Brick-and-mortar retailers certainly have their work cut out as digital commerce continues to attain new heights. Most of the physical retailers are having to deal with decreasing foot traffic and diminishing in-store sales. No wonder there are so many retail stores that are closing across the globe. On the other hand, e-commerce has been riding the glory tides for quite some time now, especially Amazon. As per findings by Slice Intelligence, Amazon accounted for 53% of the online sales growth in the US.
Physical retailers have no option other than resorting to omnichannel retailing. It is imperative for them to have an online presence if they want to salvage their present situation. Brick-and-mortar retailers are looking to leverage the physical store, and its’ inventory through various omnichannel fulfillment methods.
Omnichannel Fulfillment – Competing with E-commerce
Customers today realize the value of an omnichannel experience, and come to expect the same from their brands and retailers. The only way brick-and-mortar stores can compete with online is by using various fulfillment methods. The primary objective of these methods is to optimize the in-store inventory, get the sales flowing and accentuate the role of the physical store. Customers are always on the lookout for convenient and inexpensive delivery options. Thus, such delivery methods will not just help the brick-and-mortar retailers meet their objectives, but also serve the needs of the customers. This will invariably improve the level of online sales for these brick-and-mortar stores.
The various omnichannel services include click-and-collect, shipped from store, etc. Retailers can make the cost of delivery comparatively cheaper by using the physical store as a delivery center. The clock-and-collect facility allows customers to make their purchase online and collect the item from a delivery location of their choice. That could be the store itself, a nearby grocery store, the post office, etc. the collect from store option easily allow retailers to cut down on their delivery charges. On the other hand, the store being the fulfillment center also means that customers must walk into the store every now and then. This provides the retailers with more consistent customer footfalls, and provides them the scope to create further upselling opportunities.
Consistent Revenue Inflow and Profit Margin
Omnichannel retailing is a no brainer for all brands and retailers today. The constant struggle of the brick-and-mortar stores to generate continuous sales for a healthy existence can be ended with the above-mentioned fulfillment methods. An omnichannel existence will obviously make it easier for these retailers to attend to customers across various platforms such as online, mobile, offline, etc. These fulfillment methods will further expedite sales by giving customers several options of collecting their items.
The above illustration provides an instance of how apparel retailers have achieved a fair profit margin through these fulfillment options. The above results have been validated on an order of a 100$ order. The retailers have achieved a profit margin of 32% on items brought in store, followed by 30% on items that have been bought online for home delivery. However, the best part is that customers are willing to come to store pick up their orders as well. As much as 23% of profit margin has been achieved by apparel retailers on items that have been bought online but collected in store. Thus, we get evidence that the various omnichannel fulfillment methods leverages the physical store, and helps attain fair profit margins by maintaining consistent store traffic and sale.