Vincent Weijers, COO of bol.com:
"Without good product identification, our operations would fall apart."
Every day, thousands of items leave bol.com's warehouses. In the coming months, the number of items could even escalate to one million per day. The importance of correct GTIN numbers [Global Trade Item Numbers] and reliable data cannot be overstated. Without them, the largest webshop in the Benelux would fail to fulfil its delivery promises. According to Vincent Weijers, Chief Operations Officer: “Selling partners who provide accurate codes and data are rewarded with increased transactions and satisfied customers”.
During the year of the coronavirus, bol.com experienced an impressive 54 percent growth in revenue. Even now, as the virus appears to be under control, bol.com continues to grow. "The coronavirus has certainly accelerated our growth. And we continue to make plans for further expansion. Why? Because we see that our proposition aligns very well with the needs of consumers," says Vincent Weijers.
How did you manage to cope with a sudden growth?
We quickly ensured additional capacity by redesigning existing warehouses and leasing new ones. I am proud of my team who achieved this. Our top priority is always to be one hundred percent reliable. If necessary, we adjust the delivery promise to a later time. We prefer to do this rather than taking all orders we can and struggle with fulfilling them later. This approach allows us to keep control over our supply chain. Our customers appreciate this, as they keep coming back to us. They know that their package will arrive at the promised time.
Our top priority is always to be one hundred percent reliable.
How important is data in the process?
Extremely important because transparency is necessary for manageability, and data is essential for transparency. We need to know what product items we are dealing with. What are the requirements that these product items must meet? What kind of treatment do they need? It all begins with a correct barcode: the EAN code, which is officially known as the GS1 GTIN, the Global Trade Item Number. I've been involved with GS1 Netherlands, which was then called EAN Netherlands, since 1993. As an information analyst, I had the opportunity to contribute to the rules for the use of EDI (Electronic Data Interchange). I was immensely proud. From 2012 to 2015, I served on the board of GS1 Netherlands, and I was even chairman for a while. Currently, I am a member of the Global GS1 Management Board. So, from a young age, I have understood the importance of data and standards. Take GS1's slogan, for instance: 'The global language of business.' That is true. Standardisation enables easier communication with many more people. This is also crucial for bol.com. We sell 35 million items across diverse product categories through our platform, and unfortunately, we see that standardisation has not been equally implemented in every product category.
Is there a task for GS1 in this regard?
Certainly, I advocate for more standardisation and more information. In the food sector, GS1 has already launched a data pool to share product data across the supply chain, and we have linked it to a data quality programme. I would like to see similar initiatives in more sectors. With standardised data readily available, we can place more trust in the quality of that data. Currently, this is not always the case. Data quality is particularly crucial in the online realm. The only interaction an online consumer has with a product is based on the information available online. Their purchasing decisions depend on this information being accurate. If the information is incorrect, the product may be returned. In such cases, the customer is dissatisfied, we are dissatisfied, and it has negative implications for the environment.
I advocate for more standardisation and more information.
As many as 52,000 entrepreneurs sell their products through bol.com's platform. Why is it so important for these products to have an identification number?
Having an identification number, a GTIN, for each product allows us to uniquely identify the product throughout the entire supply chain. With the GTIN, we no longer rely on vague product descriptions and can be certain that we are all referring to the same product. During my early days at Unilever, we would receive faxes from customers requesting twelve units of Dove. However, we couldn't determine if they meant twelve bottles, one box of twelve bottles, or twelve boxes, or or two shrink wraps each containing six bottles. No matter how well we describe the products, the GTIN ensures absolute clarity.
What are the consequences if selling partners do not use the GS1 GTIN?
A lot can go wrong. If partners reuse the GTIN from other products, we cannot identify the product correctly, leading to potential mix-ups and confusion. Of course, the risks vary depending on the nature of the products. For instance, if food products are mixed up, it could even result in harm to consumers' health. Therefore, it is also in the best interest of our customers that every partner ensures their products are properly identified. That doesn't seem unreasonable, does it?
