61. beCommerce with Björn Dröschel, Managing Director Product & Technology at fulfillmenttools

Speaker A: Hi, welcome to the Catch the Tornado podcast. In today's bcommerce episode, Marcus Lawrence speaks to Bjorn Dreschel, the product and technology managing director at Fulfillment Tools. Fulfillment Tools is a platform that merges E commerce with their clients, store network supporting processes like order entry, shipping, click and collect returns while offering a perfect omnichannel shopping experience for retail customers. In this conversation, Markus and Bjorn discuss the birth of Fulfillment Tools, the unpredictable reality of setting up a company during the breakout of a global pandemic, creating technology that will be adaptable to increasingly rapid changes in the market, and building flexible tools that can be used and customized by people without developer assistance. Tune in.

Speaker B: Today we're talking about innovation, product development and a spin uh off from a corporate. The Rever Group, who is well known for their tech savviness, has a proven track record of spinning off successful companies like Commerce Tools. Today Bjorn Dreschel is with me who is the managing director of the product and technology of film Fulfillment Tools. Some folks called Fulfillment Tools the little sisters of Commerce Tools. So what is the truth and who's Bjorn? Let's jump in and Bjorn, please introduce yourself.

Speaker C: First of all, um, hello Markus and uh, thank you for having me here. Uh, yes, who am I? Um, I'm Bjorn, uh, one of three managing directors of Fulfillment Tools, um, a spin off of Rewe, uh Digital in Germany. Um, before joining Fulfillment Tools I worked for six years in the Reva ecommerce business where my teams created the fulfillment software for Rewe's EFruit delivery and pickup service. Uh, and regarding your question about the relationship between Commerce Tools and us, uh, without Commerce Tools, uh, we would probably not exist. Commerce uh, Tools was Revis Digadigital's first investment in a tech startup and this investment has paid off in full. Kumas Tools showed Revis that you can earn money with technology unicorn in the commerce sector. Commerce Tools is the big sister that we follow as Fulfillment Tools. Uh, let's hope that Commerce Tools will be proud of us at some point and refer to us when it comes to a unicorn in the fulfillment sector as well.

Speaker B: I'm absolutely for sure that they will and I guess it's um, a um, previous addition for Commerce Tools to have on board. But about your track record Bjorn, um, you started career in the logistics industry and um, I assume that you have a deep industry know how. Ah, now you're working directly on the tech product. And was it helpful uh for you to work in the logistics industry before or do you uh, think that there are might missing Some, uh, capabilities. Uh, what is your perspective from the, from the engineering part?

Speaker C: Uh, I would say yes, um, it was very helpful for both sides for the logistics part and the technology part. Um, on the one hand I was finally in the position to build fulfillment software as I have always wished for my former job as a fulfillment manager. And on the other hand I was able to translate expectations from logistics into technology much better. So, um, building bridges between these two worlds, um, when I look back, I think in the past fulfillment software was more functional and process oriented. Uh, so the user played no real big role and the logistics world was relatively stable. Um, people were more concerned with how to further optimize existing processes and they built large monoliths that could help in this stable circumstances. But yeah, we see in the last 10 years, however, the world has picked up some speed and uh, technological development in particular has accelerated this process even further. And in terms of logistics, uh, this means that you have to adapt more quickly and evolve with it. You have to think about the users who have to go along with this change so that it works smoothly afterwards. So I think, uh, to combine both worlds helps to react on uh, this changing world in these days.

Speaker B: Yeah, nice. Thanks for the explanation here. And um, as I saw it in the first, uh, demo or in my first demo, fulfillment tools, it's really user centric and user oriented. Um, and it's nice to see. So, uh, invite everyone to have a look on it. Maybe we talk a little bit over how it started and how was it growing. So you started fulfillment tools within the river group and how was it going? Was there an internal demand and uh, why there was no solution on the market so that uh, you decided to build something?

