Note: Today’s post is part of our new “Editor’s Pick” series where we highlight recent posts published by our sponsors that provide practical knowledge and advice on timely and important supply chain and logistics topics. Today’s post is from Manhattan Associates highlighting four methods for operationalizing scalable, labor-efficient and associate-friendly ship-from-store processes.
Just a few years ago, progressive merchants started sending e-commerce and catalog orders through stores, and filling those orders with merchandise from store shelves and the backroom. Many did it to make use of excess inventory. Some did it to speed up fulfillment. Still others did it to satisfy the fast growth of online sales without buying more inventory.
Regardless of these initial reasons, ship from store has become an omni-channel mainstay. Several factors are driving the trend, including:
- Difficulty predicting demand. In a recent report from RSR1, 60% of leading merchants agreed that “the way consumers use different channels to make purchase decisions is unpredictable, but important to understand.” This makes it unlikely that every store’s inventory levels will ever be finely tuned enough to avoid unplanned overstocks and markdowns—and makes it more likely that ship from store will remain an ‘equalizer’ between regional supply and demand.
- Shrinking store footprints. Multi-brand retailers in particular face pressure to shrink store footprints and reduce inventory to minimize markdowns and fine-tune store-specific merchandise to meet local demand, but results in fragmentation of the entire assortment. Localized assortments can be a competitive differentiator, but they increase the likelihood that a customer may want an item that’s not available in a local store, which results in a save-the-sale order being fulfilled by another store.
- Free shipping. Because free shipping is today’s go-to online promotion, shipping from the closest store or the store with the most available labor can mitigate the impact on retailers’ margins.
Juggling ship from store with customer service and selling responsibilities has become a fact of retail life for store associates. The good news is, it’s possible to make ship from store a sustainable, more profitable part of retail’s new normal.
Our analysis of pilot-level trial and error has revealed four methods for operationalizing scalable, labor-efficient and associate-friendly ship-from-store processes.