Among the selling partner, there are both large companies and small ones, and they all need guidance.
That's exactly what we are striving to achieve. When sellers deal with existing products, they usually don't need to purchase the GTIN from GS1, but we do expect them to use the existing GTIN numbers assigned by manufacturers. However, when sellers sell their own unique products, we encourage them to obtain their GTIN from GS1. We are working to make it easier for smaller sellers by offering smaller subscription plans and code bundles, reducing the barriers to compliance. For instance, does a small family-owned business have to pay for a corporate membership? Why can't that business just purchase a single code?
Selling partners who correctly identify their products with the GTIN get rewarded. They receive better reviews, make more sales, and have fewer returns.
We hear that selling partners who don’t have correct GTIN may be removed from the platform. Does that happen frequently?
Fortunately, not. The majority of sellers do things properly and they are rewarded. They receive better reviews, sell more, and have fewer returns. In certain categories like food, we are extremely strict due to health risks. Thankfully, most of them are aware of this. And we always initiate a conversation first. Actual removals are rare.
Do partners with lower data quality actually perform worse?
We have an algorithm that ranks customers based on attractiveness. Several factors come into play, such as the price and quality of the products, but also the number of issues. If a seller generates more returns than other sellers with the same product, that raises concerns. However, I'd rather look at it the other way around. If you do things right, you are rewarded with more transactions and more satisfied customers.
When you are confident that your foundation is solid and your data is reliable, you can develop logic to streamline your processes.
In media, we hear a lot of stories about returns being discarded.
That is not the case with us. We only discard items that cannot be repaired. We don't mind investing considerable effort in handling returns. It's partly an economic consideration: the amount of labour should be justified by the value added to the product. In the past, we had to open each box to see what was inside. Improved coding and identification of returns now enable us to send them directly to the right specialists without opening them, allowing us more time to enhance the products. This demonstrates that a strong foundation of codes and data drives innovation. When you are confident that your foundation is solid and your data is reliable, you can develop logic to streamline your processes. This logic also helps us provide better recommendations to our customers.
Bol.com aims to enable CO2-neutral shopping. How do you plan to achieve this?
We have reduced carbon emission per package by 34% since 2018 and have recently become a certified B-corp. We aim to achieve carbon-neutral shopping at bol.com and we're working on several fronts to make that a reality. It involves our energy supply, packaging, delivery, and an improved return process to minimise waste. At all our facilities in the Netherlands and Belgium, we use 100% wind and solar energy, partly generated on- or near site. To reduce packaging waste, we have fifteen advanced packing machines and a manual packing system that allows us to customise packaging, minimising the use of excess materials.
In collaboration with carriers like PostNL, we are focused on making our delivery process more sustainable. Already 24% of our "last mile" deliveries are done by bike or on foot. We are working towards achieving zero grams of CO2 emissions per package through further measures such as using smaller, reusable, and biodegradable packages and more efficient and environmentally friendly vehicles.
Furthermore, we are actively pursuing the sustainability of our product assortment. Currently, we offer a sustainable alternative in half of all product categories, and our goal is to expand this to cover all product categories by the following year. We have already removed products like single-use plastics from our assortment. Again, having accurate and comprehensive product data is crucial in this effort. We continue to encourage GS1 to centralise more neutral product data across a wider range of product categories, including sustainability certifications.
We need to be able to rely on correct identification of articles.
The peak season is just around the corner. How did you prepare for it?
The preparation actually started right after the previous peak. It begins with expanding our capacity. To be able to sell a lot in November and December, we started acquiring inventory in September and October. Especially during these months, it's crucial that we can rely on correct identification of products with the GTIN. Otherwise, our operation would fall apart. After all, we're dealing with large quantities, possibly over a million items on certain days. And particularly in December, nothing is more frustrating than a package arriving late.