minuteKEY
Like a child who grows out of a pair of shoes, minuteKEY has grown out of past processes and business models that were made for a smaller company. In July 2010, minuteKEY hit the market with its first few self-service key cutting machines. The kiosks, which are available in major retailers throughout the nation, combine innovations in robotics, electronics and software engineering into a high-tech kiosk that creates accurate, high-quality key duplicates. In the past five years, the company’s popularity with consumers has attracted retailers that continue to request more kiosks.
“We have about 2,500 machines now,” says Dan Peck, vice president of operations and supply chain. “When I came in August 2010 we were putting out our first dozen so it’s grown pretty dramatically.”
As retailers such as Walmart, Lowe’s and Menard’s continue to roll out more minuteKEY kiosks, Peck says the company expects to grow significantly again this year. While the company scales up, Peck and the supply chain team have made sure the company has the back-of-house resources to keep up with retail growth.
“When I first came on, the founders were sourcing from China to save money, but the long supply chain hindered our flexibility,” Peck says. “For something like keys, which are very heavy, the cost to expedite keys is huge because you’re shipping brass. I shopped and found a supplier in Mexico and moved that supply chain to Mexico. The lead times for keys dropped from six to eight weeks to one to two weeks.”
Reducing its shipping time provided minuteKEY the flexibility to meet short turnaround times and respond to customer demands – factors that have been necessary to its growth. “In the beginning, you grow in fits and starts, so being able to react quickly and fill up the supply chain as we got new clients was important,” Peck says. “Also, the cost to switch was pretty comparable.”
Going Electronic
minuteKEY is in the middle of another big switch as it transitions from using old paper processes to electronic–based supply chain solutions. The company is weighing different ERP systems so it can do away with simple spreadsheets and instead share information with colleagues via the cloud.
“While it’s amazing how far we can get using spreadsheets, we want the ERP because we want to be able to do some more sophisticated analysis,” Peck says.
minuteKEY’s S&OP is broken down by individual kiosk. Each kiosk is treated as an independent retail location for forecasting purposes. Peck says an ERP system will allow more accurate forecasts – breaking data down by region, retailer and individual site.
The company’s main supply chain stream is for the keys that stock its machines. The kiosks carry a wide average of between 1,000 and 2,000 keys per machine, depending on the version of the machine and where it is located. minuteKEY formed a cross-functional team that meets once a month to review forecasts and determine big-sellers.
“As you can imagine, around the country there’s a huge variety in demand – both quantity-wise and with the different designs,” Peck says. “So we are really looking to slice and dice our data in different ways and look by region and by client. Forecasting by machine and optimizing our key mix is important to drive sales.”
In addition to leveraging data, minuteKEY also partners with retailers to gain market insights. “Our biggest retailers – Lowe’s, Menards, Walmart – they are experts in retail and we want to take advantage of that,” Peck says.