Tag: store solutions
The advent of "buy online, pick up in store" (BOPIS, a.k.a, "click and collect") shopping is giving many brick-and-mortar retailers a way to reclaim precious market share, while at the same time driving up store visits. As more consumers embrace the opportunity to pick up online orders at the nearest store, retailers that can efficiently provide this emerging in-store fulfillment option gain a clear strategic advantage. But making good on the promise to fulfill BOPIS orders quickly is easier said than done. Customers who choose this option typically want to retrieve their purchases within a few hours after placing their order. To meet this service level expectation, retailers must be prepared to execute a new set of demanding tasks that are typically performed by existing store associates.
The increased challenge to the labor force stems from the nature of the in-store fulfillment process. In the traditional shopping paradigm, customers traverse a store and fill their shopping carts with the products of their choice, and then proceed to a check-out line. In the click-and-collect scenario, it's the store associates who must now retrieve these items scattered throughout the store - without adding hours to their shift or hikes in the store's budget by hiring additional labor. This underlying change and the need for increased order fulfillment efficiencies are the reasons why retailers are seeking ways to optimize BOPIS order processing and fulfillment.
It's not enough to simply offer the option of click and collect; it must also be profitable for the retailer. Here are three tools that are proven to be effective in warehouse order fulfillment that will make in-store order fulfillment profitable by improving the efficiency and accuracy of existing labor resources:
- Voice-based task engine - Voice solutions have a lot to offer stores moving to a BOPIS model. With very little time, new or temporary store associates can quickly be trained to use the system nearly as efficiently as an experienced associate. Voice direction allows eyes-up, hands-free operation, so staff can still provide in-store customer service as they fulfill BOPIS orders. Voice-directed task engines calculate the proper level of resources needed to fulfill existing orders, while capturing real-time transactional updates to ensure inventory accuracy by validating each item picked.
- Optimized picking sequences / batching orders - With labor management software (LMS), optimal picking travel paths through the store are identified and used to direct store associates on the most efficient picking sequence. As orders come in, items can be batched to leverage economies of scale where appropriate. The result is greatly reduced foot-travel time and a more predictable order fulfillment process that ensures customer service level agreements are met.
- Labor planning - LMS also enables a more accurate planning process that evolves as your staff becomes more efficient. Retailers can precisely staff areas for optimized resource usage, deploying only the necessary workforce required to meet the demand. Ongoing labor performance data is captured and fed back into the system to improve forecasting and the predictability of the fulfillment process.
To learn more about how voice and LMS can combine to help retailers add BOPIS to their omnichannel fulfillment strategy, please visit the Store Solutions section of our website.
Today's traditional brick and mortar retailers are faced with the reality that modern internet retailers (e-tailers) have permanently changed the order fulfillment game. According to the U.S. Chamber of Commerce, the percent of e-commerce retail has grown from 3 percent to 9 percent in the last decade. Among the Millennial and Generation X demographics, this trend is rapidly increasing. As a result, e-tailers have changed their business model and built distribution networks to provide the seamless execution needed to deliver on increasingly high consumer expectations. Two-day delivery or less is the new norm. With price and speed becoming the lowest common denominator, the customer experience has been redefined and brand loyalty is taking a back seat.
The question for traditional retailers - whose business model is based on the premise that customers prefer to purchase items in stores - is this: How can we effectively utilize our store network to exploit these new opportunities? In Intelligrated's most recent On The Move webinar, James Hendrickson, senior product manager, retail solutions from Honeywell, and I explained how retailers can level the playing field by embracing their stores as distribution centers and realizing that their physical storefronts are a huge advantage.
To begin making this transition, it's important for traditional retailers to remember that their customers still have a need for instant gratification. There is no substitute for going to a local store to evaluate and purchase items - customers still want the product knowledge and expertise from sales associates. The ability to return items easily and to avoid shipping charges is also driving customers back to the store.
Today's consumer also still wants to shop online from any of their connected devices. For traditional retailers to stay relevant and offer the best of both retail worlds, they need to support this e-commerce preference and offer new shopping methods, like buy online pick up in store (BOPIS). Covering both of these bases is absolutely necessary to taking back market share.
Improving store efficiencies - while excelling at BOPIS and other complex tasks - requires embracing the role of the store as a mini-DC and deploying the behaviors that drive DC execution. It starts by understanding the similarities of order fulfillment processes used in both DCs and stores, such as receiving, staging, put-away, picking, packing and shipping. It also means employing the same laser focus on processes execution to ensure inventory and order accuracies, capture transactional data and direct work along every step of the fulfillment process.
In our webinar, we recommended starting this transition by focusing on the processes that cause the most pain for traditional retailers. Typically, this is the fulfillment of e-commerce orders, whether that's BOPIS, or buying online and shipping from the store. This can be accomplished by focusing on three order fulfillment building blocks:
- Systemically direct all work to optimize order release and task execution. If retailers don't direct the work, they will not hit their goals.
- Build a foundation of transactional data around each process by tracking, scanning or speaking every activity. Not only can this be done without slowing the process down, it will also build a "chain of custody" of inventory in the stores that results in true inventory accuracy.
- Set labor standards for all work and track against these standards. This drives predictability in task duration and performance, such as knowing exactly how long it should take to do basic tasks like picking an online order or unloading a truck.
By employing these principles, retailers can become unpredictable in the fulfillment of e-commerce orders and achieve the execution efficiencies to compete on a level with the e-tailer giants. To learn how to turn your stores into DCs, please visit our On The Move webinar archives and view the session in its entirety.
To learn more about Intelligrated Store Solutions, visit booth #2434 at NRF's Big Show on January 15-17 in New York City. Demo the Voice solution to be entered in a drawing to win an Apple MacBook Pro.