Markus Lorenz 0:47
Today, we're talking about innovation, product development and a spinoff from a corporate. The Rewe group, who is well known for their tech savviness has a proven track record of spinning off successful companies like commercetools. Today, Björn Dröschel is with me, who is the Managing Director of the Product and Technology at fulfillmenttools, some folks called fulfillmenttools, the little sisters of commercetools. So what is the truth and who is Björn? Let's jump in. Please introduce yourself.
Björn Dröschel 1:22
First of all, hello, Marcus! And thank you for having me here.
Yes, who am I. I’m Björn, one of three managing directors of fulfillment tools, a spinoff of Rewe digital in Germany before joining fulfillmenttools, I worked for six years in the Rewe digital ecommerce business where my teams created the fulfillment software for Rewe’s delivery and pickup service. And regarding your question about the relationship between commercetools and us: without commercetools we would probably not exist. Commercetools was Rewe digital’s first investment in a tech startup, and this investment has paid off in full. Commercetools showed Rewe that you can earn money with technology. Let's hope that commercetools will be proud of us at some point and refer to us when it comes to a Unicorn and the fulfillment sectors.
I'm absolutely sure that they will. And I guess it's a brilliant addition for commerce tools to have you on board. But about your track record. You started your career in the logistic industry. And I assume that you have a deep industry know how now you're working directly on the tech product. And was it helpful for you to work in the logistic industry before? Or do you say I think that there are some missing capabilities? What is your perspective from the engineering hearing part?
Björn Dröschel 2:57
I would say yes, it was very helpful for both sides for the logistics part and the technology part.
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 building bridges between these two worlds. When I look back, I think in the past fulfillment software was more functional and process oriented. So the user played no real big role and the logistics word was relatively stable. People were more concerned with how to further optimize existing processes and they built large monoliths that could help in these stable circumstances. But we see in the last 10 years, however, the word has picked up some speech and technological development in particular, has accelerated the previous process even further. And in terms of logistics, this means that you have to adapt more quickly and evolve with it. You have to think about users who have to go along with this change so that it works smoothly afterwards. So I think to combine both worlds we have to react to this changing world these days.
Markus Lorenz 4:29
Yeah, nice. Thanks for the explanation here. And as I saw it in the first demo, or in my first demo fulfillment tools, it's really user centric and user oriented. And it's nice to see so I invite everyone to have a look at it. Maybe we talk a little bit about it, how it started and how it was growing. So you started fulfillment tools within the Rewe group. And how was it going? Was there an internal demand and why there was no solution on the market so that you decided to build something.
Björn Dröschel 5:04
You're at Rewe digital, we were somehow pioneers. It was about E food. And this was still a sector where e commerce had hardly established a foothold yet. So I look back to six years ago. And so we are really good. And so a really good solution for efood fulfillment was still missing in the market. 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?
The answer to the question was, we don't know. And that we need to start a journey to gain experience. In other words, we needed a solution that could be flexibly adapted to what we learn along the way. As a solution, we believe it's better to create ourselves than to buy something and then adapt heartfully.
Okay, I see 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 about solving a problem for the rebel group itself? Or was it pushed from external demand?
Yeah, once again, however, the guilty party is Amazon. They have significantly raised the bar for all retailers. Convenience, convenience, convenience. That was that word, the words of one of my former CDO’s who also coins expectation with the term on time, in full, and frankly, so “OTIF”. And the customer decides when and how quickly they want to be supplied by us. And we as retailers have to deliver no matter what, whether it's the same day, next day at a certain time, we have to deliver. And regardless of whether the customer wants to get a delivery, or orders 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 what we saw is the real omni channel need was addressed by the customers and we at Rewe wanted to deliver in order to further inspire our customers.
Okay, got it. That's super interesting. And how you proceed. So if you're spinning off a product team, or a product company from a company itself, you have the classic intel team dilemma, in my opinion, meaning you have to decide which people you want to follow you. And you have to take care of that you're not jeopardizing the agenda of the core business. How How did you manage it?
Björn Dröschel 8:05
Tough question. And it was really hard two years ago.
On the one hand, you have to say we exist because we did a really good job at Rewe. 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 of the Rewe universe. So we had to find a compromise, which was to take a few people with us who have the know-how, and who can help with the setup or fulfillment tools and then to complete the team with our 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 Rewe business. Yeah, looking back now, I think we succeeded very well. So Rewe college continues to optimize Rewe fulfillment. And we are on our way to provide a true omni-channel fulfillment solution for all industries, enabling retailers to react flexibly and quickly to new challenges like we did in the river context. We continue to exchange ideas with our colleagues from Rewe and I think we benefit both from the others' experience and knowledge, yeah we learn and we are going further.
Markus Lorenz 9:34
Nice, so you're securing also for the mother group, so that it's beneficial for both sides, your spin off. When it comes to pandemic because it's an everyone's head actually, how did the pandemic accelerate your business. As far 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 logistic processes on the client side very fast.