Speaker C: Um, yeah, at Rever Digital we were somehow pioneers. Um, it was about E Food and uh, this was still a sector where E commerce had hardly established a foothold yet. So look back six years ago and um, so we really good, uh, and so a really good solution for E Food fulfillment was still missing in the market. Um, at the beginning we faced the question of what challenges we will have to overcome in order to be successful and whether there are solutions on the market that would help us, but which we had to customize. Um, the answer to the question was we don't know. Um, and that we need to start a journey to gain experience. Um, in other words, we needed a solution that could be flexibly adapted to what we learn along the way. Uh, and the solution we believed it's better to create ourselves than that we buy something and then Adapt hurtfully.

Speaker B: Okay, I see. And how you found the product market fit and what was the indication from your side that there is a problem on the market that has to be solved? Was it more by solving a problem for the REBA group itself or was it pushed from external demand?

Speaker C: Yeah. Once again, how it's ever the guilty party is Amazon. Um, uh, they have spoiled us all as customers. We know it all. When we buy online, we buy at Amazon because they do it in a perfect way. Um, yeah. And thus, uh, significantly raised the bar for all retailers. Uh, convenience, convenience, convenience. That were the words of one of my former CDOs, who also coins expectation with the term on time in full and friendly. So otif and uh, the customer decides when, how and how quickly they want to be supplied by us. And we as reze have to deliver. No matter whether it's same day, next day at a certain time, we have to deliver. And uh, regardless of uh, whether the customer wants to get a delivery or orders, uh, goods online but picks them up himself in the store, or whether he wants to buy offline in the traditional way, we have to be ready. So, um, what we saw is uh, the real omnichannel need was addressed by the customers and we as re wanted to deliver in order to further inspire our customers.

Speaker B: Okay, got it. That's super interesting how you proceed that. So if you're spinning off a product team or a product company from a company itself, you have to classic dull team dilemma in my opinion. Meaning, uh, you have to decide which people you want to follow you. Uh, and you have to take care that you're not jeopardizing the agenda of the core business. How did you manage it?

Speaker C: Tough question. And um, it was really hard, uh, two years ago. Um, on the one hand you have to say we exist because we did a really good job at Reva. And so the management had full confidence that we will also manage to offer such a solution to third parties. And yet of course it wasn't possible to take everyone with us to repeat the success outside the Revi universe. So we had to find a compromise, uh, which was to take a few people with us who had the know how and who can help with the setup of fulfillment tools and then to complete the team with, uh, external engineering and business experts. So we ensured that we do not take too many people with us and that we do not risk the river business. Um, looking back now, I think we succeeded very well. The River College, uh, continue to optimize river fulfillment and we are on our Way to provide a true omnichannel fulfillment solution for all industries. Enabling retailers to react flexibly and quickly to new challenges like we did in the uh, river context. Um, we continue to exchange ideas with our colleagues from REWE and uh, I think we benefit both from the others experience and knowledge. Uh, we learn and we are going further.

Speaker B: Nice. So you're securing also for the mother, uh, the REWE group that it's beneficial for both sides. Um, your spin off really good to see. And when it comes to pandemic, because it's in everyone's head actually how the pandemic accelerate your business. Um, as far as as I know the software was and is designed to enable a very fast ramp up which is I guess really beneficial in those days so that you can ramp up the logistic processes on the client side very fast.

Speaker C: Yeah, um, what can I say? It was a curse and a blessing at the same time. Um, I know that sounds stupid because none of us likes Corona and we all hope that we can live normally again someday, but still the pandemic has of course helped to push the omnichannel topic. Um, due to the lockdown, um, the brick and mortar business was completely out of step and retailers didn't uh, know how they can continue to serve their customers and sell the goods which were blocked within the stores. Uh, services such as ship from store, click and collect and so on would have helped them to remain active. Yeah, for us, unfortunately the pandemic came too early. Um, we started with our business on 1st January 2020 and we received our keys to our own office, uh, virtually on time for the first lockdown in Germany. So our solution was not really ready to provide immediate help. Um, today it looks different, so the world looks different. But also our solution is now there and can help also of course we are still evolving. Uh, we could already provide a solution to any retailer within a few days to do omnichannel fulfillment on a great level and that then guide them to continuously optimize experience for customers and employees.

Speaker B: So you're pushing the classical MVP approach also to your clients, right?

