Amendment_No_1_FINAL.pdf

Smithsonian Institution RFP RN11SOL0032

Retail Stores Distribution & Catalog/Web Fulfillment RFP Amendment No. 1

SMITHSOIAN INSTITUTION

Retail Stores Distribution & Catalog/Web Fulfillment Services

Request for Proposals

#RN11SOL0032

AMENDMENT NO. 1

Dated: December 12, 2011

Via e-mail delivery

A. The due date for the submission of proposals is hereby changed from December 16, 2011 to

Wednesday, December 28, 2011, 2PM Washington, DC local time.

B. The RFP is hereby amended to include the following questions and answers:

1. Question: the RFP mentions that contractors would be required to pay prevailing wage rates in accordance with the Service Contract Act. What wage rates apply? Smithsonian Response: To the extent the Service Contract

Act is applicable to an Offeror’s proposal, Offerors should refer to www.dol.gov , the occupations listed in the wage rates for the location in which the employees would be performing the work or providing the services, would apply.

Wage determinations can be located at http://www.wdol.gov/sca.aspx .

2. Question: Page 30, B. 1. d. – on the subject of data conversion, please define “history”. Specifically, can you give us an idea of how many months of history we are to convert and maintain? Smithsonian Response: 24 months of complete customer order history will be converted and maintained. Customer files and inventory file are converted and maintained on ongoing basis.

3. Question: Page 20, E. 1. g. 1. – you request annual audited financial statements. Our annual statements are

“reviewed” not audited. Is this satisfactory? Smithsonian Response: The differences between “reviewed financial statements” and “audited financial statements” will have to be defined by the individual Offeror. The Smithsonian suggests that Offerors provide a description of their current process and identify the additional cost, if any, for

“audited financial statements” in the event the “reviewed financial statement” criteria does not meet Smithsonian requirements.

4. Question: Page 20, E. 1. g. 2. – you specify that we need to be prepared to provide a SAS 70 Type 2 completed form. We have attached a statement from our CFO which explains the fact that we do not have a current

SAS 70 audit. We have however, complied with PCI requirements which are a much higher standard. Is this satisfactory? Smithsonian Response: The requirement as stated in the RFP is requested. However, Offerors are if free to address the requirement with a financially supportable alternative.

5. Question: Page 40, Appendix A, Indemnification/Hold Harmless verbiage. Can this be mutual?

Smithsonian Response: It can be but any indemnification that the Smithsonian would be authorized to make would in all cases be subject to the extent permitted by law.

6. Question: Retail inbound and outbound activity qty is described in "cases" and "units". Are the unit qtys in addition to the case qtys, or are the unit qtys just a conversion from the case qtys into units? Smithsonian Response:

Both numbers are provided for the benefit of Offerors. They are not exclusive of one another.

7. Question: On page 14 of the RFP pdf, order information in units, lines, and packages is given for the

Catalog/Web business. Is this same information available for the retail business? Smithsonian Response: Units and carton shipped from the DC to the retail stores is provided in C.1.d.4 and C.1d.5. Lines and units per line information is not available.

8. Question: In looking at the volume of stores vs. e-commerce it seems to make sense that being in the

Maryland or NE Virginia area for a DC makes sense. We will need to lease a building specifically for Smithsonian's http://www.dol.gov/ http://www.wdol.gov/sca.aspx business. Will Smithsonian Institute [sic] hold the lease? Smithsonian Response: The Smithsonian is interested in getting the best overall deal for purposes of meeting its objectives as stated in the RFP. Without seeing more of a total offering in which this course of action might be proposed, at this time, the Offeror (not the Smithsonian

Institution) would be the one entering into the lease for purposes of providing the offered services.

9. Question: Can we provide a call center company and forward the RFP to them? We do not exclusively partner with them but would like to provide a full store, e-commerce AND customer care center solution.

Smithsonian Response. All contracts that would be made based on this RFP would be with a successful Offeror who proposes on the services requested. So to answer this particular question, the call center vendor would have to submit its own proposal for the call center services.

10. Question: May we have % of shipments by State for the e-commerce portion of shipments. Smithsonian

Response. We will not provide this information as we feel that it is not relevant to Offerors’ ability to propose.

11. Question: Page 6-C 1. a. (1) -how many ship to's are represented in the 15 stores. For example, the two stores in the Airport, do they ship to two different addresses Smithsonian Response. Currently, all deliveries made to a single destination. Multiple stores in one museum/ building receive a single combined delivery.

12. Question: Page 6-C 1. a.(3) - when museums have several store locations are they treated as separate stores, so they have different ship to's and are part of the 12 museum store count? Smithsonian Response. Currently stores are treated as separate stores internally and systemically. They are not treated separately for delivery purposes.

There is one delivery address for each museum/building.

13. Question: What is the current SF utilized for the e-commerce business. Smithsonian Response: There is no separation between the e-commerce business and the catalog business. The fulfillment for that business is housed in a shared environment. The storage space is variable based on seasonal needs. The receiving, QC, packing and shipping areas are shared with other clients of the fulfillment provider.

