Customers want fast service when they buy online, regardless of the product they’re shopping for. To deliver in the highly regulated firearms sector, Brownells must keep pace with new requirements.
To balance the demands of regulators and customers, Brownells uses an automated rules engine to rapidly determine if the laws of each customer’s jurisdiction permit the company to process their order.
525%increase in regulated items processed each month thanks to rules-based automation
$20msales boost achieved by increasing monthly order processing capacity
Cutsrisk by helping Brownells maintain compliance in a dynamic regulatory environment
Business challenge story
Aiming high with customers and regulators
The explosive popularity of e-commerce has transformed our shopping habits. Today, consumers expect the ability to browse a wide variety of products online and receive their purchases within a matter of days. To satisfy these rising expectations, many retailers are under pressure to maximize the efficiency of their warehouse management and order fulfillment processes.
Companies operating in highly regulated sectors face an extra challenge: they must meet these rising customer expectations while ensuring compliance with a stringent and constantly changing regulatory environment. For Brownells, a leading online provider of firearms and related products that serves customers all around the world, satisfying a wide range of regulations is an essential part of doing business.
Curt Graff, Director of Technology at Brownells, explains: “The firearms industry is one of the world's most regulated sectors. The rules vary from country to country, and in the USA even from state to state. Our business is very labor-intensive, as we need to check every purchase against the regulations in force in the buyer’s jurisdiction at the time, and keep a full history of actions for regular and random audits.”
As Brownells grew, it wanted to improve its ability to accommodate changing regulations, but making the necessary updates in its legacy ERP system was a complex, costly and time-consuming process.
“To clear the path to growth, we knew that it was time to leave our bespoke ERP system behind, but we didn’t want to abandon all our investments in the platform,” says Curt Graff. “We needed technology that could help us make a low-risk transition, while allowing us to scale up to meet global demand.”
Gearing up for competitive advantage
As a first step, Brownells purchased a new warehouse management system, and deployed IBM Integration Bus and IBM MQ software to connect the application to its legacy ERP platform. Today, IBM MQ transfers messages between Brownells’ warehouse management application and other systems, while IBM Integration Bus reads the messages, orchestrates resources and carries out transformations. The move enabled the company to eliminate around 200 million lines of code, reducing its legacy code base by 30 percent and making it easier to update its system in response to regulatory changes.
“Eventually, we will move to an entirely new ERP system, and the project with Integration Bus and MQ was a key stepping stone in that journey,” comments Curt Graff. “Our investments in the IBM solutions will pay dividends when we move to the new platform, because they enabled us to build a lot of integrations that will be transferable.”
To truly differentiate itself from the competition, Brownells enhanced its fulfillment capabilities with a flexible business rule management system based on IBM Operational Decision Manager software. Every time Brownells gets an order, the rules engine determines whether it should be fulfilled automatically based on policies built into the system. The company places a random selection of “approved” orders on hold as an ongoing audit check. Curt Graff adds: “Our legal compliance team now truly owns the process of adjusting and creating rules in the system; IT is no longer in the middle.”
The company initially deployed the solution on premise, before becoming one of the first to embrace IBM Operational Decision Manager on Cloud. Curt Graff elaborates: “IBM Operational Decision Manager plays an essential role in the capability that sets us apart: specializing in compliance at scale.”
Adam Davenport, Senior .Net Developer at Brownells Inc. comments: “We chose to move to the cloud because we have big business problems with a small business staff. Choosing IBM Operational Decision Manager on Cloud meant we could stop worrying about installations, maintenance, updates and more. It allowed us to ramp up security while reducing complexity because we don’t have to poke holes in our firewall so that ODM can communicate anymore; now we can connect directly to the cloud.”
Triggering multi-million-dollar sales
Supported by IBM solutions, Brownells can provide near real-time feedback to most customers when they place their order, regardless of their location. As a result, the company has dramatically reduced wait times, helping it to enhance the customer experience. Curt Graff explains how this has translated into impact on the company’s bottom line: “Scaling up operations with IBM Operational Decision Manager on Cloud enabled us to surpass our revenue targets of USD 15 million to increase our sales by USD 20 million in a year.”
Brownells has increased its regulated item throughput: the same team can now process up to 500 regulated items per day, whereas before it could only handle 80 per day. This throughput increase of 525 percent means that the company can handle more orders at lower cost, which removes barriers to growth.
Crucially, Brownells is better-equipped to adapt to changing regulations, increasing the company’s agility and offering a valuable edge over competitors. Looking to the future, Brownells has plans to extend its IBM Operational Decision Manager environment.
Adam Davenport concludes: “With IBM Operational Decision Manager on Cloud, we get a full audit trail of every decision we make, giving us the comprehensive accountability we need to be confident that we are compliant. It gives us the flexibility and control needed to accommodate the complex, dynamic global compliance environment more effectively than competitors, so we can grow our market share. Next on the list of solutions to deploy is the Decision Composer, which will give us drag and drop capabilities for building rule models, which will enable us to adapt to new regulations even faster.”
For over 75 years, shooters, professional gunsmiths, hobbyists, military/law enforcement armorers and gun tinkerers have turned to Brownells Inc. for high-quality gun parts and supplies. Via it’s e-commerce site, the company offers 90,000 products including unique firearms, gun parts, accessories, gunsmithing tools, ammunition and other products. Brownells is headquartered in Montezuma, Iowa, and has a second facility in Grinnell, Iowa.