Speaker C: Yes, correct.

Speaker B: Okay, nice. Super and funny story with the office so that you receive the keys uh, without having um, the need to have in uh, physical office here. Anyway, let's talk a little bit about the product. So um, what challenges are you actually facing in the product management? In my opinion, the product has always to be viable, usable and feasible. And the overlap is uh, in the end the winning zone which is beneficial for your client. Maybe you can Give us uh, and the audience an introduction to that, how product management on fulfillment tools looks like.

Speaker C: Yeah, first of all I'm a logistics guy and um, logistics in my opinion is very simple. Uh, bringing the ordered goods from A to B, uh, and yet logistics ends up uh, being ultra complex. Especially in the case of uh, omnichannel. Um, just a few examples, um, you no longer fulfill from one location but from a multitude of branches and distribution centers. So the question is how can I distribute my orders in the first time? Um, even if the same brand name is everywhere, each store looks different and you have different fulfillment challenges. So it is space, is it number of floors, uh, and so on and so on. So each brand has its specifics that need to be solved. But uh, to get back to your question about how we do product management, uh, we build on one part on our experience from REWE and work closely with the retailers and their users to see if we can solve their needs as much as possible with the existing software. But together we describe the process as we see fit and use initial designs and click dummies to get feedback from our customers. Uh, we proceed iteratively. Preferably we want to start with a pilot within a few days. So what you said MVPs. Um, so that we can see in the real process where something is still missing and where we need to adjust. Uh, fortunately our platform is modular and we have workarounds for missing data so that we can get started first in a few days. This helps us to quickly create added value and still learn together with our customers.

Speaker B: Okay, that's a good one. And how you do uh, prioritization and how you manage your uh, product requirements. Actually I guess it's hard to build a standard product uh, which is a SaaS product in that case uh, which fits for so many users, uh, on a configurable way. How you deal with that.

Speaker C: What we have solved is uh, the greatest pain already. So with us you can flexibly implement, ship from store, click and collect, click and reserve insta returns, etc.

Speaker B: Etc.

Speaker C: And uh, generate added value for your customers. Um, but however we still have many ideas on our roadmap on how to turn this into an unforgettable shopping experience for the end customer. Um, therefore we are currently taking a two pronged approach. What is fundamentally important for existing customers and what can we do in the short term to also provide them with new capabilities in the future. So here we see ourselves as a partner as well. Uh, uh, our prioritization is visible to our customers and they should be able to participate and uh, where we are heading in the future. Um, the issue of configurability, uh, is very central to this. Um, fulfillment doesn't look the same anywhere, not even at the stores at the same retailer. So what I mentioned before, we are in a process of creating a solution where the retailer himself, without tech support, can configure his fulfillment process. The solution is responsive and the retailer can try new things, uh, in time. Um, in fact we believe we have found a first core product that fits all of our customers regardless of industry and helps them to respond flexibly in any challenge to satisfy their customers.

Speaker B: Okay, that sounds super interesting. Um, if you see actually the tech trends on the market, we are observing all that the composable commerce movement is pushing hard into the market and it learns that uh, the old structure or the old way of building uh, infrastructure in the E commerce is outdated. Um, what does composable commerce mean for you clients and which opportunities and challenges you might see in there?

Speaker C: Um, I would agree. So the time of monoliths is over. Um, too much is changing too fast for a provider to react quickly enough, um, to change the picture. Uh, I think that's why teamwork and expertise are key. Ah, right now. Um, so if I have a perfect command of what I can do, then I'm also in a position to adapt quickly. Um, if I see myself as part of a team where everyone processes different skills perfectly but displays the same ability to constantly change quickly, then uh, I think this becomes a force. That's a good one and that's how I understand composable commerce. Um, many providers work together and everyone is an expert on his field. The only thing we have to do is to define the interfaces between the systems and keep them as simple as possible so we can react flexibly and quickly to new uh, challenges together. Um, therefore in the beginning more coordination between many people is necessary. In the end, however, this gives the customer strength against anything that may come along.