14. Question: Page 6-C 1.b.3 - Are these considered the crossdock cases? Smithsonian Response: No, these are not specifically crossdock cases. 80% of the receipts are designated to ship to the stores. 20% of the receipts are stocked in the warehouse.

15. Question: Page 6-C 1.b.4 -Do we ticket the other 40%? If so, are the tickets sent to us or do we have to print them on site? Smithsonian Response: Yes, the bulk of the receipts not tagged by the vendors are tagged at the warehouse. The tags are printed on site at the warehouse.

16. Question: Page 8 - how much space is needed for temp control items? Smithsonian Response: Currently none. Seasonally, one or two products may be subject to high heat concerns. No refrigeration is required for any

SE products.

17. Question: Page 8 - how much space/bins for secured jewelry cage? Smithsonian Response: All jewelry is in a secure jewelry cage. Space required for the cage depends on the processes that occur within the cage. Space required for the picking and area is approximately 400 sq ft. Bins range 400-500.

18. Question: Page 8 - for the jewelry cage, what level of security is needed? Smithsonian Response: Jewelry value ranges from $30 to $3800. A locked cage with controlled access would be needed for most pieces. Additional security within the cage would be required for the very few very expensive pieces of jewelry sold by SE.

19. Question: Page 8 - how much space is needed for the store displays and fixtures? Smithsonian Response:

The space requirement fluctuates but storage for fixtures and misc stores storage is approximately 3000 sq ft. at a minimum.

20. Question: Page 9 - 6) how many inventory transfers would be eliminated with both operations under one roof? Smithsonian Response: Assuming we are interpreting the question correctly, with both operations under one roof all inventory transfers between warehouses would be eliminated.

21. Question: will inventory still be separate and "owned by either retail and catalog/ecommerce or will it be joint inventory. Smithsonian Response: Yes, the inventory will be “owned” separately by SE retail stores or SE catalog. It will be allocated at the point of receiving. However, inventory transfer will occur between the two.

22. Question: will invoices for services be separate? Smithsonian Response: The proposed method for invoicing is stated in the RFP. If the fulfillment and distribution operations are combined under one roof, some of the services would be for both catalog and retail stores, making separate invoicing difficult. As stated in the RFP, Offerors are welcome to propose an alternative method. However, Offerors will still need to respond to the RFP with the SI proposed method.

23. Question: Page 10 - Are all items scannable with a vendor printed barcode? Smithsonian Response: No.

24. Question: Page 10 - is RF currently used in both DC‟s [sic]? Smithsonian Response: RF is used in both

DCs for a variety of functions.

25. Question: Page 13 - what is the percentage of international orders? Smithsonian Response: 4% of the shipped sales for FY 2011 (Oct 1, 2010 – Sept 30, 2011) were considered international or outside of the 50 United

States.

26. Question: Page 15 - k.1. - is the note card preprinted at the gifting station? Smithsonian Response:

Currently they are hand-written. However, SI would have no problem if Offerors wanted to print them at the gifting station.

27. Question: Total current # of SKU(s) and/or Titles: 13,300 (total); Average # of orders per/month:

16,693.00 (combined); Average # of items sold per/month: 35,300 (individual items); Average # of full cases sold per/month: 8,719 (assuming that there is approximately 50 items per/case) [please also address the following:]

(a) Average # of full pallets sold per/month: Smithsonian Response: N/A

(b) Average # of cartons received per/month: Smithsonian Response: Stated in RFP

(c) # of pallets at initial move in: Smithsonian Response: 48,000 sq ft (additional 100,000 – 200,000 units) comprises about 450 pallets.

28. Question: [regarding] SKU(s): (a) Pg 8 (6-7) Verify that the 56,000 SKU(s) mentioned are not for sale & there is no inventory needed. Smithsonian Response: Of the 56,000 SKU(s) mentioned on page 10, only 12,000 were active and had on hand in FY 2011. (b) 700 pick locations that are part of the replenishment inventory, please define, (are these new products released) what does the additional 300 pallets (replenishment)? Smithsonian

Response: Pick locations are part of the replenishment inventory. Reserve stock is maintained in the warehouse for on demand replenishment. 300 pallet positions represent bulk inventory and store supplies. (c) In regards to the previous question, if the three hundred (300) pallets is not replenishment, how many full pallets are received monthly? Smithsonian Response: Answered above. For the exception of only a few items, large inventory levels are not maintained in the warehouse. Full pallets received per month are not reflective on the storage requirements.

Most inventory is received and sent on to the retail stores. (d) In reference to total storage, how many total pallets are needed for both categories? Smithsonian Response: The question is not clear. 300 pallet positions are currently used for storage. (e) Pg 14 and 16, There is an inaccuracy in the current active SKU count, please clarify.

Smithsonian Response: 12,000 SKUs on file in the system, approximately 1,400 are currently active.

29. Question: CALL CENTER QUESTIONS: Note that Smithsonian responses are in denoted in the Monthly columns and are in red italics.

Description Monthly Description Monthly

Calls: Orders/Invoices:

Number of Order Calls

Calls received by month are on page 11 of RFP. Conversion by month varies. Number of Invoices mailed We are B-C

Approximately 62% of calls result in an order Oct/Nov. 55% in

December/January. Varies by mailing schedule.

