We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • SUBMISSIONS
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
  • STRATEGY
  • GLOBAL
  • LOGISTICS
  • MANUFACTURING
  • PROCUREMENT
  • VIDEO
    • News & Exclusives
    • Viewer Contributed
    • Upload your video
  • BLOGS & MORE
    • White Papers
    • Webcasts
    • Events
    • Blogs
      • SCQ Forum
      • Reflections
    • Mobile Apps
Home » Retail stores can't handle omnichannel fulfillment on their own
Perspective

Retail stores can't handle omnichannel fulfillment on their own

August 28, 2013
James A. Cooke
No Comments

If retailers are going to be successful in conducting e-commerce with an omnichannel fulfillment strategy, then supply chain managers will need to get involved in some aspects of store operations. That's because—as the results of a recent study I was involved in made clear—retail stores are not capable of efficiently filling online orders.

The findings of the research on omnichannel distribution, which I worked on with Steve Banker of ARC Advisory Group, points to the problems encountered when stores perform pick, pack, and ship activities for Web-ordered merchandise. The study was conducted for Supply Chain Quarterly's sister publication, DC Velocity magazine.

Thirty-five percent of the 177 retail executives who participated in the study said they filled online orders from stock in their retail stores, and another 18 percent were doing so only at selected outlets. Now, if stores want to fill online orders, they obviously have to know what's in stock. Yet only 30 percent of respondents reported that their store inventory-accuracy level reached 98 percent or higher. That's noticeably lower than the cycle-count accuracy levels of nearly 100 percent achieved by distribution centers that are using warehouse management software.

One possible reason for the low accuracy rate was that most respondents failed to take advantage of point-of-sale (POS) information to update store inventory. Only 46 percent of the study sample said they use POS information to keep in-store inventory up to date. That's a concern, because a dearth of information on the whereabouts of items in the store could lead to retailers making promises to online buyers that they cannot meet.

There's another key issue associated with stores filling online orders, one that's so obvious that it should go without saying: Retail store operations are designed to sell products to shoppers; they are not set up, like distribution centers, for the efficient handling and picking of orders. For in-store order fulfillment to work, moreover, personnel must be taken away from cash registers, stocking shelves, or helping customers to pick and pack online orders.

If retailers want to successfully engage in omnichannel commerce using store inventory for online orders, then, they will need specially trained personnel in the stores to handle those assignments. And, I believe, those employees should be under the control of the supply chain chief, not the store manager.

In other words, if supply chain executives don't oversee pick, pack, and ship at the retail outlet level, then their retailer employers will fail at e-commerce.

Editor's note: For more about the omnichannel distribution study's results, read "Stores: the weak link in omnichannel distribution." The research will also be the topic of a special webcast on October 15, 2013, at 2 p.m Eastern/11 a.m. Pacific. Watch for details on DC Velocity's website. In addition, Steve Banker and I will be presenting the findings at the Council of Supply Chain Management Professionals (CSCMP) annual conference in Denver in October. I hope to see you there.

  • Related Articles

    A supply chain redesign for omnichannel success

    Omnichannel navigator

    On the road to a smaller carbon footprint

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

Recent Articles by James A. Cooke

Getting smart about using software intelligence

The payback challenge

A farewell, with thanks

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • The 3PL industry: time to reset

  • Resiliency starts with supplier mapping

  • Freight market growth expected to slow in 2021

  • COVID-19 and the health care supply chain: impacts and lessons learned

  • Retailers designing stores to support inventory and logistics work, not just shopping

Featured Video

6cabd6ef 64df 4460 bb11 e90c2bdea0a5

Identifying Intralogistics Solutions to Fit Your Operation: LinkedIn Live Ep. 4

Viewer Contributed
As technology evolves, the advantages of using semi- and fully automated solutions to increase productivity and address labor shortages are clear. However, before an organization jumps fully into automation, optimization is a key step that must happen first. Intralogistics solutions, such as Raymond’s iWAREHOUSE and...

FEATURED WHITE PAPERS

  • Using innovation to manage peak seasonal demand

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

  • Shaping Up Last Mile Delivery to Surpass Customer Expectations

View More

Subscribe to Supply Chain Quarterly

Get Your Subscription
  • SUBSCRIBE
  • E-NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing