A lot of awesome things have been going on at Bitcraze during the last couple of months (like TDoA3, Swarm shows and a new front page), but on the logistics side we’ve been struggling. Like we wrote a couple of weeks ago we’ve been having huge issues with out 3rd party warehouse supplier. Unfortunately the issues have continued and we’ve been working hard on patching things together to get orders to our customers as soon as possible, but it’s not a sustainable situation and some of our customers have unfortunately had to wait too long for their orders to arrive.

So a couple of weeks ago we took the decision to move handling of the E-store from the 3rd party in Hong Kong to our office in Sweden. This will initially mean more work for us, but we feel that it’s something we need to do in order to keep the level of service we want to give our customers. So for the time being orders will be shipped from our office in Sweden.

So what does this mean in practice? Except for things hopefully working much more smoothly there won’t be any noticeable change for non-EU customers. However for EU customers there’s a big improvement: previously our EU customers had to import the products into the EU where the orders where subject to VAT and import duties. With the E-store moved to Sweden these orders are now subject to Swedish VAT (25%) directly on the order and customers will not have to import the goods so no additional VAT or duties are added upon receiving the order. Since this makes things easier and faster for our EU customers we’re really happy about this. Note that for customers with valid EU VAT numbers the VAT can be deducted directly in the E-store, you can either enter your VAT number directly in the cart or in your account if you have created one.

We’re doing our best to sort out the new situation and if there’s any issues along the way please let us know so we can work on fixing them.

Something we seldom write about on the blog is production and supply chain. It’s a big part of what we do, both in time and business wise. Even though we spend most of our time on firmware/software we’re actually only selling hardware. So this blog-post is about how we’ve set this up and the problems we’ve been facing the last month due to our 3rd party warehouse moving to a new location.

The current set-up

Currently we’re using Seeedstudio for our manufacturing. They do varying batch sizes, but most of the batches we produce are between 300 and 2000 units. We’ve been experimenting a bit with varying size of batches, too large and you tie up too much funds in stock while with smaller batches you spend most of you’re time tending to manufacturing. Another issue with large batches are things like battery shelve life and changing market (i.e suddenly some parts are EOL or have been replaced when it’s time for the next batch).  Finding a good level for different products depending on production cost, complexity and shelf-life is tricky.

After production the goods are moved to a number of warehouses. Part of the goods are warehoused at Seeedstudio, part of them are sent to our 3rd party warehouse in Hong Kong serviced by Shipwire and a small amount is sent to our office for testing/development/customers. The products in Seeedstudio’s warehouses services a number of distributors though their wholesale channels as well as end-users though their Bazaar. We service our E-store though Shipwire in Hong Kong and a few customer though our Swedish office.

Scaling up

Since the end of last year we’ve seen an increase of sales, which we are of course really happy about! More sales will mean more resources for development which translates into more awesome products and features for everyone. The problem is that it takes time to scale up the supply chain on the back. Today we have have 27 SKUs and 7 bundle SKUs “virtually” made out of combining products into bundles. Out the 27 SKUs we control the manufacturing of 17 SKUs (like PCBs and plastic parts) and 5 SKUs are things we buy (like the USB-cable). Typically the lead time for simpler products is 1 month and more complex products 2 months, with an additional lead-time of at least a week to reach our Hong Kong warehouse and become available in the E-store. Creating bundles by “virtually” tying together a number of products is great since it gives us more flexibility but if one of the bundled SKUs is out of stock the bundle will also be our of stock.

Controlling this complex situation while scaling up for larger sales has proved challenging, also when everything works as expected (see below). Most of our customers have gotten their things in time, but we’ve had to put a lot of hours into juggling products around between warehouses to make it happen.

Warehouse issues

Back in February we were notified by Shipwire that they would be moving the operation to a new warehouse in Shenzhen/Hong Kong. The timeline that was communicated was that the inventory would be offline 3rd – 6th of April. This might seem optimistic for a warehouse that is  about 10 000 m2, but since they have a large amount of warehouses around the globe we assumed they would pull this off. Unfortunately this wasn’t the case, a number of factors played in to delay the move. Since the first week of delays the expected timeline has been “next week”, which unfortunately hasn’t held. Finally we’re at a point where our old inventory has been moved into the new warehouse and is available. The next problem we’re facing is getting our incoming goods into the inventory, which is currently expected to be finished by the end of this week. To say the least we’re unhappy about this situation, but unfortunately we have had very little control. We don’t have a large number of products available in any other warehouse so we haven’t been able to “switch over” to another solution. We’ve done our best to keep the effected customers updated on the situation and calling support every day to get an update.

Moving forward

We’re a small team of 5 people and we’ve always been most focused on product development. It’s what we like to do and it’s what we’re best at. So an easy way forward would be to pay someone else to handle all of the above. Unfortunately this has proven to be tricky for us. Basically handing over everything that generates revenue for our company to someone else is a huge risk, to say the least. So we’ve realized that this has to be a central part of what we do, just like development. This was the main reason for starting our own E-store last year and it’s something we’re continuously working on improving.

Moving forward the overall goal is to minimize the work spent on production and stock management while making sure to not run out of stock or tie up all our funds in stock. We think that one key to this is being proactive instead of reactive. So we have integrated this into our daily work just as much as development. Next to the “development” board with stories/tasks we have an even bigger kanban board with production/logistics/warehouses and it’s something that is constantly part of the planning/status meetings. We’ve also been gearing up for producing batches of popular products more often and increasing the batch sizes to meet the increased demand and to lower the risk of being out of stock. The last part is an internal system we’ve been developing during the last couple of years that keeps track of stock, production, customer shipments and stats in general. More on this in a future blog-post!

Last week while Kristoffer and Arnaud was in Singapore showcasing our Loco positioning system and Crazyflie at ICRA we initiated moving to a new bigger room here at The Ground. The Ground is a great business collective hosting offices for companies such as Mapilary, Monix, Castle to name a few. It is a very inspirational place to be with a great sharing climate which helps a lot for startups and early phase companies and we are happy to be part of it.

One of the nice things with the new office is that we now can have a dedicated flying area close buy and don’t have to run up and down the basement all the time. Hopefully this will help us speed up development and testing a bit, benefiting not just us, but the whole community :-).

So next time you get an email or forum post written from us you know where it is likely to have been typed.

It is summer time and the tempo in the office is a somewhat slow as most of the Bitcrazers are on vacation recharging their batteries for future awesomeness. This weeks blog post will not contain any cool tech stuff but instead I will tell you a bit about how we work. This is a moving target as we are continuously changing and improving, but I can share a snapshot of how it works right now.

Basics

We have two basic principles that all our work is based on: self organization and continuous improvement.

Our take on self organization can be boiled down to the simple idea that no one in the company can decide what someone else must do. That is right, no one (or every one) is a boss! The result is that we have to find solutions that everyone can accept, this in turn requires complete trust and respect within the company.

Continuous improvement means that we try to become better at what we do. If we fail we try to understand why and find a better way next time. If we succeed we enjoy the success and then we try to understand why we were successful and find an even better way. The key ingredient is feedback, based on (again) respect and trust.

How we do it

Planning can be a useful tool but it can also be expensive when overused. Plans give a shared direction but the cost is that they take time to maintain, they tend to reduce agility and most likely they will be more or less wrong. We try to balance this by planning as little as possible and making long term plans less detailed. We consider planing to be a an opportunity for discussions and the actual plan as a documentation of the discussion. The discussion is more important than the plan it self.

Our long term direction is set by our purpose – the reason we go to work and invest all these hours into this project. We have tried to form one single sentence that captures this and the latest version is “Together we innovate and explore robotics”. The sentence it self is not that important but the discussions leading up to the sentence is what matters.

From the purpose we have tried to create a one year plan and a three year plan based on what we all would like to achieve in the coming years. This is very much a wish list, pretty vague. Every quarter we create a quarterly plan based on the one year plan. This is a list of areas we think are important to work with in the coming tree months, it usually does not contain very specific goals but gives us a good idea of what to do.

Björn at the whiteboard writing fake sticky note and looking busy

We kick off every week with a feedback and planing meeting. We look back at the previous week and investigate what we did, why we did it, the outcome and what we felt. When we have agreed on the past we turn to the future and decide what we think are the most important things to work on in the coming week. We also decide on a few experiments that we want to try out that we think will improve the way we work and increase our happiness.

We start every day with a short standup meeting to synchronise the team, understand how we can help each other and make sure we are doing the right thing.

The rest is just hard work :-)

Some inspiration

More about self organization. and what is motivating us?

Going out of the norm for this week, this blog post is about my experience as an intern at Bitcraze. My name is Aman and I joined Bitcraze 8 weeks ago hoping to gain more experience and knowledge in quadcopter robotics while building some new connections.

Working at Bitcraze has been a breath of fresh air compared to all my previous internship experiences. From the work environment to the five brilliant guys that run this company, I believe everything was setup for me to have one of the best internship experiences. Someone was always available to help me with any concept I did not understand and even though I was just an intern, each of the guys made sure to include me in every part of the planning process. This type of inclusion, I believe, allowed me to see my role in the company and how I contributed to the overall goals.

While here, I mainly focused my work on the flight control software behind the Crazyflie. This included learning and understanding the framework behind the crazyflie, tweaking the existing firmware code to get location data, converting MATLAB code to Python that would provide location of all the anchors in a Loco Positioning setup by simply moving the crazyflie around, designing a filter that would provide more stability during flight operations during ‘Fun Fridays’ (definitely a great idea), etc. Also, with Arnaud’s help, I was able to learn how to juggle while I taught him how good peanut butter goes with bananas.

In my opinion, the reason for Bitcraze’s success and the reason it is such an amazing place to work is because of the way the company is setup. They follow a company structure called ‘self organizing’. Having never heard of it before or experienced it before, I was a bit thrown off when I first started working in this environment. Here at Bitcraze, there is no heirarchy, but, instead everyone is a leader of their own individual roles, a concept I believe allows them to solve even the most difficult of problems with ease. Once I acclimated to this, working for Bitcraze tenfolded in awesomeness. The only downside, though, you will never want to work anywhere else again.

During my experience here, I have gained a plethora of skills and have had many great experiences. Most importantly, however, I have built great relationships and learned that where you work and who you work with is just if not more important than what you work on.

PS: They love visitors here, so feel free to come and hangout with the guys!

–  Aman

Thanks!

We have enjoyed your internship a lot! You quickly adapted to our crazy way of working and became a natural member of the team, adding not only your technical skills but also your personality and new angles on what we do.

We hope we will see more of you in the future!

–  The rest of the Bitcraze team