Number of Info Calls

Info call and customer service call – opposite % to order calls. Number of EDI orders We are B-C

Average Minutes per call (PG 11) 4min 36 sec

Abandonment Rate Less than 3% Misc:

E-Mail correspondence

Volume (how many customer email are received monthly)

An average of

700 e-mail responses per month were generated by the customer care center in FY

Statements: Hours of operation 24X7

Number of statements mailed ZERO Number of seats in call center

Shared

Environment

Peak Hours of service

Mid Day and early evening depending on season.

Will Live Chat capability be a

24/7 requirement NO

Returns:

Number of credit memos generated 200/year Credit & Collection:

Number of collection calls made ZERO

Average minutes per call N/A

Number of collection letters generated ZERO

Number of credit checks done Unknown.

30. Question: Is web chat support desired? Smithsonian Response: No, not at this time. We would not rule it out as a future desire.

31. Question: Are email templates provided for standard responses? Smithsonian Response: If not available, we will work with the fulfillment provider to develop appropriate templates for e-mail responses.

32. Question: What would cause large call volume swings from one month to the next? For a month as compared to the same month in the previous year? Smithsonian Response: The large variance in volume from one month to the next or one year to the next was the result of not mailing books. A strategy to mail fewer books and shift more business to the web was not successful. The catalog has returned to a regular mailing schedule for 2012 with plans to expand the mailings schedule.

33. Question: Are the catalogs mailed by the current Fulfillment provider for Catalog/Web? Is this something we should bid on? Smithsonian Response: The major mailer occurs from the printing facilities. Catalog requests are taken on the phones and via the web. Many of these are mailed directly from the fulfillment house depending on catalog availability and the catalog drop schedule. Offerors can use 10,000 as a base estimate.

34. Question: Freight – will the provider be 3 rd party billing back to Smithsonian, or will Smithsonian require the use of its shipping accounts? Smithsonian Response: Smithsonian will use both the providers shipping account and Smithsonian accounts depending on the most favorable rates. W currently use three different primary shipping accounts, two of which are Smithsonian accounts.

35. Question: Is there a local bias for the Retail Store Distribution? (ie, we can propose the use of a local facility if needed) Smithsonian Response: The location of the facility is not mandated in the RFP. However, deliveries must be made to the museum stores Monday thru Friday according the museum delivery schedule, which is generally a morning delivery. On rare occasion, a second shipment may be required on the same day.

Proposing the use of a local facility is completely acceptable.

36. Question: Is it possible to estimate the number of Internal SE Catalog users for system access?

Smithsonian Response: The users requiring accounts may be as high as 40 with most acting as an occasional user.

Regular/concurrent users tend to fall between 10-15.

37. Question: [call center] Does the Call Center currently have 24/7 hours of operation? We assume this as a requirement for the proposal. Smithsonian Response: Yes, the Call Center currently operates 24 hours/7 days a week, and this is a requirement under the RFP.

38. Question: [call center] Do you have Volume by Coverage Hours available or by Day during the months of

October-January? Smithsonian Response: No. Monthly call activity information is provided in the RFP.

39. Question: [call center] We typically double the number of calls to reflect required functions related to email/fax/mail correspondence…is this a good assumption? Smithsonian Response: Our order to call ratio has been

62% for October and November 2011. For the past December and January, the order to call ration was about

55%. This rest of 2010 was not a good representation of call center activity because of the limited books in the mail. We can’t accurately reply to your assumption because every call center operates differently. Hopefully the numbers we are able to provide will help.

40. Question: What standard reporting is required at the retail unit level (stores, kiosks, mobile carts/tents)?

Smithsonian Response: Standard reporting at the retail level is provided through SE owned IPMS. It is not a

Distribution Center responsibility. See also the response for question #48.

41. Question: Will the vendor that is awarded the contract be responsible for printing the catalogs as well as the fulfillment? Smithsonian Response: No, printing catalogs is not a requirement under this RFP.

42. Question: What is your expectation for how training of SE personnel will be handled? Smithsonian

Response: Smithsonian Response: In-person systems training will be provided on site at the SE facility and training materials will be provided. The level of training required will depend on the complexity of the system. The current staff is computer/software literate. Manuals for the functionality of the computer systems will be available in soft copy for internal SE sharing, including a list of canned reports with examples and input requirements.

43. Question: On returns/refunds for orders that have been paid with both a gift certificate and credit card, how does the current system handle 'paying' the refund? Smithsonian Response: Refunds are generated based on the original payment method(s).

44. Question: On page 17, there are numerous references to “total access to the computer systems”. (a) Are there different levels of access within each group or will all users within a group have the same access? Smithsonian

Response: There are different levels of access and controls suggested/required within SE. If possible, different levels within the same group may be needed depending on system functionality. (b) Are the functions to be performed specific to these groups or will the functions be shared between groups and/or shared between the groups and [successful offeror‟s] personnel? Smithsonian Response: Depending on the function, access may be required by more than one group. It would be assume that the host provider will have access to anything available to SE. (c) Is there an overlap in the functions performed? Smithsonian Response: Depending on the functionality of the system and access points, there may be overlap in function. Inventory files would be the most shared across groups. (d) If so, is there an additional level of security and tracking required? Smithsonian Response: Yes and Yes. Security tracking would be a plus. Once the systems and functions are defined, security levels and required tracking will be more easily defined. (e) As part of the 'total system access' requirement, is ad hoc reporting a requirement for everyone? Smithsonian Response: No, ad hoc reporting would not be required for everyone. (f) Are there also predefined report formats that you can share with us? Smithsonian Response: It is or goal to review the available reports and evaluate the additional needs beyond that. Many of the current internal report are created from exported files.

