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How a Rapidly Growing Omni-Channel Brand is Rethinking Global Commerce Operations

We had the great pleasure to chat with Elia Fornari, VP Operations at Brain Dead about their brand story, the vision, and the way they are dealing with rapid international expansion.

Brain Dead is a creative collective of artists and designers from around the world. With its disruptive, graphic-led approach, the brand takes its cues from post punk, underground comics, skateboarding, and the spirit of subculture as a whole. Brain Dead is not one person, nor is it one idea. It sits in the space between people.

History of Brain Dead

Brain Dead started from a single idea: how can we share the spirit of subculture with more people? Started by Kyle and his girlfriend in 2016, the brand initially struggled to find its niche, simply printing custom t-shirts. Later on, Kyle brought Elia on board to systemize a lot of the processes and grow the company.

Elia was attracted to the company for several reasons - the grandness of the company's vision, and the ability to provide meaningful economic opportunity to artists around the world, and the ability to delight customers and spark joy in lives by showing them something they've never considered before.

Currently with 18 employees, Brain Dead has now expanded sales worldwide, with standalone stores in 2 countries, and a presence in several Dover St. Markets around the world, and several other planned storefronts.

Spreading Joy through Subculture

Brain Dead is not only an apparel and accessories business, but also collaborates with creative talent across a diverse range of industries. For example, they recently hired a music director to manage all their music productions. In addition, they recently opened a cinema at the old Silent Movie Theatre just off Melrose, Los Angeles. Brain Dead and Illumination Studios (creator of the minions) are partnering to create a new cinematic experience and a corresponding product line.

Creativity and inspiration comes from combining unexpected elements in unexpected ways. Brain Dead has a huge competitive advantage in its strong partnerships with forward-thinking artists and creatives from around the world. These collaborations translate into one-of-a kind products and experiences, which serve to introduce consumers to subculture, spark their creativity, and bring them happiness.

E-commerce Boom and Current Challenges

As with many omni-channel retailers, Brain Dead leaned heavily on its DTC business, and today their e-commerce revenue makes up over half their total revenue. Although e-commerce has dramatically increased merchants' brand reach, total addressable market and ultimately net sales - one challenge is how to effectively serve all those far-flung customers. Everything from customer support, to marketing, to fulfillment and logistics needs to be localized to delight customers.

Supply Chain

The most difficult issue as a small, rapidly growing merchant might be dealing with a global supply chain. Even though in recent years, numerous companies have sprung up to provide ecommerce-oriented logistics services, there are still a lot of gaps when looking for a comprehensive, environmentally friendly, global logistics and distribution solution. It's very difficult for a small company to match its warehouses and distribution capacity with consumer demand, which causes inefficiencies in order routing.

For example, Brain Dead partners with artisanal designers from around the world to create the most unique and special pieces for their customers. These designs are then sent to specific manufacturers based on their specialization. Italian manufacturers produce shirting, Vietnamese produces shoes, Japanese produce homegoods such as rugs, and US produces workwear. However, Brain Dead only has a single distribution center, in LA. That means regardless of where a customer is located, their products are shipped from LA.

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One consequence is customers end up incurring import/export tariffs multiple times. When a Japanese customer places an order for a rug from wearebraindead.com, that rug is manufactured in Japan, then shipped to LA, and taxed when it enters the US. Next, that rug is sorted and processed at the LA distribution center, after which it is shipped back to Japan, where it is taxed again. So a rug with $30 of production and material costs end up costing $75 or more after a set of round trip tariffs. Furthermore, the shipping the rug twice around the world causes a lot of greenhouse gas emissions and is not very environmentally friendly.

A Brain Dead Simple Solution

Of course, large companies solve this by having many distribution centers in countries all around the world, centrally managed with complex supply chain software. Brain Dead also plans to open distribution centers in the Eurozone and Japan in the near future. But how can a small, dynamic player without access to the same level of sophisticated IT systems pull together such a solution? Brain Dead still doesn't use a centralized inventory management system, nor ERP, and has very few formal IT systems in its supply chain.

The solution here is to create multiple SKUs on the website for each product, such that each SKU corresponds to a product in a particular warehouse. When a customer signs on to the site, the site dynamically displays only those products that are available in the local warehouse. This way, the customer is guaranteed to only purchase products that can be shipped locally, saving money and protecting the environment.

E-commerce has opened the door for creative people all around the world to share their ideas, connect with and earn make money from their talents. By intelligently balancing demand and local supply, Brain Dead is able to distribute the products efficiently so that consumers are not only delighted, but also minimize the environmental impact - a no brainer.

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