide.
Learn more about