Mastering Omnichannel Fulfillment: 3 Key Strategies for Retail Success
According to Supplychainbrain contributor Frankie Mossman, in retail — as in many industries — omni-channel fulfillment is now a baseline customer expectation. Once cutting-edge, now being able to offer consistent, personalized service across in-store, online and mobile buying experiences constitutes table stakes in the Digital Age, with a McKinsey report going so far as to say omni-channel is “a requirement for [retail] survival.”
However many retailers are having trouble realizing the full potential of omni-channel fulfillment. Often, their existing systems — inventory management and fulfillment, third-party e-commerce and logistics platforms, marketing and customer service automations, and more — aren’t integrated and don’t communicate with each other. This lack of coordination and visibility leads to duplicate order entries and inventory shortages, which impact order fulfillment and the customer experience.
Improving visibility, accelerating speed to market and optimizing omni-channel fulfillment requires retailers to transition to flexible and responsive omni-channel setups. Here, we outline three strategies that will set retailers on their way to fulfillment optimization — that is, efficiently managing and fulfilling customer orders across channels while minimizing costs and maximizing customer satisfaction.
Strategy 1: Meet omni-channel customer demand in real time. Retailers use various technologies and systems to manage sales, fulfillment and distribution. Often, these systems are not connected or sharing data, resulting in inaccurate real-time inventory visibility, which in turn leads to suboptimal decision-making and stock-related issues. Using a unified system that provides a view of both e-commerce and physical store inventories in real time will allow retailers to see what items they have available and where those items are located (physical store, warehouse), so they can avoid stock issues.
Strategy 2: Understand omni-channel complexity and adjust end-to-end fulfillment operations accordingly. Because omni-channel involves many moving parts (various channels, multiple network points receiving and storing information, dispersed inventory) retailers need to be strategic with their end-to-end planning, which requires optimized forecasting, inventory management and data flow. It’s imperative for data to be connected across channels and systems in order to make more informed decisions.
Strategy 3: Capitalize on in-store for omni-channel fulfillment. Today’s customer expects their product faster than ever before, and traditional distribution centers just can’t facilitate those expectations. Increasingly, retailers are moving away from distribution centers and leveraging their own assets (that is, in-store excess space) to house extra products for omni-channel fulfillment. And data shows that in-store omni-channel fulfillment — connecting physical and online channels to deliver the exact product a customer wants, at their preferred POS and via their preferred delivery method — increases conversion by almost a full point vs. brands with no omni-channel offerings (3.73% vs. 2.90%). Omni-channel capabilities include ship-from-store, mobile checkout, curbside pickup, and buy-online-pick up-in store.
In the Digital Age, as customer expectations rise and competition increases, retailers have limited opportunities to win and retain customers, and their success in doing so centers on how quickly they can meet their customers’ demands. Accelerating the click-to-customer experience is critical to achieving this. Omni-channel, demand-driven fulfillment.
A 4PL service provider, can support, and meet many of the multichannel logistics challenges.