45. Question: How many drop ship vendors do you have? Smithsonian Response: 15- 20 Describe the drop ship process you expect to be performed. Smithsonian Response: Orders are accepted via all channels, customer orders are sent to the drop ship vendor as received, the fulfillment company is notified and the customer is billed for the shipment. Invoicing from the vendors is sent to SE. Are order file feeds sent automatically, both to and from the vendor? Smithsonian Response: No. Orders are currently sent to and from vendors via e-mail or fax. This can be changed.

46. Question: Are any SKUs lot controlled? Smithsonian Response: We are not familiar with the term “lot controlled”. SKUs are currently created by the buying staff who generally use a range of SKUs (just the first character) to identify broad categories of products (jewelry, apparel, etc.). Certain item numbers are SKU’ed by size-sm, md, lg, xl. Others are SKU’ed by grouping- necklace, earrings, bracelet, ring.

47. Question: What is your GL structure? Smithsonian Response: Accounting Units are either 5 or 6 digits

(example: 016010) Account 5 digits (example: 59610).

48. Question: Is Financial reporting required at the store level or some other level? How are GL accounts assigned to transactions at that level? Smithsonian Response: Minimum requirements are store reporting and inventory by museum as reported internally by SE through IPMS .This information is not provided by the distribution center. GL accounts are assigned to track warehouse activities (i.e. damages, MOS, Returns, discrepancies, inventory on hand value, etc).

49. Question: Can an IPMS integration document be provided to help define the integration requirements?

Smithsonian Response: Documents will be available, but not at this time.

50. Question: On page 12, the RFP states that "customer services is responsible for check and credit card verification, address verification, and in-house fraud programs". Is address verification and fraud-checking currently performed through the web site for all orders entered via smithsonianstore.com, or is there a separate verification and fraud-checking step that must be performed when orders are received for fulfillment? Smithsonian Response:

Credit card and address verification is performed through the web site. We also select certain web orders by value and order make-up that we currently place in a hold bucket for further verification by SE personnel. The level of attempted fraud can be significant during certain periods of the year and this step reduces the losses. Higher level fraud checks are performed on select orders (phone and web) by SE personnel.

51. Question: Does the contact center currently enter orders through smithsonianstore.com on behalf of customers calling into the customer service line, or will the new contact center need to provide a separate order entry/customer service system? Smithsonian Response: The contact center enters order into the catalog management system currently in use (SIGMA). The new call center will need to have the capability to enter orders into the same type of system or a system that interfaces with the main catalog management system.

52. Question: For reduced PCI risk, has Smithsonian considered keeping all credit card processing on a single system, rather than pre-approving on the web and passing credit card data to fulfillment for processing? Smithsonian

Response: The Smithsonian will consider recommendations that reduce risk. Current providers are PCI compliant and any new providers would also need to be PCI compliant as stated in the RFP.

53. Question: Page 16 states: Sigma Controller contains "SE's customer database, all inventory transactions and movements, purchasing, marketing, order entry, warehouse management, and all customer transactions". Does SE anticipate that the new vendor will replace Sigma Controller with their own system that handles the same functions?

If yes, please provide integration documentation for Smithsonianstore.com and Lawson software. Smithsonian

Response: SE does anticipate that a new vendor will have their own system and the resources to interact with the current systems owned/used by the Smithsonian. SIGMA does not actually integrate with Lawson or information provided to Lawson from an extract. Since a third party provider is currently used for the web site, integration documentation will be provided at a later date.

54. Question: Page 22 states that IP DIRECT software is an option. Can SE provide more information, such as vendor name? Smithsonian Response: No. The Smithsonian mentions the IP DIRECT software as one option because it is known to directly integrate with IPMS. There may be other systems that offer similar capability.

Island Pacific.

55. Question: Page 6 C. Current Operational Scope & Volumes. Can an average “orders Shipped Report” showing number of orders shipped by the day of the week be provided? Smithsonian Response: The breakdown by day, is too voluminous to provide and would not be useful for purposes of proposing under the RFP because it doesn’t tell the full story.

56. Question: Page 6, C., 1, a., 2) The actual number of retail units varies and may include stores, kiosks, and mobile carts/tents. Are items/orders destined for kiosks and mobile carts/tents generally distributed to a fixed base store before further distribution? Smithsonian Response: All orders are sent to a single fixed base store and distributed from there.

57. Question: Page 8, d., 2) Inventory is picked from warehouse stock based on automatic store replenishment and Retail Store delivery schedules. It is also picked based on transfer requests by buyers for the

Retail Stores? Smithsonian Response: 70% of all picks are from basic stock replenishment.

