Omnichannel order fulfillment for the modern retailer
In recent years, adoption of buy online, pickup in store (BOPIS) has grown steadily, with shoppers citing savings on shipping costs as the most popular reason. Now, because of safety and convenience, nearly 60% of consumers say they will shop somewhere else if a retailer doesn’t offer BOPIS. Retailers know that flexible order fulfillment options like BOPIS, curbside pickup and ship-from-store (SFS) are essential to meet customer expectations and keep inventory moving. It’s also important to know and plan for new fulfillment options and the impact they could have to your people, processes and technology.
With this framework in mind, you can better enable and optimize your omnichannel strategy in 2021. Here are some quick hits to consider:
1. People – your biggest asset
a. Train them and plan for refreshers
b. Give them the tools to succeed
c. Motivate them with realigned incentives
2. Processes – old ways won’t work
a. Identify the processes that need refining
b. Reimagine your stores to accommodate new services
c. Details matter when it comes to your brand
3. Technology – modernize to manage new models
a. Resilience starts with inventory management
b. Go cloud-first so you can scale and manage peak demand
c. Align your tools to your fulfillment strategy
Let’s explore in detail.
People. Behind every new order fulfillment option is the staff making it happen. Customer-facing store associates are now being tasked with picking and staging activities to support BOPIS and curbside options. They may also be responsible for packing and shipping to support SFS. New responsibilities create new complexity, and as a result, 80% of retailers report that training store associates to properly pick, pack and ship online orders is relatively challenging. When shoppers come into the store, associates are also engaging differently – making relevant product recommendations to drive add-on sales, offering in-aisle checkout to enhance customer safety, and ordering online or from another store for an endless-aisle experience.
Some leading retailers are going even further. Signet Jewelers pivoted to selling jewelry online by adding new consultation and visualization services and realized a 60% increase in e-commerce sales during the holiday season. REI is implementing virtual outfitting with great success, making it easy for shoppers to arrange one-on-one online appointments with an expert sales associate. Enabling store associates to excel as their duties change requires three things – training them on new tasks, empowering them with the right tools and technology, and aligning incentives to their new roles. How well you support your staff as you rollout new selling and fulfillment options will make or break your omnichannel strategy.
Process. Perfecting processes to meet shoppers’ expectations for a quick, efficient and safe experience is essential. However, barely half of retailers surveyed agree they have the right processes in place to execute on a consistent omnichannel strategy, so there is significant room for improvement. Thinking through the behind-the-scenes logistics takes dedicated effort—organizing backrooms for extra inventory and shipping supplies, setting up packing stations, and making room to stage orders for pickup.
On the customer-facing side, you need clear processes for orchestrating curbside pickups, managing traffic flow, and minimizing wait times to drive customer convenience and maintain safety. Curbside delivery of high-ticket items and perishable goods require additional considerations. Despite having many of their locations in malls and shopping centers, American Eagle is managing curbside pickup well, with trip-tracking and alerting technology to notify associates when customers are en route and when they arrive. For shoppers who choose to enter stores, dedicated pickup areas equipped with cameras and audio alerts like Tractor Supply has set up, as well as lockers, provide convenience and assurance that they can pick up their orders efficiently through self-service.
When considering processes that rely on third parties like same-day delivery and drop-shipping, service level agreements (SLAs) and other measures need to be in place to protect your brand. Reverse logistics processes also need to shift to support each of these fulfillment options. Think buy online, return in-store or curbside, or smart returns—and providing the consumer with a return label to ship the product back to an optimal location.
Technology. The number one initiative for retailers in 2021 is becoming more resilient, and supply chain resilience starts with inventory visibility. Regardless of circumstances, every omnichannel order fulfillment strategy must live up to customer expectations—and those expectations are high. More than three quarters of U.S. online adults believe that it’s important for retailers to offer real-time inventory visibility. Shoppers want to be able to find and research products, confirm availability, checkout, and track delivery entirely through the digital experience—yet 86% of retailers say that inventory accuracy is challenging.
In a future where disruptions are more frequent and unexpected, an intelligent, SaaS-based order management solution (OMS) helps you orchestrate your entire order fulfillment network, scale quickly and manage peak demand for a frictionless customer experience. Look at Sally Beauty who reopened 3,000 stores across the U.S. with new omnichannel capabilities in three short weeks. With IBM’s SaaS-based OMS as a foundation, they were able to scale quickly and manage peak demand, which was essential considering they re-emerged into an environment that was the equivalent of Black Friday times ten.
If you’re considering expanding your OMS capabilities, make sure to select an intuitive solution, so it’s easy for store associates to get the visibility they need to move in-store inventory quickly while getting customers what they need within minutes—be it through BOPIS, curbside or same-day delivery. Real-time inventory visibility increases sales conversions, and AI-infused fulfillment optimization enables you to meet customer expectations while reducing overall cost-to-serve. When it comes to returns, reverse logistics orchestrates what can be a complex and expensive process, regardless of the original purchase channel that was used.