This way up
Not all SME transformations involve a 360-degree flip. For four-year-old Fluent Commerce, it was a case of splitting the company into two to allow each business unit to focus on what it does best. Rather than “a case of seeing the writing on the wall and needing to pivot, we’re exploiting an opportunity”, says CEO Graham Jackson.
Fluent Commerce’s genesis was in ParcelPoint, which operates a pick-up and drop-off network for online retail fulfilment and returns. To do that, ParcelPoint developed software to control operations, handle delivery and manage product returns. The software started to attract the attention of retailers wanting to run their own click-and-collect services.
With a focus on distributed order management (brokering orders across multiple systems and multiple parties), Fluent Orchestration Cloud can address all the requirements of unified commerce or omnichannel retail where customers buy goods online, through kiosks, in pop-ups and in bricks-and-mortar stores. For retailers, the challenge is “the inventory is all over the place and you have to fulfil the order without busting your margin”, says Jackson.
That’s what Fluent Commerce focuses on. But running a software business is very different to running a logistics and fulfilment company. So in 2016, Fluent Commerce separated from ParcelPoint. At the same time, it brought in Jackson, an outsider with years of software company experience, as CEO, which reinforced that Fluent Commerce was a separate, software-centric business. “There’s a big difference in terms of investment, expertise and skills for a freight company versus a software company,” he says.
Fluent Commerce’s software is now being used to allow click-and-collect services for retailers such as Big W, Woolworths, Seed and French Connection. ParcelPoint remains a client and Fluent Commerce also has its first customers in the United Kingdom.
According to Jackson, Fluent Commerce can now raise capital as a software company, hire expertise as a software company and invest in research and development as a software company.
He says it’s important for SMEs to “recognise if you have something golden or not”, adding, “You have to understand your market and whether you are valid on a global scale. Do the market research and understand the competitive landscape.”
And if you do have something golden? “At that point, anything not focused on that part of the company is distracting,” says Jackson. Hence, the separation of Fluent Commerce and ParcelPoint – though he acknowledges it took three years to refine the model and for everyone to be convinced before the separation took place.
To succeed in the end, Jackson stresses, “You need a singular focus, you need a supportive board and you need supportive investment.” Plus, people in the company “can’t have two jobs” and management can’t be operating to two separate agendas.
The decision to demerge has led to significant growth for both businesses, says Jackson, and it’s become easier to attract technology specialists to Fluent Commerce. “If it’s unclear and murky – what is a freight company, what is a software company? – it’s difficult to attract the right staff.”