58. Question: How are transfer requests presently entered for retail store requests? Smithsonian Response:

Transfer requests are currently entered directly into the IPMS system by our buyers and communicated to our stores and our warehouse electronically.

59. Question: How many buyers will be expected to have access to this method/system? Smithsonian

Response: All of our buyers, planners, and buyer’s assistants will be expected to have access to transfer requests.

We currently have 19 users accessing transfer request.

60. Question: Page 9, 6) - RTV (Return-To-Vendor) units shipped from Retail Store Distribution

Center. RTV numbers include inventory transfers to Catalog Fulfillment Center. Can you provide the number of transfers to Catalog Fulfillment Center only? Smithsonian Response: 5-6 transfers have occurred in the past 12 months averaging 2 full pallets each.

61. Question: Page 9, e., 2) Shipments sent to many of the Retail Stores located within the museums, occur in enclosed delivery carts called “Tobys”. These containers are 6‟ high x 6‟ long x 4‟ deep. (a) Are the Tobys themselves actually stored at the Retail DC? Smithsonian Response: Most, yes. Full tobys are delivered to the stores and empty tobys are returned to the warehouse on subsequent shipments. (b) If so, are the Tobys pre-replenished with product before being shipped to destination store? Smithsonian Response: Yes, tobys along with pallets are used to send shipment to the stores. (c) What is the quantity of Toby‟s that will be stored in Warehouse facility? Smithsonian Response: SE owns 45-50 full size tobys and an additional 10-15 book tobys. Some tobys are always in transit but as many as 40-50 could be in the warehouse during slower months.

62. Question: Page 10, f., 1) Number of SKUs: Approximately 44,000 in system 12,000 with activity in FY2011. What is the SKU naming/category convention? Does each store have a separate item identifier logic or is it standardized across retail units? Smithsonian Response: SKU naming/category convention is standard across all retail units. That standardization does not include items currently processed in the current vendor’s software.

63. Question: Page 11, b. 1) The number of calls received per month. Can an “Interval Report” showing the average call per hour by day of the week S-S be provided? Smithsonian Response: For this information to be useful we would have to provide an entire year or two of data because the call volumes are so extreme from one season to the next. An enormous amount of hourly, daily, weekly and monthly data would have to be provided.

Along with that, mailing schedules and order forecast would be required as well as delivery results to explain the data. Then we’d have to explain the months were we mailed no catalogs. Considering our business for the past two years, this historical data would only cloud their analysis without one-on-one dialogue.

64. Question: Page 11, a., 8) The average number of units per order is 2.3. What are SE's partial shipment business rules for Catalog/Web orders? Smithsonian Response: We strive to minimize backorders, but do not hold shipments to ship complete.

65. Question: Page 12, c. General Question. Are all catalog/mail order response cards standard size and layout to be "transport ready," e.g., designed for automated sorting and data capture processing? Smithsonian Response:

No. The mail order response card or “order form” is a printed page in the catalog. The customer responds by tearing the page out of the catalog, completing it and mailing in with a check or credit card information. An envelope is not provided. The customer may elect to write out their order on a separate piece of paper.

66. Question: Page 12, d. General Question. If proposing a solution other than being the comprehensive software and service provider, how are web promotions expected to be coordinated and synchronized with call center operations? Smithsonian Response: Most promotions are source code or promo code driven and used in both systems. Some promotions are web only and some are phone only. Good communication between to SE and the successful offeror, is key.

67. Question: Page 13, f., 2) SE defined quality control is performed on all received merchandise. Is a summary copy of the SE QC policy available? Smithsonian Response: The SE quality policy is fairly basic and straight forward. We provide very detailed product sheets and product photos for all new products and they must match. A initial check (sampling) is made of the received products to see that it conforms with the specifications and packaging requirements of the product sheet. SE contact person is available to resolve issues. Jewelry is

QC’ed at 100%. Please see the attached Sample Product Information Sheet.

68. Question: Page 13, f., 6) Approximately 95% of receipts are pre-labeled with a SE item #.

Are these labels standard 128 UPC layouts? Smithsonian Response: The labels we ask our vendors to create are

UPC –A.

69. Question: Page 17, n., 6) Sigma Controller + interfaces with SmithsonianStore.com, providing real-time inventory and order status information. Is a common web service used for inventory and order status queries with this system? Smithsonian Response: Yes, web services is a process currently used for inventory and order status queries with this system.

70. Question: Page 17, o., 1) All Catalog marketing functions are performed by SE. SE‟s Marketing group requires total access to computer systems for input, retrieval, and reporting. SE‟s Marketing group manages all promotions, maintains source codes, and manages all mailings. In addition, extensive data selects are required of the catalog/Web Fulfillment operator with daily, weekly and or monthly transfers of data to and from other SE designated outside providers. Are these selects considered ad-hoc and what is the generally expected turnaround time for fulfilling ad-hoc select requests once criteria is finalized and confirmed? Smithsonian Response: The majority of the selects for outside providers are standard. A schedule is provided by the SE Marketing group for the dues dates of standard selects. Usually a few days to week will be given for non standard selects.

