Bennewitz^® (Germany)

Title:

• Traditional handicraft branches out into B2C e-commerce to penetrate new markets and increase turnover

Type of initiative:

• B2C

• Creation of an electronic platform for optical products and services

• Integration of current business in an electronic platform

Target groups:

• Consumers of replacement glasses or additional glasses who already have their visual aids needs documented and do not require an eye exam in loco

• Consumers of contact lenses and care solutions for contact lenses who already know their contact lens needs

• Consumers of cameras or optical instruments

Keywords:

• B2C e-commerce

• Internal development of an application-, process-, user- and partner-integrative e-commerce application

• Improved customer relation management

• Expansion of geographic customer base

• Increase in market share

• Increase in turnover

• Increased efficiency of business processes

• Reduction of costs

Location:

• Germany, Saxony, Annaberg-Buchholz

Timing:

• 1997 and on-going

URL:

• http://www.bennewitz.com

Short description:

• Applying internally developed software sCat and successfully joining traditional craftsmanship with modern information techniques the optical firm Bennewitz was one of the first European enterprises from the handicraft optical branch to make the move to the WorldWideWeb.

• Bennewitz.com allows on-line ordering of vision aids and optical instruments. Among the presently more than 1500 products offered are prescription eyeglasses, designer sunglasses, microscopes, contact lenses and contact lens care products, telescopes, cameras, orientation instruments, hygrometers, and scientific lenses.

• With increasing competition in the optical branch, growth could have been achieved by opening a branch of the firm in another location. Yet establishing a B2C operation on the Internet presented a far more cost-effective and less resource-intensive solution, allowing the firm to remain focused on its traditional strengths, while providing individualised customer service, low prices, and a quick turnaround of orders.

• Offering high quality optical products at far lower prices has allowed the firm to compete with larger companies. Through its strong visual presence on the Internet the company was able to improve its market presence outside the traditional local market to the rest of Germany and other German-speaking and English-speaking countries.

• Because its effectiveness and success other firms have requested licensed versions of the software application sCat. Thus, a sideline activity is the modification and licensing of this application.

Developer/operator/candidate:

• Augenoptik Bennewitz
  (Ulrike Apian-Bennewitz und Matthias Haase GbR)
  Markt 2
  
  09456 Annaberg-Buchholz
  Germany

Objectives:

• Increase turnover by expanding the geographic market reach of the firm, the brand name, and the products

• Linking the B2C processes with the internal business and administrative processes on the Internet, thus saving costs and better integrating business procedures

Achievements:

• Expansion of geographic customer base: Expansion of the market from a radius of around 50 km from Annaberg-Buchholz to the German national market. Due to the appearance of the site in the German language and a significant price differential, many on-line customers are now from Austria and Switzerland. The addition of English-language pages has facilitated market expansion, for example to the English-speaking countries and Scandinavia.

• Growth of on-line business/turnover: By late 1999/early 2000, about 40% of turnover was generated through the Internet; this share has expanded even further to around 60% of turnover by April 2002.

• Increasing efficiency of business processes/reduction of costs: The on-line integration of business processes has led to time and money savings, which are passed on to the customer in the form of lower product prices and quicker, more efficient services. In fact, customers can save up to 30% compared to other retailers.

• Sideline sales of successful software: Internally developed Software sCat is now marketed to other firms for similar applications in different branches. Several German and Swiss companies are now using this software or modifications of it for their own applications.

• In Germany Bennewitz has received significant official recognition for the success of Bennewitz.com and the underlying software application sCat:

  • Bennewitz is recognised as an example of "Best Practice" by the Saxon Agency for the Digital Economy (SET-Sächsische Entwicklungsgesellschaft für Telematik mbh) as well as the Saxon Working Committee for the Digital Economy of the Chamber of Industry and Commerce in South-West Saxony (Sächsische Arbeitsgemeinschaft elektronischer Geschäftsverkehr (SAGeG) bei der Industrie- und Handelskammer Südwestsachsen).

• In 1999 Bennewitz won the Saxon Multimedia Award "Digisax" for the best shop solution.

• In 2001 Bennewitz received the third prize of the "Internet Prize of German Handicrafts 2001" for its on-line service. The prize was awarded by the Federal Ministry of Economics and Technology of Germany (Bundesministerium für Wirtschaft und Technologie der Bundesrepublik Deutschland) together with the Central Association of German Handicrafts (Zentralverband des Deutschen Handwerks), Deutsche Telekom AG and the business magazine "Impulse" for outstanding innovative achievements in the application of the Internet in the business practices of handicrafts.

Detailed description:

• Bennewitz is a micro-enterprise with only 4 staff members; the very high complementarity of human resources competencies has allowed the firm to use exclusively internal skills for both the business and marketing strategy and the design of the dedicated software. Small size, flat hierarchy, short decision-making process facilitated a very quick realisation of new ideas. Flexibility, agility, and speed are distinct advantages of the micro-enterprise; but small size also limits capacity. Thus, the staff constantly work on weekends to provide a high level of customer service.