Speaker B: Yeah, I totally agree here. And it helps you to stay flexible in the future. Uh, and uh, definitely react on every market change with strong partners on your side when it comes to those capabilities, uh, which we are serving at least in the composable commerce environment. Um, and we're comparing that to uh, maybe capabilities which a merchant should develop on his side. Um, what would be your point of view? Um, what capabilities uh, should a merchant develop to fulfill the logistics as part of the user journey?

Speaker C: All of it has to do with uh, courage, mindset and technical affinity. Uh, when a retailer Work with us. It's clear that we can't cover everything that's needed for a perfect omnichannel experience. Um, we can do fulfillment and I think we can do it very well. Um, but we see ourselves as a partner and help to look um, at the complete user journey together and uh, bring the relevant providers together. Um, fulfillment is a very important part of a successful user journey. Um, yeah, to describe it, Amazon is not so good because the store is so beautiful. You know, uh, the fulfillment is great and that makes it beneficial. Um, but of course it takes courage because uh, in the future you will work with many providers rather than just one to create the perfect experience. Um, it also requires the right mindset because you are embarking on a journey that hardly any retailer has successfully implemented to date. Uh, you have to approach this task step by step and develop along the way, uh, in the interests of your customers. To do this you have to know your customers and their expectations and they change all the day and all the time. Um, but you also need some people in the company with an uh, affinity for technology who recognize the opportunities of this future, drive it ever inward and help to ensure that the appropriate uh, data is made available or you help us to make them available which individual providers need, uh, for their purposes.

Speaker B: Yeah, I totally agree here. Absolutely. So what is in your point of view crucial in a logistic process for merchants in the future? Explaining maybe also that Amazon example which you mentioned before

Speaker C: at the end in an omnichannel context, um, don't forget the employees, um, especially in omnichannel commerce, um, they play a crucial role in whether omnichannel becomes a positive experience for customers or not. Of course individual steps can be optimized through, for example automation. But in the end it still takes the employees to make the process perfect. Uh, that's why we put the employee at the center of our considerations when we develop our products because um, it's the employee who decides if we are and become successful. Um, for example, intuitive use of our solution reduces the risk of errors and increases fun, simple uh, configurations increases flexibility and creates room for creativity. Um, uh, flexible choices of features and services increase solution possibilities when customers with really special requests are ah, on the doorstep. So if the employee is excited, uh, I'm sure this is also reflected on the customer.

Speaker B: Yeah, thanks for that. I really like that um, mythology because in the end, uh, it status that if you're putting employee centric view, uh, all the revenue which is based on your clients will follow because the employees are successful and Making a good job for your clients in the end. So I totally agree here. Yeah, thanks for that, Bjorn. Uh, and as we are coming, uh, to the end, we're always asking the same question to our guests. And, uh, we would like to know from you, what technology trends do you observe in the industry and how they will affect us? Um, maybe we can elaborate on that.

Speaker C: Sure. Um, my big sister company, Commerce Tools, is one of the founders of Mach and uh, composable architecture and so on. But I think that's a new normal, uh, in our current world. So behind all these concepts stands for me the term flexibility. Um, how do I create the technical base to be able to address new challenges quickly and flexibly? Um, for example, we live machine by making our frontends as flexible as possible so that our users can act flexibly even without our support. Um, and in addition, I think that in the future data will continue to play an important role in further development. And for me, it's all about what you do with the data. Um, what insights do I draw from the data for my own performance and the satisfaction of my customers? How do I optimize my products, processes and, and services on the base of data? AI for me is a buzzword, but far too few have a real idea of what it means for them and where AI can really help them already with simple means and yeah, without much fancy effort.

Speaker B: Cool. Thanks for the answer. So, dear audience, we're coming to the end. If you would like to, uh, learn more about logistics and especially about fulfillment tools, reach out to Bjorn on LinkedIn. And don't forget to subscribe our podcast. Bjorn, thanks for being our guest today. I really appreciate the conversation and see you next time.

Speaker C: Thank you very much. See you.

Speaker B: Bye bye.

Speaker A: Thanks for listening to the Catch the Tornado podcast. Make sure you subscribe us on your favorite podcasting channel.