71 Question: Page 19, c., 4) Process items requiring additional quality control inspections within 48/72 hours of receipt. (a) Are customized QC procedures to be completed prior to signing for receipt of delivery? Smithsonian

Response: No, product QC is not to be performed before signing for receipt. A shipment with obvious damage needs to be addressed accordingly. (b) If not, and a deviation is discovered, what protocol is followed for accountability? Smithsonian Response: SE is to be contacted regarding any product that fails to meet the initial quality check and a determination will be made from there at SE’s discretion. SE makes contact with vendors on quality issues and directs the fulfillment company on the handling of the product.

72. Question: Page 20, g, 1) - Provide inventory costs on method designated by SE – average cost, FIFO, etc.

Is it correct that only one of these methods designed by SE will be required and not a variation of methods by museum or product line? Smithsonian Response: Yes, this is correct.

73. Question: Page 24, b., 1), 7th bullet down - Capability to hold orders, based on predetermined criteria, for customer service review before release to warehouse for pick/pack/ship. Any specific hold criteria expected in addition to customer financial, such as credit check? Smithsonian Response: Order hold can be requested by item number, dollar amount, ship via, etc., depending on system capabilities. SE has been very successful at minimizing fraudulent order by using hold buckets and performing order reviews.

74. Question: Page 24, b., 1), 14th bullet down - Ability to accommodate multiple promotion codes and source code. scenarios between front-end website and back-end system. Is this a per-order or per line-item requirements specifically, or just the ability to apply multiple promo/source codes across a day's activity in general? Smithsonian

Response: The ability to apply multiple promo/source codes across a day's activity in general. Obviously, the more capability the systems have, the more options available to SE for promotions.

75. Question: Page 24, b., 1), 16th bullet down - Ability to handle cross-platform gift certificates. Can you define "cross-platform," meaning is the platform the item groupings or the system(s) on which the order life cycle must be compatible? Smithsonian Response: SE sells gift certificate for the catalog and gift certificates for the web site. They are not interchangeable. Ideally, SE would like to use gift certificates across selling platforms.

76. Question: Page 25, b., 2) 1st bullet down - Single Platform for Retail, Wholesale and Cross Channel Data

Capture and Reporting. Consolidated Demand, Sales, Purchase Order Management, Inventory, Markup, Markdown and Gross Margin reporting down to the Item level. Would the gross margin calculation include the Retail/Catalog service provider‟s direct costs, or some formula provided by SE? Smithsonian Response: Fees charged by the service provider are not included in the gross margin calculation in this requirement. This is only referencing inventory.

77. Question: Page 25, b., 2) 3rd bullet down - Flexible Hierarchy to include Departments, Classifications, Vendor, Item, SKU as well as Attribute reporting which may be outside of the official Hierarchy that will allow us to plan, track and forecast performance Exhibits, Themes, Subthemes etc. Please elaborate on attributes considered

“…outside of the official hierarchy…” Smithsonian Response: Typical merchandising system platforms utilize merchandising hierarchy consisting of Major Categories, Departments, Classifications, Vendors, SKU, Size, Color.

In addition to the traditional hierarchy there are many other ways that the business needs to be planned and reported on. These other “attributes” allow the ability to track ACROSS the traditional hierarchy. They typically are not tied into the financial reporting systems. In SIGMA, we use the “Query Codes” today to track attributes

(markdown status, disposition, obsolete status, Theme etc.). In the newest release of Island Pacific, there is the ability to utilize over a hundred different attribute codes. Currently we use Theme, Subtheme, Exhibit, Country of

Origin etc.

78. Question: Page 25, b., 2) 9th bullet down - Ability to interactively plan assortments with functionality that allows rollups to the top level plan and ability to make changes that roll up or down based on changes. Please elaborate on the definition of “assortments,” e.g. build-to-order kits, pre-assembled kits, etc.? Please elaborate on the concept of “…ability to make changes that roll up or down based on changes. Smithsonian Response:

Assortments are really any combination of items that are being looked at as a group. Usually a subset of a department or class but can be across departments or classes. It has nothing to do with sets/components although that is another requirement we have in our merchandising system needs --but has nothing to do with Assortments.

79. Question: Page 26 c 5 th bullet. Please elaborate what is being required as it relates to “mailing of

Smithsonian members to designated party” Smithsonian Response: Smithsonian Membership is maintained through a 3 rd party provider. Smithsonian memberships are sold by the catalog and web. Records of the sales in addition to the actual membership information are sent to the thirty party provider that manages that function.

80. Question: In several sections in the RFP it is required that there be a agreed upon turn-around time in days

(i.e. Ensure that all mail correspondence is read within 24 hours and addressed within 48 hours of receipt.) Please verify if those hours given are business hours (M-F) or clock hours? Smithsonian Response: Clock Hours. There are always exception to the clock hours, but any operation running 24x7 should be able to address an e-mail question at minimum by the second day. No customer sending a customer service inquiry on Friday afternoon would expect to wait until Tuesday afternoon for a response.

81. Question: Are the Standards requested throughout this RFP (i.e. Ensure that all mail correspondence is read within 24 hours and addressed within 48 hours of receipt.) Standards that are currently being reached?

