Analytics platform helps online coffee startup raise its decision-making game

Many corporations have mission statements posted on their websites, but few firms live up to those ideals as closely as Black Rifle Coffee Co., a Salt Lake City-based startup that is founded and staffed by combat veterans.

Its branding begins with the company’s mantra—”Black Rifle Coffee Company serves coffee and culture to people who love America”—and extends throughout the photos, memes, and videos it shares on its social media accounts. The business was launched in 2014 by former Green Beret and CIA operative Evan Hafer, who describes his approach to business this way: “Black Rifle Coffee Company is quite literally the combination of my two favorite passions. I take pride in the coffee we roast, the veterans we employ, and the causes we support.”

Driven by that focus, the firm has been expanding at lightning speed. The company is on track to grow from $80 million in revenue in 2019 to more than $100 million in 2020, thanks in part to a spike in orders driven by the travel bans and work-from-home mandates levied during the Covid-19 pandemic, according to Chris Omer, Black Rifle’s vice president of information technology. With Americans turning to the online grocery sector to supply their food, Black Rifle has ramped up its operations from shipping about 80,000 one-pound bags per week during April 2019 to more than 140,000 bags per week in April 2020.

Until recently, the company had just 18 people in a single warehouse packing one bag at a time at manual stations. To keep up with soaring demand, it has now added another warehouse, a second coffee-roasting machine, a second work shift, and automated systems, Omer says. And to manage the increasing complexity of those operations, the firm has boosted its investment in technology and professional services. No longer operated out of the founder’s garage, the firm now uses an e-commerce platform from Shopify, contracts with third-party logistics specialist Geodis for fulfillment services, uses a warehouse management system (WMS) from Oracle Corp. (specifically, the warehouse module from Oracle’s NetSuite line), and uses a data analysis platform from Seattle-based SoundCommerce.

DATA MINING PAYS OFF

That last one has been a real game-changer, according to company leaders. The SoundCommerce platform allows Black Rifle to normalize data from many sources, aggregate it in one place, and see daily revenue models. That unified approach lets the company compare costs and revenues from several different departments simultaneously, such as marketing, order and inventory management, and financial reporting and business intelligence. By examining all those areas at once, the firm has been able to make better business decisions. “So when marketing wants to run a sale, it can run it by supply chain to make sure there’s enough product. And that’s a gift,” Omer says.

Another benefit was discovering the correlation between different variables, such as product freshness and customer satisfaction. “We found that when we were able to ship product within a week, our customer satisfaction scores went way up,” Omer says. “And that drove us to look at inventory turns and shelf life, so now there’s a just-in-time model between the manufacturing department and the fulfillment center.”

The ability to make those correlations also gives the coffee supplier a better view of the overall financial picture, SoundCommerce executives say. According to company CEO Eric Best, the platform, which tracks real-time operations and marketing events, profitability, and customer lifetime value (CLV), allows users like Black Rifle to optimize their marketing and media spend in relation to goals like profit and CLV, rather than just revenue and return on advertising spend.