What started as an investment in a new enterprise resource planning system has ended in a new e-commerce platform that's giving Donaldson a state-of-the-art system that’s now operational in about 100 countries.

At Donaldson Co. Inc., a 103-year-old manufacturer of filtration systems and replacement parts, updating B2B e-commerce doesn’t begin and end in a trickle.

The way the Bloomington, Minnesota-based company likes to go about e-commerce is with a full-out gush. A year ago, the company’s outdated and mostly internally developed and operated e-commerce platform was anything but an effective channel for international sales growth, says global director of e-commerce Peter Duhart.

But what started four years ago, with a more than $90 million investment in a new enterprise resource planning system and culminating this year in a new multi-million dollar e-commerce platform from Oracle ATG, has given Donaldson a new state-of-the-art e-commerce system that’s now operational in over 100 countries in North America, Europe, South America and elsewhere, Duhart says. “We had silos and limitations between business units and now we don’t,” he says.

As a manufacturer, Donaldson sells to diverse companies in a wide variety of vertical markets. Products in the engine products segment consist of replacement filters for both air and liquid filtration applications, air filtration systems, liquid filtration systems for fuel, lube and hydraulic applications and exhaust and emissions systems. The engine products segment sells to original equipment manufacturers in the construction, mining, agriculture, aerospace, defense and truck end markets and to independent distributors, manufacturer dealer networks, private-label accounts and large equipment fleets.

We anticipate more than 10,000 orders per month—a number which we expect to grow over time.

Products in another business unit—industrial products—include dust, fume and mist collectors, compressed air purification systems, gas and liquid filtration for food, beverage and industrial processes, air filtration systems for gas turbines, polytetrafluoroethylene membrane-based products and specialized air and gas filtration systems for applications such as hard disk drives and semi-conductor manufacturing. This segment sells to various dealers, distributors, manufacturers of gas-fired turbines and various companies requiring clean filtration parts and replacement filters.

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Donaldson is no stranger to e-commerce. The company first began selling online more than eight years ago. But as e-commerce becomes more prevalent across multiple industries, Donaldson decided a new global e-commerce platform was a priority. “We like to lead in our industry, and we had customers asking for a better e-commerce experience,” says Donaldson marketing manager Rod Radosevich.

Three years ago, Donaldson made a strategic investment in a new enterprise resource planning system from Oracle. At the time, the company needed a better way to integrate a series of separate backend financial, supply chain, product and customer relationship management systems tied to a 20-year-old ERP system and better serve its more than 2,000 global customers.

As soon as the new ERP system was installed in 2016, the next 15 months were spent building a new global e-commerce system. After a another year of piloting and building out the features and functions customers told Donaldson they wanted, the updated e-commerce system went live in September.

The new e-commerce system includes a number of new features—and supports 10 different languages and more than 15 currencies, the company says.

The updated e-commerce site, Shop.Donaldson.com, also features faster and better search that gives distributors and other customers the ability to search by part, multiple parts, reference number and product description among other attributes. New order management tools also let users more easily manage their account by faster access to current and past orders, shipments, payment methods, invoices, recurring orders and saved lists. “Quick access was a big priority for users,” Duhart says.

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An updated checkout process features faster navigation and fewer steps for customers to complete recurring orders, order in bulk, apply pricing discounts and ship to multiple locations.

Donaldson carries an extensive inventory of about 25,000 products online. A key benefit of the new e-commerce system is the ability to make universal changes across the platform or in different languages and currencies much quicker.

Donaldson is a big company with 2017 annual sales of $2.73 billion. Today, e-commerce is a small portion of total sales. Last year, Donaldson says sales transacted through the website topped $100 million. That suggests that e-commerce represents about 4% of total revenue.

But Donaldson is committed to having more customers go online. “Our customer transition to the new platform is well underway and to date we have recorded $45 million in revenue from 750 customers in 76 countries,” Donaldson CEO Tod Carpenter told analysts on the company’s third-quarter earnings call, based on a transcript from SeekingAlpha.com. “We are pleased with the progress so far and expect the full rollout later this year.”

The company also is ramping up its new e-commerce system to process a lot more web orders.  “We anticipate more than 10,000 orders per month—a number which we expect to grow over time,” Duhart says.

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