Tonercycle / Inkcycle: Growing from a Basement to Big Box Retailers

January 22, 2019

COMPANY PROFILE
TonerCycle/InkCycle began nearly 25
years ago in the founder Rick Krska’s
basement, where empty ink cartridges
were collected, reworked and sold to local
businesses. Since then the company
has grown to hundreds of employees
concentrated in three distribution facilities
in Kansas, California and Pennsylvania,
where they reengineer cartridges
to the highest quality standards and
distribute them for big box retail,
private label branding and distribution
programs, drop-shipment, and office
product dealers worldwide.
With such rapid growth and increased
demands from retailer customers, the
Kansas-based TonerCycle/InkCycle
required a high level of automation in
order to cut operating expenses and
increase profitability. This led them to
become one of the early adopters of
DiCentral’s supply chain integration
solution.

THE CHALLENGE

In addition to improving customer satisfaction, DiCentral’s solution ensured that TonerCycle/InkCycle remained compliant with the EDI and business rules mandated by its retail customers. Big box retailers maintain strict shipping requirements that included fines of up to $100,000 per business rule violation. By improving automation and eliminating manual errors, the company was able to avoid noncompliance and the resulting chargebacks.

David Kroenke, Director of IT for TonerCycle/InkCycle, stated, “What we’ve found here is the more we used the software, the better the value proposition is, the more effort we applied, the less people we needed. Overall, I believe our investment in DiCentral’s solutions has paid for itself many times over for labor saving and efficiency.”

In 1999 the CFO of TonerCycle/InkCycle estimated the cost of processing an order from start to finish was $18 per order. The goal was to reduce costs to one dollar per order. This would require a sophisticated enterprise resource planning (ERP) platform and electronic data interchange (EDI) integration. By implementing DiCentral’s scalable suite of services including EDI translation and mapping, TonerCycle/InkCycle was able to implement processes and procedures for IT, and automation capable of handling incoming orders.

Within one year, Kroenke put together the company’s first e-commerce site with integration for accounting software, allowing TonerCycle/InkCycle to automate order fulfillment, thereby reducing manual order entry.

“We continued to grow at a rapid pace,” Kroenke continued, who’s been with the company through the entire DiCentral adoption process. “And we never would have been able to keep up with the demand without DiCentral. When an order is placed, it gets automatically released and a ticket prints out in the warehouse within minutes. The package is brought over to the FedEx machine, and by the time they’re putting the label on the package, the tracking information is already on its way to the customer.”

Today, Kroenke’s role is more strategic. He meets with customers regularly to determine how to best approach simplifying their business. To help with this approach, TonerCycle/InkCycle relies on DiCentral solutions to generate unique barcodes that communicate order information to the ERP system. As a result, employees need only confirm a master packing slip, instead of having to unwrap and unpack the entire delivery.

The TonerCycle/InkCycle ERP platform fully automates orders for specific customers by  automatically reserving products from different warehouses, enabling the order to be  processed hands-free. Employees are then able to focus on more urgent priorities as the  order makes its way to the warehouse tasked with shipping.

“In the beginning, customer service reps would take 20 orders over the phone,” Kroenke  reflected. “Now, three service members take 500 orders and ship 1,000 packages a day.”

SCALABLE SOLUTIONS

TonerCycle/InkCycle required EDI solutions to create private labels for a big box retail chain  and before long, they were fulfilling orders to thousands of stores across the country. The  demand for unified electronic commerce clearly became more urgent.

In the beginning, customer
service reps would take 20
orders over the phone. Now,
three service members take
500 orders and ship 1,000
packages a day.

 

-David Kroenke
Director of IT for
TonerCycle/InkCycle

According to Kroenke, the company began with about 2,000 stock keeping units (SKUs) and several hundred customers. TonerCycle/InkCycle sales reps had developed their own tailored pricing that had created up to 12 billion combinations of customer pricing.

As the company grew to meet the demand, TonerCycle/InkCycle established a funnel with the ability to determine whether incoming orders required manual intervention. DiCentral’s supply chain integration suite was used to serve those unique cases, as well as to manipulate and map extensible markup language (XML) and delineated files, process advanced shipping notifications (ASNs), and interface over the web using AS2 and file transfer protocol (FTP) connections.

To gain control over the supply chain, exchanging transaction data with key trading partners in an automated, integrated, and seamless manner was simply the beginning. The comprehensive solutions provided by DiCentral help the company maintain the funnel in the following capacities:

  • Receiving and translating purchase orders into readable formats
  • Verifying compliance with all rules for each trading partner
  • Mapping all data into ERP systems
  • Adding orders into accounting systems
  • Processing ASNs
  • Creating customized shipping labels

“We had to add integration to the ERP and e-commerce platform to account for the customized pricing and automated e-commerce that assisted our customers without building each one their own unique e-portal,” Kroenke says. “Not everyone sees integration as a requirement. They just want to email us their orders and it’s up to us to innovate and streamline the processes we use to manage that information and fill those orders.”

Today, Kroenke said the TonerCycle/InkCycle e-commerce site includes industrial and financial application-specific integration that enables customers to place an order without requiring customer service to key in each order. Customers can also save a list of previous orders and drop ship locations. When the order is placed, customer service no longer needs to key the order.

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