• Prior to moving part of the business on-line, the market of Bennewitz was limited to the local area near Annaberg-Buchholz, a small town, effectively constraining the size of the customer base. Customers physically came to the shop, underwent eye exams or brought in their prescriptions and made purchases in person. Now the firm serves customers world-wide: some orders have come from as far as Moscow and Los Angeles. Bennewitz has more customers online than through its local retail store and is looking into the possibility of expanding on-line service to more languages as well as increasing the customer service capacity.

• The software sCat comes together with the so-called QPA-Technology (QPA stands for "QuickProductAdviser" - a search technology where articles can be found by definition of their features). sCat was developed in-house and is also available to firms in different branches. The software development took place internally since at the time there were no affordable commercially available software solutions that would work well for the specialised requirements of the optical branch. After all internalisation contained the costs for the development of Bennewitz.com and its underlying application sCat.

• Bennewitz.com is based further on the following technology:

  • Multiprocessor systems running Linux-RedHat

  • Intranet (LAN)

  • Internet (WAN)

  • Linux versions of programming software for development of application-, process-, user- and partner-integrative e-commerce application sCat and QPA-Technology by using the PERL programming language for Unix-based web-servers employing Apache server software with a mod_perl module

  • Stand-alone and interlinked databases as well as front ends and interfaces for such databases

  • Web-based and browser-oriented storefront including order and track functions based on interlinked databases accessible via partially intelligent search functions

  • Web-based and browser-oriented administration area based on interlinked databases

• The internalisation of the project has ensured that operation and development of Bennewitz.com remains a "seamless process." A key element in success has been the ability to translate the particularities of the optical business into effective and efficient e-practices. The master optician and optometrist Matthias Haase (one of the co-proprietors) had extensive programming skills, which proved extremely useful in building the website. Alexander Apian-Bennewitz had strong legal and business skills (he studied law and recently became an optician, too) and the vision of expanding the small optical business to larger horizons. The intimate knowledge of their business allowed the staff to develop e-practices tailored to specific requirements without the attendant "translation losses" involved when an outsider is hired.

• The launching of Bennewitz.com necessitated a rethinking of the Bennewitz's traditional approach to doing business, shifting from customer service focused on face-to-face contact to customer service via digital media. The following are the main activities undertaken:

  • Building and maintaining of stand-alone and interlinked databases as well as front ends and interfaces for such databases

  • Establishment of a web-based and browser-oriented storefront, including order and tracking functions based on interlinked databases accessible via partially intelligent search functions

  • Continuous web-based and browser-oriented administration and processing of business processes based on interlinked databases

  • Linking of internal financial and administrative processes to external ordering process:

  • Adoption of an order tracking system

  • Introduction of on-line shop service outside of normal business hours: 24 hours, 7 days a week.

  • Adoption of "quick turnaround" customer service orientation - response to e-mail requests within 3 hours during business days, customers called back; orders filled within 48-72 hours; E-mail confirmation of orders; possibility for customers to monitor status of orders online. Return policy: Customer can return product within 2 weeks.

  • Adoption of broader geographic market approach: sales outside of region and country

• Adoption of proactive public relations approach

Assessment of impact:

• Better relationship with customers through quick turn-around and on-line advice

• Reduction in time needed to track orders - effective real-time registration of transactions in the administrative system

• Speeding up of the ordering process and the delivery of products

• Through an optimisation in the whole chain of business processes, Bennewitz is able to offer its products at substantially lower prices.

• The move to the Internet was undertaken internally, keeping costs very low. The critical factor in this was the business vision and programming skills of the internal staff. However, sustainability and growth of the initiative will likely require additional resources to expand the capacity to handle the increasing business of Bennewitz.

Links and references:

• Federal Ministry of Economics and Technology of Germany (Ministerium für Wirtschaft und Technologie der Bundesrepublik Deutschland), ef@cts, issue 02/2000 - Interview with Mr. Alexander Apian-Bennewitz

• Saxon Agency for the Digital Economy (SET-Sächsische Entwicklungsgesellschaft für Telematik mbh), Business Chance Electronic Commerce, 1999 - presentation of Bennewitz.com

• Saxon Working Committee for the Digital Economy at the Chamber of Industry and Commerce in South-West Saxony (Sächsische Arbeitsgemeinschaft elektronischer Geschäftsverkehr (SAGeG) bei der Industrie- und Handelskammer Südwestsachsen), Guidebook e-Commerce (Infoblätter e-Commerce), 2000 - Interview with Mr. Alexander Apian-Bennewitz

Contact:

• Alexander Apian-Bennewitz
  c/o Augenoptik Bennewitz
  Markt 2
  
  09456 Annaberg-Buchholz
  Germany
  
  Tel. +49-(0)3733-23494
  Fax +49-(0)3733-22660
  
  E-mail alexander_apian-bennewitz@bennewitz.com

sCat, QPA-QuickProductAdviser, QPA, QuickProductAdviser and QPA-Technology are trademarks of Augenoptik Bennewitz, Bennewitz is a registered trademark.
Copyright © 2002 Augenoptik Bennewitz, Germany
All rights reserved.