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“B2B is a very small ecommerce business and is a very small percentage of the company. It doesn't get as much attention, focus, or investment, simply because there's not broad acceptance of ecommerce being the way forward in a lot of those segments. And I get it. I get [the] resistance. I get why those hurdles exist … We consciously took aim at all of those things and made sure that we would not run into the same issues at Dawn.”
— Gireesh Sahukar, Vice President of Digital, Dawn Foods
Successfully enacting an ecommerce vision is hard. It requires shifting how a business executes its processes, manages its people, and engages its customers. It demands full-scale transformation across the enterprise, which is why many companies often stumble as they bring their ecommerce vision to life.
Dawn Foods is the exception. Over the last two and half years, the 100-year-old company has transformed itself into a digitally driven business to better serve the business-to-business (B2B) buyers that purchase its products.
Gireesh Sahukar, vice president of digital at Dawn Foods, joined a recent episode of "Unpacking the Digital Shelf," "A B2B Success Story," to share how Dawn executed its ecommerce vision — and how other B2B businesses can, too.
Dawn had a "fairly early 20th-century view of doing business" when it started its digital journey, Sahukar says in his previous appearance on "Unpacking the Digital Shelf."
However, Dawn, a leading bakery ingredient manufacturer, knew it needed to change by becoming more technology-enabled and embracing automation.
Over nearly three years, the company has worked to develop an effective ecommerce strategy. Sahukar says the pandemic also accelerated the company's digital journey, leading Dawn to redesign its direct-to-consumer (DTC) sites for B2B buyers and enable more self-service.
The changes couldn't have come at a better time, as both B2B and business-to-consumer (B2C) companies now deal with headwinds like inflation, supply chain issues, and ongoing labor shortages.
Sahukar says these challenges are especially prevalent in the food service industry. Rising logistics costs, supply chain disruptions, and an aging workforce have made it more challenging for B2B companies like Dawn.
"With a slightly older aging workforce in the B2B industry, we've got a labor challenge. Most of the drivers are 50 and over, so that's a workforce that is looking more towards retirement and not towards the other spectrum of their careers. So, we've got labor shortages that are working against bringing these costs down," Sahukar says.
All of these headwinds call for companies to digitally innovate to run their business more efficiently. Dawn has leaned into a multifaceted, digital-first strategy to transform its business — focusing on everything from recruiting great digital and tech talent to automation, process optimization, and upskilling its team.
Sahukar says Dawn is "in a climate where we are trying to protect and operate our business as effectively as we can." To that end, the company has leveraged automation to improve its manufacturing processes and run more efficient routes.
"For example, if we run a route from our New Jersey distribution warehouse to all over New England, [we consider] what [we can] do on the backhaul to make that truck be efficient in taking some other raw materials along the way, loading it up, and taking it back to our distribution center," he says. "It can then go into our manufacturing plants from there so that reverse logistics and backhaul processes are becoming more efficient and provide some cost controls for us. So, a lot of it is focused on that."
"We've been very successful in bringing in digital talent and helping them understand how ecommerce works [and] how B2B ecommerce works — and helping them deliver value for our customers."
— Gireesh Sahukar, Vice President of Digital, Dawn Foods
Dawn has also capitalized on recent contraction in the market, as other private sector companies slow down hiring or lay off workers in advance of a potential recession. Dawn has recruited ecommerce and digital talent from technology companies to support its new ecommerce vision.
"We are looking at the talent that is becoming available and trying to attract that talent, so we can grow our internal teams," Sahukar says. "What we think — and this is our theory of the case here — [is that] we have an ability to teach this technology talent or this digital talent. We think we can bring them in-house, and we can teach them how B2B works."
By the end of this year, Dawn will have grown its innovation team to about 20 people, with new skilled talent across product, engineering, and operations.
While Dawn has recruited new talent, it's also focused on upskilling its existing workforce. The company has open office hours where anyone can come in and ask questions of other cross-functional teams. Dawn has also created new playbooks for its sales team to help sales representatives better serve B2B buyers.
"We put a lot of these playbooks together to help our sales reps become trusted business advisors, and we are going deeper into putting those playbooks out into the field — giving guidance on how our products can be used in multiple ways," Sahukar says.
For example, Dawn's sales reps have given customers guidance on how to use the same donut mix in three different ways without any additional effort, which potentially enables these B2B buyers to expand their product lines and increase revenue.
Creating these sales playbooks hasn't been a huge lift for Dawn, since the company is just repurposing existing content. The playbooks are one approach Dawn is using to deliver more value to customers, and, in turn, cultivate greater customer loyalty.
Dawn has also focused on process optimization as a way to drive organizational transformation and enact its ecommerce vision.
As the company explored process changes, Dawn also considered how these changes would reshape the day-to-day work of each of its teams — from employees who worked in manufacturing and in its distribution centers all the way through its sales representatives and bakery experts.
"We went to each one of these teams, and we discussed it at length. We provided open insight on what ecommerce means for all of us," Sahukar says. "Ecommerce is just the pretty front door, but we need to get the rest of our business processes aligned and reimagined because ecommerce will expose all of the inefficiencies in your business processes and in your workflow."
Dawn examined each of its business processes and optimized them for a new ecommerce-driven business model. The company has continued to review and reinvest in process optimization, along with empowering its line of business leaders to share a unified ecommerce vision and message.
"The heavy lift was not in building technology. The heavy lift was in understanding processes, understanding the people's impact from making process changes, and driving those process changes to align with the launch of ecommerce," Sahukar says.
All of these changes have led to ecommerce growth for Dawn. Ecommerce is now the primary channel in its artisanal bakery segment. The channel is also growing in other customer segments, including large bakery customers with multiple locations.
"We have seen our ecommerce customers deliver higher margins and higher [average order values] since we launched," Sahukar says. "That has stayed the same as we've grown the ecommerce side and as we've become a nine-figure ecommerce business."
Dawn has discovered that ecommerce can drive higher margins in B2B. Other B2B companies that want to grow their business — and become more resilient in these challenging times — might benefit from following Dawn's lead.
To hear more about Dawn's ecommerce transformation, listen to the full episode.