Björn Dröschel 10:04
BF, what can I say it was a curse and a blessing at the same time. 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 had highs, of course had to proceed omni channel topic. Due to the lockdown, the brick and mortar business was completely out of step. And retailers didn't know how they could continue to serve their customers and sell the goods which were blocked within the stores. Services such as ship from store, click and collect and so on would have helped them to remain active. And yeah, for us, unfortunately, the pandemic came too early. We started with our business on the first of January 2020. Yeah, and we received our keys to our own office virtually on time for the first time in Germany. So our solution was not really ready to provide immediate help. 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. We could already provide a solution to any retailer within a few days to do omni channel fulfillment on a great level. And that guy then guide them to continuously optimize experience for customers and employees.
Markus Lorenz 11:34
So you're pushing the classical MVP approach also to your clients, right? Okay, nice, super and funny story with the offers so that you received the keys without having the need to have an upset or in a physical office here. Anyway, let's talk a little bit about the product. So what challenges are you actually facing and the product management, and in my opinion, the product has always to be viable, usable and feasible. And the overlap is in the anti winning zone, which is beneficial for your client? Maybe you can give us and the audience an introduction to what product management on fulfillment tools looks like.
Björn Dröschel 12:17
You're first of all, I'm a logistics guy. And logistics, in my opinion, are very simple. Yeah, bringing the ordered goods from A to B. And yet logistics ends up being ultra complex, especially in the case of omnichannels. Just a few examples. 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? And the first time? Yeah, even if it's the same brand name everywhere, each store looks different. And you have different fulfillment challenges. So it is space, is it a number of floors, and so on, and so on. So each brand has its specifics that need to be solved. But to get back to your question about how we do product management. Yeah, we build on one pie on one part on our experience from Reva and worked closely with retailers and the 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. We proceed here iteratively. Preferably, we want to start with a pilot within a few days. So what you said and VPs so that we can see in the real process where something is still missing and where we need to adjust for Fortunately, our platform is modular, and we have a workaround for missing data so that we can get started first and a few days as this helps us to quickly create added value and still learn together with our customers.
Markus Lorenz 14:12
Okay, that's a good one. And how you do prioritization and how you manage your product requirements. Actually, I guess it's hard to build a standard product which is a SaaS product and that case, which fits for so many users on a configurable way, how you deal with that
Björn Dröschel 14:31
What we have solved in this era, the greatest pain already so with us, you can flexibly implement ship from store click and collect, click and reserve its returns etc, etc, and generate added value for your customers. But however, we still have many ideas on our roadmap on how to turn this into an unforgettable shopping experience for the end customer. And therefore we are currently taking a two way 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, our prioritization is visible to our customers, and they should be able to participate. And where we, where we are heading in the future. The issue of configurability is very central to this fulfillment doesn't look the same anywhere, not even at the stores at the same retailer. So what I mentioned before, we are in the process of creating a solution where the retailer himself without tech support can configure his fulfillment process. So the solution is responsive, and the retailer can try new things in time. 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.
Markus Lorenz 16:06
Okay, that sounds super interesting. 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 the old structure or the old way of building infrastructure, and E commerce is outdated. What does composable commerce means for you clients and which opportunities and challenges you might see in there.
Björn Dröschel 16:34
And I would agree, so the time of monoliths is over too much, it's changing too fast for a provider to react quickly enough. To change the picture. I think that's why teamwork and expertise are key right now. So if I have a perfect command of what I can do, then I'm also in a position to adapt quickly. 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 I think this becomes a force, not a good one. And that's and that's how I understand composable commerce, many providers work together and everyone is an expert on his field. So 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 challenges together. Therefore, in the beginning, more coordination between many people is necessary. In the end, however, this gives the customer strategy against every anything that may come along. Yeah,
Markus Lorenz 17:49
I totally agree here. And it helps you to stay flexible in the future and definitely react to every market change with strong partners on your side, when it comes to those capabilities, which we are serving, at least in the composable commerce environment. And we're comparing that to maybe capabilities which a merchant should develop on his side, what would be your point of view? What capabilities should the merchant develop to fulfill the list logistic as part of the user journey?
Björn Dröschel 18:24
All of it has to do with fear, Kourosh mindset and technical affinity. When a retailer work with us, it's clear that we can't cover everything that's needed for a perfect omni channel experience. We can do fulfillment, and I think we can do it very well. But we see ourselves as a partner and help to look at the complete user journey together and bring the relevant providers together. fulfillment is a very important part of a successful user journey. Yeah, to describe it, Amazon is not so good, because the story is so beautiful. Well, you know, the Amazon fulfillment is great, and that makes it beneficial. But of course, it takes courage because in the future, you will work with many providers rather than just one to create the perfect experience. It also requires the right mindset because you're embarking on a journey that hardly any retailer is successfully implemented to date. You have to approach this task step by step and develop along the way 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. But you also need some people in the company with an affinity for technology, so who recognizes opportunities of the future? Drive it ever in what and how to ensure that appropriate data is made available, or you help us to make them available. Which the Yeah, individual providers need for the purposes?
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