Smithsonian Response: SE closely monitors all fulfillment and distribution providers. These standards are set in stone as a minimum. Customer service is a number one priority for the Smithsonian.

82. Question: Will Offeror be [the] database of record for customer data? Smithsonian Response: The company awarded the contract will house all catalog/web data.

83. Question: I‟m pricing mailing of the catalog and need to know the dimensions including average thickness or number of pages. Smithsonian Response: Any costs for postage to mail a catalog would be a detailed pass through expense and would not be included as an expense on the list of costs. Note that printing and distributing catalogs is not a requirement under the terms of the RFP.

84. Question: System, IPMS, What is required to relocate the IPMS system to a new vendor? Please include all requirements for RF, wireless specifications, and infrastructure. Smithsonian Response: IPMS is used by SE and the current provider. Where Offerors propose using a system that can’t be interfaced with the SE owned IPMS and also propose using SE’s system, a T1 line and internal wiring would be required. Specific requirements and specifications will be provide to the successful Offeror.

85. Question: Would the relocation include the RF Scanners, carts, and other equipment? Smithsonian

Response: This could be one option that Offerors can include in their proposal.

86. Question: Does IPMS connect with the SmithsonianStore.com? Smithsonian Response: No.

87. Question: IP Direct. Can IP Direct manage the requirements listed on pages 24 through 28? Is this a preferred solution? Smithsonian Response: The question is too broad. IP Direct is a complete catalog management system that can address most of the requirements. It is not THE preferred solution – it is only one solution.

88. Question: Would the new vendor be required to purchase IP Direct or would the Smithsonian Institution purchase the new module and provide any necessary equipment? Smithsonian Response: SE does not require any vendor/Offeror to purchase IP Direct. Offerors are free to propose the use of any software. SE does not intend to purchase catalog management software or hardware.

89. Question: What is required of the vendor to implement IP Direct (system, equipment, infrastructure, and any other considerations)? Smithsonian Response: Refer to the answer for question 88.

90. Question: Is there a specific contact at Island Pacific who can provide more information about the installation process and capabilities of the system? Smithsonian Response: At this time the Smithsonian will not be providing this information.

91. Question: In an IP Direct scenario, would IP Direct integrate with the website, or would IP Direct integrate with IPMS and then IPMS integrate with the website? Is it possible to receive a diagram of the systems and integrations required for the IP Direct option? Smithsonian Response: With the IP Direct scenario, IP Direct would interface with the website. No diagram is available.

92. Question: Membership. What is the current membership system? Smithsonian Response: Smithsonian membership is available for purchase through the all SE channels. Membership is annual and members receive a

10% discount on purchases.

93. Question: Memberships. Can memberships be purchased through the catalog via phone, mail, and online?

Smithsonian Response: Yes.

94. Question: Memberships. Does IPMS currently integrate with the membership system? If so, would additional integration be required into IP Direct as well? Is the integration real-time and what method of integration

(such as web services) is utilized. Smithsonian Response: No, currently the IPMS does not integrate with the membership system.

95. Question: Please provide additional details and usage of the acceptance of pre-authorized credit cards (Pg.

24). How and when is this utilized? Smithsonian Response: Credit cards are pre-authorized during the creation of a web order. Authorizations are sent the fulfillment house along with the order details.

96. Question: Which system houses and reports the financial reporting currently? In an IP Direct scenario, would all reporting come from IPMS? Smithsonian Response: SE financial reporting is provided through Lawson.

97. Question: Can samples of the reports be provided? Smithsonian Response: No, such reports will not be provided at this time.

98. Question: Retail. Are the deliveries to the retail stores part of the requirement? Smithsonian Response:

Currently, the retail store deliveries from the Distribution Center to the museums are conducted by a dedicated third party delivery service, for which the Smithsonian holds the contract. Currently, two straight trucks are used exclusively for Smithsonian deliveries, which occur Monday thru Friday. For purposes of this RFP, all Offerors proposing on Warehouse Distribution Services for the retail stores, must also include in their proposal the capability and pricing for such delivery service from the Distribution Center to the individual stores on a daily basis, Monday- Friday. Offerors may subcontract for this service. The Smithsonian reserve the right to evaluate this specific cost and determine whether it might be in its best interests to enter into a separate contract with a different thirty party for the delivery services in order to maximize cost savings.

99. Question: What percentage of retail cartons are picked and shipped as full cartons? Smithsonian Response:

This is not tracked by the DC, but it is very small.

100. Question: Please describe the temperature control requirements mentioned (Page 8. c. 3)? What types of products require this type of storage? Smithsonian Response: Current no products are temperature controlled.

Occasionally food products may be sold that would be sensitive to extreme heat. No refrigeration is required.

101. Question: What does it mean that 70% of orders are from basic stock replenishment? Please provide additional details. Smithsonian Response: A certain level of inventory is maintained at the store level. When the level drops below the minimum, the stock system generates a pick order for the inventory to replenish from warehouse stock.

102. Question: Are the “Tobys” owned by the Smithsonian or by the current fulfillment center? What do they look like? How many are there? Will they be provided to the new vendor? Smithsonian Response: Tobys are owned by SE. They are wheeled containers used to make secure deliveries to the stores. There are 40-50 full size and 10-15 book tobys. Dimensions are in RFP. They will be provided to the new vendor for use.

