This article first appeared in the August edition of MHD Supply Chain News.
“Our B2B died during COVID-19 lockdown but our B2C sales went through the roof by 460 per cent. We usually hit two million sales a month, but in the week before the end of the financial year, we had reached 1.1 million customers in just seven days,” Ammar Ahmad, CEO of AMR Hair & Beauty says.
AMR is Australia’s fastest growing hair and beauty supply enterprise and is becoming one of the nation’s leading e-commerce businesses. In the past three months, Ammar Ahmad, CEO of AMR Hair & Beauty says his business has experienced product sales that would usually take more than a year to achieve.
During the peak COVID-19 period in Australia from March to June, AMR Hair & Beauty sales were up more than 250 per cent with upwards of 240,000 users a month on its website.
According to Australia Post’s 2020 e-commerce Industry Report, beauty shoppers are among the most engaged online. They are increasing their purchasing frequency and demonstrating an increased confidence in buying these items online. The beauty e-commerce industry is up 18.8 per cent year-on-year and online transactions account for more than 53 per cent of sales for this industry.
Though Ammar has already had a fairy-tale ending, this isn’t his final chapter. The hair and beauty supplier started AMR Hair & Beauty in 2004 at the age of 14, and now he has branched out to sell an array of products across 17 websites that are fulfilled from one 22,000 square metre warehouse in Ingleburn, Western Sydney. The company now boasts a multi-million dollar annual revenue figure.
“Beauty doesn’t die. I have four sisters at home and when they have fifty bucks and they’re hungry, they will spend every cent on make-up to look beautiful instead of eating. Beauty is one of the highest priorities,” Ammar says. As a teenager, Ammar worked in hair salons and as a night-time cleaner and noticed that there was a large gap between quality products and low pricing.
The company aims to source, import and supply the finest quality products from across the globe and deliver them directly to salons and customers Australia-wide. From beginning his business in a van at the age of sixteen, going salon to salon, door-by-door, to now becoming a multinational business that services hundreds of thousands of salons and consumers across the country, AMR Hair & Beauty’s continuing success meant a shift in its warehouse management solution (WMS) to cope with the constant product and sale growth.
Every make-up user knows that although eyeshadow, blush and mascara are important tools, the key to a perfect face is all in the foundation. Two years ago, the company underwent a major IT restructure in order to leverage its omnichannel position in the market. “When we moved into our new building, I lost $4.8 million dollars with a 3PL who promised us they could deliver on time, we realised in the overhaul that 3PL wasn’t for us and we wanted to strengthen our independence,” Ammar says.
“We were using an in-house developed ERP that simply went from our WordPress site. We had a WMS, but it was really slow and wasn’t cloud-driven and would randomly turn on and off,” he explains.
AMR Hair & Beauty simultaneously runs 17 different websites that sell different products from beauty salon equipment, shoes, tea, watches to toothbrushes. “We needed a WMS that operates from the same warehouse and Microlistics came back as the only company who were the perfect fit for picking multiple products for multiple clients 24/7,” he says.
Ammar says although his business operation isn’t 3PL, it was important that the WMS he was going to employ was able to be seamlessly integrated with its multi-channel needs that require different priorities. “Some businesses we promise dispatch within the hour and for others we have a few days up our sleeve, so meeting our diverse needs was a critical tick to my box when we discovered the capabilities of Microlistics,” Ammar says.
Ammar strongly advocates for unification in the warehouse. He claims the seamless approach for his company is not having designated pickers for certain brands or products as that causes confusion and unnecessary labour. Now, any picker has access to any product in the warehouse and although they are segregated and categorised accordingly, it’s all under the same roof with a universal WMS. “In our warehouse now, our pickers all walk around with the same handheld picking device, so if you’re ordering a watch or a hair dryer, your order will go out first because consumers hate waiting,” he says.
“Microlistics is one of the only WMS that already has an API for shopify, Magento and WordPress e-commerce platform software that our brand websites use.” Ammar wanted adaptable diversity for his businesses 14,500 Stock Keeping Unit (SKU) that are a mixture of furniture, consumables, hair and beauty products. In May this year, 40,500 pick lines per month were recorded with 1,400 receipt lines in June.
Ammar is hoping that soon all his products will be able to be picked for same day delivery and with his successful track record, it may not be too far off. “We’ve always invested in good data and Microlistics data reporting is so simple to use. Everything is precise, and this is the first WMS I can comfortably say has never let our operation down. We went from 25 warehouse pickers to just five for the entire company.”
Ammar says rotational products are key, as is rapid delivery, and his businesses use a program called Smart Freight, a carrier management module complimentary to the WMS, to ensure product orders reach customers in the shortest time possible. “Smart Freight knows the best carrier to reach the delivery address of an order, and because it is integrated with Microlistics, the WMS sets priorities for picking and despatch to ensure we hit all our delivery targets,” he says.
Every website that promotes one of the 17 brands Ammar operates is run independently. “We want to keep every company and its brand exclusive. There are teams in house that run each product range and they’re all competing against one another, it’s quite an exciting environment,” he says.
Ammar’s most recent brand launch will be titled ‘Heir’ and will be a range of exclusive watches for consumers. “We have different boxes for different products, so if you order an Heir watch or a packet of tea from the Tea Centre website, you’re always going to get different cartons and you’ll never think they’re shipped from the same warehouse,” he says.
He prides his business growth on his team and their ambition. “All of my start-up businesses are ideas from my key personnel. I believed in their talents and turned around and said look, I’ll invest in your brand and let’s keep it under one warehouse, purely because they have helped me grow AMR Hair & Beauty and I want to see them explore their own passions,” Ammar says.
He believes having the ability and the agility for your WMS to adapt to new products and changes is fundamental to a smooth business operation. Ammar says his brands are mainly imported from Italy, South Korea and China and supply chain disruption during COVID-19 lockdown measures turned the company upside down overnight. “Nail shops and salons were closed, which put a massive halt to our B2B sales. But within eight weeks, consumers were madly purchasing salon products to make their own at home set-up whilst beauty parlours they usually attend were closed to the public,” he says.
“Different times mean different adjustments to consumer and business needs that are reshaping our inventory management. We don’t want to step out of our boundaries too much, but we want people to walk into salons and say ‘Hey! I want this brand.’” Ammar says.
He thinks the secret to a consumer’s heart is customisation and being as quick as possible to attend to their demands. Ammar says social media has boosted his businesses’ service level and personalisation through messages and packaging has brought in more online customers every day. “When you hit them in their heart, you find that they will share their positive experience to their online following and we’re working on that a lot more,” he says. Ammar is also keen to tap into supply pharmacies as more competitors battle to stock hair and beauty brands but is confident that the beauty industry is as beautiful as ever.
“I’m always developing my hair and beauty knowledge. If we’re able to keep fulfilling from our one warehouse we’ll be able to tell all hair care operators to bring their stock to us and we will fulfil it for you at a very reduced rate and then the long term goal will be landing a place on the Australian Stock Exchange.”