Co-Op Solves Connectivity Problems With Satellite Service
Written by Paul Froehlich, Integrated Solutions For Retailers Magazine
Do it Best Corp. is a $2.4 billion hardware, lumber, and building materials cooperative with more than 4,300 co-op member-owners. Stores are located in remote areas where broadband Internet connections are prohibitively expensive or unavailable. Store owners relied on dial-up service for e-mail, credit card processing, and communications with Do it Best corporate headquarters. The sluggish connections translated to slower customer checkout times and inefficiencies for store owners. So, when Do it Best unveiled its "Getting Connected" strategy, designed to enhance store communications between the Fort Wayne, IN headquarters and retailers, many store owners were unimpressed. Why get excited about online catalog order placement, shipment tracking, and transmission of product, sales, and promotional data when you're stuck with dawdling dial-up service?
"To help owners improve their connectivity, we looked for an alternative means to deliver a robust, secure, cost-effective way to share information and improve owner productivity," explains Kay Williams, the co-op's vice president of information technology. Do it Best found its answer by offering its membership off-the-shelf, commercial-grade satellite connectivity, Connexstar CX-500, provided by Spacenet Inc. "As a co-op, we do not mandate technology to stores," says Williams. "We do have some proprietary applications in place and follow basic standards across the enterprise. But, retailers have great autonomy. They select their own POS providers and have network configurations as unique as their stores."
The corporate office agreed to front equipment and service costs, charging it back to participating retailers as a low monthly fee — roughly the same cost as business-grade DSL (digital subscriber line) service. Still, each store owner had to be convinced that the cost of satellite service would be offset by increased efficiencies.
Those Do it Best retailers opting in to the 360E VSAT (very small aperture terminal) platform receive accelerated Web-based and e-mail applications optimized by embedded TCP/IP (an open computer communications language). Maximum download burst speeds range between 150 and 1,000 Kb (kilobits) per second. Upload speeds depend upon competing traffic activity.
The typical turnkey store installation includes a roof- or wall-mounted 24-inch by 36-inch satellite dish and a small, indoor satellite modem. In some areas, larger dishes may be required. The dish is connected to a modem by two coaxial cables. The modem connects to the store's network, POS, or standard PC using CAT5 Ethernet cable. Although the Connexstar VSAT platform is a closed environment, which delivers inherent security, some stores have installed firewall protection for added peace of mind.
The satellite feeds are routed through a hub located at Spacenet's McLean, VA headquarters, then directly to the stores. Satellite service is provided by Spacenet parent Gilat Satellite Networks Ltd., of Petah Tikva, Israel. Spacenet installed the systems, manages the hub, and also provides second-level help desk support.
Five-Second Credit Card Processing
The VSAT platform has brought affordable, secure high-speed Internet access to Do it Best store owners throughout remote stretches of the country, such as Alaska, Hawaii, Wyoming, Texas, Idaho, Michigan, Wisconsin, Iowa, and Indiana. Typical hub availability figures usually range above 99.7% on a year-over-year basis. The Do it Best corporate portal, which provides breaking news and the ability for retailers to download and customize ads, is recording greater use, Williams reports. The company also is poised to offer stores in-store music, video feeds, and Web conferencing.
Initial testing began in summer 2002. Since then, more than 350 retail sites have installed VSAT technology, with an overall corporate goal of 1,000 stores. Store owners are experiencing tangible results. For instance, a multiple-store owner in Texas is saving an estimated $80,000 annually in telecommunications costs. Another single-store Do it Best retailer in Michigan slashed average credit card processing times from 45 seconds for dial-up service to 5 seconds. The store owner estimated he's recouped 10 hours per month, saving labor costs, increasing customer throughput, and improving customer service.