103. Question: Can deliveries to retail stores be sent on pallets or is it required that deliveries be made in something similar to Toby carts (Page 9.c.2)? Smithsonian Response: Yes, as stated in RFP, deliveries can be made by pallets or Tobys. But for 6 museums, deliveries can only be made on the Tobys, due to constraints for movement of inventory throughout these museums.

104. Question: The RFP states that there are 700 pick locations. How many SKUs per pick location?

Smithsonian Response: Yes, all pick locations are single item locations.

105. Question: What type of stickering or tagging is required for the 40% of items that are not pre-ticketed by the manufacturer? Smithsonian Response: Price/barcode, would be required for these items.

106. Question: What percentage of RTV units is transferred to the catalog fulfillment center (Page 9.d.6)?

Smithsonian Response: Approximately 6 transfers occurred in 2010, with an average of 2 pallets each.

107. Question: Of the 12,000 SKUs, how many are only cross docked and not maintained in inventory?

Smithsonian Response: 80% of inventory is cross docked.

108. Question: Catalog. How many stores, tents or kiosks located outside of the US? Smithsonian Response:

None.

109. Question: What are the volumes of customer service received via mail, email, and fax? Smithsonian

Response: An average of 1000 per month.

110. Question: What are the average call volumes per hour? Smithsonian Response: It varies by season, day of week and time of day.

111. Question: How many drop shipments are received per year? Smithsonian Response: 1,600 FY 2011 (Oct

2010-Sep 2011)

112. Question: Please provide more details regarding the white glove provider communication requirements?

Smithsonian Response: White glove is not used at this time.

113. Question: What percentage of calls are referrals or transfers to the Smithsonian or Museum? Smithsonian

Response: Unknown

114. Question: What security and quality control measures are required for the lockbox operations?

Smithsonian Response: Security controls for you existing lock box operation will be reviewed by SE accounting.

115. Question: Can you provide the number of pallets or cartons received on a monthly basis for the Catalog

Fulfillment? Smithsonian Response: No. Units are provided in RFP.

116. Question: Are any of the fulfillment inserts personalized, other than gift cards? Can a sample of any personalized pieces be provided? Smithsonian Response: No, fulfillment inserts are not personalized.

117. Question: Does the 4 minutes and 36 seconds per call include the data entry and credit card processing?

What is the average time for a customer service call? Smithsonian Response: Average call is 4:36 calculated for orders and CS.

118. Question: What is the total square footage of the catalog fulfillment center and the call center currently dedicated to the Smithsonian? Smithsonian Response: It is a shared environment – not dedicated.

119. Question: Is the vendor required to print the content of the provenance cards or are these cards pre-printed and stocked? Smithsonian Response: Cards are pre-printed by SE and stocked.

120. Question: Does a Smithsonian Resident Associate receive any unique benefits or treatment relevant to the catalog or store transactions? If so, what percentage of transactions result from this membership base? Smithsonian

Response: The list of discounts for all Smithsonian members is listed on the Smithsonian site http://www.smithsonianstore.com/smithsonian-membership-9919.html, 10% discount on products. The overall transactions of orders by the members is approximately 50%.

121. Question: What square footage is required for jewelry secure storage? Please detail security and any other storage requirements. Smithsonian Response: Approximately 400 sq for jewelry picking.

122. Question: What are the locations of the Smithsonian‟s primary merchandise providers? Smithsonian

Response: Smithsonian’s primary merchandise providers are located in the United States. The primary vendors for the SI are located in the US. The actual location of the vendors changes based on the products purchased by the buyers. Buying is an ongoing process and as vendors change so do the locations.

123. Question: Please describe the support requirement of collection, reporting, and mailing of Smithsonian memberships to designated party (Page 26.b.3.c)? Smithsonian Response: Smithsonian Membership is maintained through a 3 rd party provider. Smithsonian memberships are sold by the catalog and web. Records of the sales along with membership information is sent to the 3 rd party provider that manages that function.

124. Question: Who is the Smithsonian‟s current Freight Management Company (Page 6, C.1.b.2)?

Smithsonian Response: DM Transportation Management Associates.

125. Question: Since this is not a Federal contract and does not follow federal procurement procedures, please confirm that SCA rates will apply. If so, what labor categories are to be used? Smithsonian Response: See the response for question #1. Also, the Smithsonian can’t provide the labor categories for Offerors to propose, due to structure of this RFP. Offerors are permitted to propose on several options and within each option, there are different ways to provide the services-such that the labor categories that we might list out may not match those that an Offeror may use to provide the same service.

126. Question: Can a copy of the bidders list be provided for teaming options? This is helpful in securing small business and minority business owner participation. Smithsonian Response: For this RFP we will not be able to provide such a list. Over 100 firms expressed interest in receiving the RFP, but the Institution at this point has no way of knowing whether or not those same firms will be proposing on the RFP.

127. Question: Can we receive copies of current promotional materials relevant to this RFP? Smithsonian

Response: Please visit www.SmithsonianStore.com for current promotions and to see what products we currently sell.