How a Seller of Outlandish Party Costumes Optimized Its Warehouse to Grow 400% & Compete With Amazon

Should warehouse software be sexy? Certainly not but if you're still using warehouse software that was built decades ago and still printing pack and ship lists- you're not alone. The founder featured in today's post found himself in the equivalent of warehouse hell as his company continued to grow. If he was to further scale his business, which sells outrageous party costumes, he'd need an edge in the warehouse. Not only is he revealing exactly how he now tracks order fulfillment in real time, but also the unique KPIs used to measure warehouse employee performance so you too can squeeze additional efficiencies out of your fulfillment operations and compete with the Amazons of the world ...

Nothing but boring corn fields …

That’s how Chris White describes the landscape surrounding his alma mater DePauw University in the central Indiana town of Greencastle.

But before you start to feel bad for White — or the nearly three thousand other college students who found themselves stranded in a rural area with nothing to do — consider that DePauw, according to White, punches above its weight when it comes to creatively having fun.

“It’s home to a really rowdy party culture,” White says. “I know you’re thinking, ‘What the hell?’ but we always made the top ten party school list when I was in school.”

So how do thousands of college kids break the monotony of corn country?

“It’s an interesting social scene,” White recalls. “We all partied together.”

And these aren’t your average parties …

Because there was nothing else to do, White and his classmates made theme parties to pass the time. These themed parties naturally involved costumes — retro, humorous, or just plain weird — designed to turn heads and crack smiles at themed parties, festivals, or events.

When I graduated I had a massive closet full of costumes. We’d build our costume collections by going to thrift stores, Goodwills, and estate sales.

But just as White was set to graduate he caved to convention.

White planned to go on and earn a dual MBA-JD graduate degree and enter the professional world. It meant eventually he’d have to trade those whacky costumes for tailored suits.

So White got rid of his entire costume collection, a decision he’d soon regret …

The Most Outrageous Costumes Known to Man

White quickly realized how wrong he had been dumping his costume collection.

Instead of outgrowing crazy themed parties and events, he missed them dearly. The difference though was that now White had the money to buy great costumes, but not the time to visit the various stores necessary to build a collection.

So in the Fall of 2014, White and Jens Nicolaysen launched an ecommerce store with five thousand dollars and began selling vintage items like Retro Descente Ski Onesies from the 80s, early 1990's Team USA jerseys, retro 90's surf brands, and styles from the 80s and 90s like Jams World. It was a self-described scrappy effort with few resources but the two quickly sold out and learned they weren’t alone in their adult affinity for the costume glory days.

Those were the early days of Shinesty, which now sells the most outlandish collection of clothing the company’s founders say the world has ever seen. Beyond vintage clothing, the company offers patriotic outfits, humorous underwear, party suits and the like. In White's words:

These are the most outrageous outfits known to man all in one place.

The concept hinges on the premise that people — even into adulthood — desire something special to wear when going to an event, music festival, or party.

Shinesty is a one-stop-shop for these types of costumes and allows even busy professionals with an itch for themed parties to find what they want without having to root through thrift stores and estate sales:

We want to be the number one place people come to for event driven commerce.

There’s evidence this is becoming the case when you look at demand during busy times like Halloween and Christmas. For example, White admits to significantly under forecasting demand during those periods which created operational issues.

Shinesty would sell out of inventory so quickly, White and Nicolaysen were forced to break some bad news to employees during the holidays.

“People with office jobs had to pull all nighters in the warehouse,” White says. “At six o’clock we’d say, ‘Okay, everyone to the warehouse so we can pack and ship all these orders.’” It’s a culture built on smarts and an irreverent sense of humor.

Unfortunately, that warehouse so integral to Shinesty’s success was as vintage as some of the costumes it housed and would need an update if the Shinesty team wanted to succeed over the long term.

A New Metric: PPH (Picks Per Hour)

From the very beginning Shinesty has operated its own warehouse …

It has to if it wants to slip handwritten notes or surprise gifts into many of the orders it packs and ships.

The added touch differentiates the company and is one reason Shinesty grew 400% between 2015-2016 and upgraded to Shopify, a commerce platform for high-volume merchants focused on growing quickly.

“Shopify allows us to scale our sales without having to worry about sudden traffic increases,” White says. “It’s reassuring because traffic spikes happen a lot when you sell products as ridiculous as we do.”

Equally important is Shinesty’s recent warehouse upgrade. The company now relies on ShipHero, which offers a mobile warehouse management solution that helps merchants manage inventory, pick, pack and ship.

Prior to ShipHero, Shinesty was running its warehouse with technology ShipHero argues hasn’t been updated in decades. For instance, until switching Shinesty was still printing hard copy pack and ship lists.

“Our old software was terrible and looked like the old DOS operating system,” White says with a laugh. “While warehouse software doesn’t have to be sexy, ShipHero is by far the slickest and has really helped us save time and money. The interface makes it really easy to teach the system to new employees.”

Here are two of the ways ShipHero is helping Shinesty scale more efficiently:

• Batch Picking: pickers receive a list of items to pick on their mobile devices and can more quickly and efficiently fulfill a single order with multiple items, multiple orders containing the same item, or multiple orders with multiple SKUs (multiple batch picking)

• Intelligent Pick Routes: the list sent to a picker’s mobile device is arranged to maximize efficiency and minimize the walking distance between inventory bins

Whereas the old platform made it difficult to measure performance, Shinesty now has KPIs for its warehouse pickers and can easily identify high performers by number of picks or orders shipped per hour.

“It helps us measure our results and identify high performers,” explains White. “Jens and I sprinted up and down the aisles and did a pick and pack list ourselves to set the standard and prove that if we can do it anyone can.”

ShipHero’s warehouse management system allows Shinesty to track inventory and order fulfillment in real time which positions the company to ship orders in the most efficient way possible. It can also help White respond more quickly when demand for a popular item exceeds expectations.

“We help our customers get bigger and compete with the Amazons and Walmarts of the world. The warehouse technology out there hasn’t changed in decades and we wake up every day excited to help merchants save time and money.”

Adam Rosenberg, Director of Operations &
Business Development at ShipHero

In a world where free shipping is increasingly expected, margins can quickly erode and merchants can easily find themselves fulfilling unprofitable orders. It’s why higher performing merchants are thinking inside the box and actually turning fulfillment into an invisible point of differentiation that increases margins.

“Running your own warehouse can be a time suck and major headache,” White concedes. “But ShipHero gives us the ability to run our own warehouse in a way that gives us a competitive advantage.”

The retail graveyard is littered with tombstones commemorating the death of bygone gag gift and party retailers ...

How does White plan to avoid the same fate?

White’s New Costume Closet

Costumes and gag gifts but nothing else.

It’s a surefire way, according to White, to quickly slip into retail obscurity.

And it’s why White plans to do something he says major party suit retailers historically have not: build a brand.

For us it’s all about humor and creating a brand that reminds people of the good times. You can’t compete on product and supply chain alone or you’ll lose to Amazon.

In addition to building a lifestyle brand and continuing to optimize its warehouse, White suggests Shinesty will expand to offer outlandish clothing and costumes in 10-20 different verticals. “We’ll have to evolve,” he says. “We want to be the destination for anyone planning to do something fun.”

Speaking of fun …

Remember the massive costume collection White regrettably dumped thinking there was no place for them as a business professional?

Care to bet whether he has restocked his closet?

“Of course,” White says with a laugh. “Now I have an entire warehouse of costumes.”