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It is no secret that retailing has changed in the age of the internet. Customers are no longer content to go into a store and just buy what is on the shelf. Today, a consumer now checks prices and shipping options through websites and smartphone apps. They may want to buy an item online and pick it up in the store. Next, they may choose to exchange the item through a website. That sounds like a stock management headache, but working with omni-channel fulfillment makes accommodating customers easier and more efficient.
In the past, retailers commonly shipped from two warehouses. One was strictly for e-commerce and the other was only for retail stores. Traditionally on the east or west coast, customers in Middle America had a longer time to wait for their goods. As e-commerce grew, retailers had to find new fulfillment methods. Businesses such as Toys ‘R’ Us, offered ship-from-store options to meet the demand.
With the rise of smartphones, retailing grew even more complex. According to Internet Retailer, 91% of consumers research and buy products on a laptop or desktop. But, 56% research and 41% purchase on smartphones. This is because social media like Facebook and Snapchat are now in the retailing mix. Some consumers do not even visit the company’s website before they buy. The focus of omni-channel fulfillment is on the consumer and the product, but there are endless ways for them to get together.
Omni-channel fulfillment is simpler than it looks. A consumer makes a purchase from a concession, mobile app, website, catalogue, franchise or store. The retailer continues with the process and handles ordering, stock management, fulfillment and sales. The center of this method is always the stock pool. It includes stock from all sources, such as stores, kiosks and warehouses. To view an infographic on this, see RetailAssist.
Consumers make purchases in any way they want but the retailer maintains full control over the stock, even if it is in many places. Omni-channel fulfillment ensures efficient and accurate delivery of the correct product. Suppliers see the stock as a whole, not fragmented through different channels.
Omnichannel fulfillment involves creating a centralized strategy that helps your business streamline and execute the order fulfillment function seamlessly across multiple channels. The procedure applies to receiving, warehousing, processing, picking, packaging, and shipping customer orders.
The strategy allows a logistics provider to remain agile, optimizing the fulfillment workflows and efficiently handling or dispatching orders from several selling channels in a single place.
Adopting an omnichannel fulfillment strategy enables automation, simplification, and speeding up order fulfillment activities. It increases customer satisfaction, agility, and speed for better bottom lines in the competitive business world.
Centralizing inventory management is the core purpose of omnichannel fulfillment. Integrating an inventory tracking system lets you redistribute and reallocate available merchandise to many channels.
Customers find it easy to find, order, and receive their items through a channel they prefer. You don’t have to worry about setting up individual order fulfillment infrastructures for each sales channel.
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Many assume omnichannel and multichannel fulfillment is the same because the terms come up interchangeably. However, there are distinct differences in how the processes conceptualize the customer’s experience.
Unlike omnichannel, multi-channel fulfillment means each selling channel maintains its inventory, ordering workflow, and delivery processes. These channels are digital, physical, or a combination of both. For example, a business will sell products on a website and a physical location through different marketplaces or platforms.
From the multi-channel fulfillment definition above, it’s clear that the omnichannel strategy relies on the former’s foundation. However, critical differences are present in a customer’s experience, goals, and execution.
Omnichannel fulfillment relies on identifying all touchpoints between the customer and the brand. Next, the strategy seeks ways to capitalize on each moment to increase the convenience for customers or enhance their connection to a brand.
A multi-channel fulfillment strategy focuses on putting products in front of as many qualified customers as possible. However, the emphasis is on increasing the online presence and not fostering a better customer experience.
Adopting the capabilities of different channels at once helps your business build new and memorable customer experiences. These are experiences your customers would see while on a single channel.
Multi-channel aids your customers in finding the products they want. The strategy lets them purchase on channels they prefer, such as Amazon, but limits exposure to your brand on that specific channel. You can deploy more marketing tactics for incorporating your Amazon business into a holistic omnichannel fulfillment strategy.
