Successful Retail Fulfillment Requires Proactive Insights and Planning
Retail fulfillment is exceptionally important for many franchises, but not everyone can keep up. Here are some tips to get it right.
As a franchise retailer, you understand the importance – and the struggle – of keeping up with an ever-increasing volume of orders. It can be challenging and expensive to meet these demands if you're unprepared.
That's why it's critical to have a solid "last-mile retailing" plan in place. Slow or disorganized fulfillment can lead to costly consequences and damage your relationship with customers, especially during particularly busy sales seasons. Late deliveries, running out of inventory, and orders with missing products can be detrimental to your brand’s reputation.
You must be ready to handle a swift increase in order volume at any time. Here’s everything you need to know about retail fulfillment.
Are your 'convenient' fulfillment options causing more issues than they solve?
Today's consumers value efficiency and convenience. Options like in-store pickup, office delivery, local store shipping and more are extremely valuable to offer your customers.
Flexible fulfillment options translates to satisfied customers and a competitive edge. However, according to a recent Gartner report, retailers who go above and beyond with these options often end up spreading themselves thin. As Gartner VP Analyst Robert Hetu says, retailers often end up negating their revenue gains by spending excessively on options like same-day delivery, free shipping and free returns.
While the value of these fulfillment options a consumer is obvious, these systems and practices must be must be carefully monitored and managed to make it worth it for the retailer.
Take BOPIS (Buy Online, Pick Up In-Store), for example. With BOPIS, consumers can avoid shipping fees and pick up their product on their own time. Additionally, customers often end up making in-store impulse buys when they pick up their online orders. By displaying small items and sales/deals near the pick-up register or customer service desk, you may be able to trigger more purchases.
However, if brick-and-mortar retailers aren't keeping an eye on in-store stock as they fulfill online orders, they might run out of inventory and lose out on regular sales. If you typically fulfill your online orders from a warehouse, you might miscalculate or underestimate the amount of stock to allocate to your store shelves. If you fulfill online orders from your store inventory, your warehouse may end up overstocked, which ties up valuable cash and space.
Before you invest in and implement any type of "convenient" fulfillment option, you must ensure that your e-commerce, store and DC systems are fully aligned. It's important to prioritize offers that work best for your business, considering both convenience and fulfillment speed.
Be proactive about order fulfillment by utilizing the right technology
Predictive analytics has become a popular buzzword in the retail world, and for good reason. This technology helps retailers understand how much inventory they need to purchase and where it needs to be allocated (warehouses, store locations, etc.) for optimal order fulfillment, long before those orders are even placed.
These predictive systems also provide better visibility into future orders, consumer behavior and demand. They allow your business to proactively account for a multitude of factors – seasonality, geo-demographic diversity, competition, promotions, consumer demand, current and future inventory levels, etc. – which is impossible to do efficiently in a manual way.
Finally, AI-based retail solutions can help retailers handle returns seamlessly and cost-effectively. For instance, a predictive analytics platform can recommend where to restock returned items so that they go to the store most likely to sell the product again.
No matter where you are in your business sales cycle, you should always be working on your franchise system’s fulfillment plan to prepare for an increased volume of orders. Without a plan or the right tools in place, you’ll be left scrambling to keep customers satisfied.
Yan Krupnik is the Director of Business Development at Retalon. Founded in 2002, Retalon is an award-winning provider of advanced retail predictive analytics & AI solutions for supply chain, planning, merchandising, inventory management, pricing optimization, with a transformational approach to the retail industry. From inception, Retalon solutions were built on one unified platform powered by advanced mathematics & AI resulting in higher accuracy and the ability to optimize unique and complex retail processes.