Sport Supply Group Relies on SAP to Keep Running
The Sport Supply Group’s e-commerce operation has enough bells and whistles to require an exceptionally robust software platform. Founded in 1972 as a catalog-based business, SSG now runs both a B2B site and a direct-to-consumer site, each of which offers logistical challenges.
On the B2B site, SSG sells sporting goods to all manners of institutions, from the YMCA to schools to the U.S. government. The site’s software must allow sophisticated customized bidding options to its institutional buyers.
On its direct-to-consumer site, esportsonline – the fastest growing part of its business – SSG sells everything from sports medicine to lacrosse trophies. To supply both sides of its business, the company must manage inventory flow from three sources: SSG manufactures some of its goods, it buys some wholesale, and it sells some on a drop-ship basis.
To build a platform to handle this data flow, Texas-based SSG used SAP software.
“In 1999, when everyone was facing the Y2K scare, we decided we had an antiquated computer system,” says Paul Kruger, SSG’s director of Internet operations. “We really needed an enterprise resource planning (ERP) package to run our business from soup to nuts.”
The company decided to implement SAP software to run its entire business, including its e-commerce operation.
“At that time, we surveyed our customers and asked what things were most important to them, and we came up with a requirements list,” he says. SSG’s custom-built SAP e-commerce engine was then designed with its customer requirements in mind.
Customized Pricing
“We do a lot of customer specific pricing,” Kruger notes. When a given institutional buyer logs in, she sees prices that are customized based on her company’s specific contract.
The SAP software scales this customized pricing based on quantity – one price for buying 500 units, a lower price for 1,000 units. Prices are scaled for each of SSG’s 12,000 SKUs, so a massive amount of competitive bidding goes on without needing a salesperson on the phone.
The software “will spin through and say, ‘does this product exist on the bid as a hard price, or, if not, apply a ten percent discount,'” Kruger says.
Adding still more complexity, “School A and school B might be down the street from one another, but have an extremely different bid price for the very same item, due to level of competition or region – we have all this bid intelligence.”
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| The Sport Supply Group’s acters to both business customers and consumers. |
Migrating Customers
The SAP software tracks inventory, constantly updating the site to display number of units in stock. It performs a secondary inventory check when the customer purchases, and if there’s a problem it offers a replacement item.
This cross-selling also works to increase sales: once an item is placed in a cart, SSG’s platform offers related items to the customer. If, for example, a customer buys a pitching machine, they might be offered a ball carrier.
Kruger’s only minor quibble about the SAP software: “if you can imagine, SAP has to spin through all these pricing records, that’s quite a load, so sometimes our site speed can be questionable,” he says. However, “that’s one of the only things I’d be interested in reworking.”
Since going live in 2000, the site has changed the way SSG does business.
“We’ve gone from no sales on the Internet to having 50 percent of our orders coming through the Web,” Kruger says.
| Name: | Sport Supply Group, Inc. |
| Founded: | 1972 |
| Sales/revenues: | $80 Million annually |
| Content management/storefront system: | SAP |
| Database backend: | SAP |
| Visitor analytics system: | SAP |
| Affiliate technology provider: | In-house |
| Payment solutions provider: | Paymentech for credit cards |
| Hosting provider: | In-house |
| Number of tech staff: | 69 MIS, 4 Internet |
| Number of employees: | 230 |
| Key strategies: | • Carefully managing inventory from three different sources. • Use real-time, customer specific pricing and bidding. • Using cross-selling techniques to boost sales. |
James Maguire is a contributor to eCommerce-Guide.com. His column appears every Friday.
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