Omnichannel retailing refers to how physical stores and your online operations can work together. Multi-channel retailing is how a business has online and physical stores that implement separate channels.
Multi-channel marketing will use multiple selling channels to send your customer to the same or unrelated content. Omnichannel marketing requires building upon the interactions from other pipelines to advance customers to a touchpoint.
Many physical retailers are not leveraging the retail digital shift that’s currently happening. Many of these businesses are experiencing reduced foot traffic, a decline in sales, and closures. Over 800 stores will close in 2023 in the U.S. due to a “retail apocalypse.”
Businesses adopting an e-commerce-only approach are making their way to success atop the digital commerce rise. For example, Amazon accounts for over 53% of its growth in online sales.
The predicament means physical retailers are using omnichannel order fulfillment methods to power their stores and in-store inventory to compete better in the e-commerce space. So, running a retail business means dealing with a high volume of orders daily and messy shipping.
The key components to satisfy customer expectations and optimize the trend are fast and timely responses and a consistent shopping experience. Omnichannel fulfillment offers many benefits, making it an indispensable business activity factor.
Poor inventory management is costing the business world over $2 billion. A lack of centralization, automation, and visibility accelerates the problem as some retailers try cutting corners.
Below are common multichannel inventory management difficulties to avoid.
With omni-channel fulfillment businesses can offer:
Other advantages include real-time reporting, adjustment to seasonal demand, and accurate inventory management. Omni-channel fulfillment leads to new sales opportunities as retailers discover different ways to market items through different channels. Streamlined warehouse operations get the product to the consumer quickly and with less cost. Satisfied customers are more likely to come back, and this makes your brand look better than a company that doesn’t use this fulfillment method.
Here are the five biggest benefits of deploying omnichannel order fulfillment in your business.
Unfortunately, there are no one-size-fits-all omnichannel fulfillment methods because each business has its unique needs. But four strategies can work across the board.
Outsourcing your omnichannel fulfillment to a 3PL provider ensures you cover all aspects. The strategy also makes it easy to get into new sales channels while managing your orders and inventory from a single dashboard.
The strategy involves maintaining your products and delivering them to the post daily or renting a warehouse and running a crew for fulfillment. However, inventory strategy can be a challenge when you keep fulfillment in-house. A major issue is getting locked into a long-term warehouse lease as your operations outgrow the facilities or use less of the space available to you.
Some businesses prefer the hybrid fulfillment approach. They fulfill some orders and partner with service providers on other channels. Others have a physical store from where they sell out, which allows for curbside or in-store pickups. The stores can also fulfill orders and act as hubs for product distribution.
Using an ERP and order management system allows you to set the rules and consolidate different channels for a complete fulfillment strategy. Service providers often have the software, but make sure you evaluate it.
Some solutions include B2B shipping, which integrates e-commerce platforms and marketplaces with other tools, including order, inventory, and returns management modules.
Due to the “Amazon effect” consumers now expect options that were impossible in the days before e-commerce. They expect faster, easier and less expensive shipping. According to an article on retailTouchPoints, Amazon pioneered fast shipping and versatile stock options, but this now means that consumers expect the same from most other retailers. Speed and accurate delivery through an omni-channel supply chain allows your business to compete with big companies such as Amazon Fulfillment. During the record holiday sales season of 2014, retailers such as Macy’s Target and Best Buy greatly improved delivery with omni-channel fulfillment .
Considering the variety in modern e-commerce, omni-channel fulfillment allows companies to look consistent across all of their retail channels. The consumer sees the same shipping policies, prices and product availability on Facebook as they do in the retail store or on the web site. These areas are more consistently and accurately updated.
Using omni-channel fulfillment not only brings your company up to date, but it allows for speed, accuracy and efficiency. For more information about fulfillment options, please contact us.
I want to say thank you for your help in finding a warehouse so quickly. Your service was amazing. I received replies the same day and have selected a company that will work well for us. I definitely recommend your services.
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