About 30 percent of all online retail is now fulfilled using in-store pickup, and demand continues to soar.
Big retailers like Walmart and Home Depot have so far led the pack in capitalizing on this trend. In 2017, Walmart rolled out Pickup Towers at 200 stores and announced plans to add another 500 by the end of 2018. For the uninitiated, the Pickup Tower is a 16-foot-tall monolith planted at the front of the store like a giant vending machine, retrieving and dispensing prepaid merchandise. Supplemented by Pickup Lockers, which allow customers to collect larger orders, Home Depot BOPIS options will be available at 2,200 stores and an estimated 40 percent of the U.S. population.
Home improvement giant Home Depot reported that 47 percent of all online orders in 2018 were fulfilled by BOPIS, which leverages in-store inventory to fill orders, or BOSS (buy online, ship to store). Similarly, Kohl’s has enjoyed a 25 percent uptick in sales as a result of these two fulfillment methods.
Convenience is king
The appetite for more choices and greater convenience is clearly growing. According to Adobe Analytics, between Thanksgiving and Black Friday 2018, BOPIS transactions jumped 73 percent: After filling up on Thanksgiving dinner, shoppers were able to fill their online carts and pick up their purchases the next day, avoiding bargain-frenzied crowds, long lines and the stress of last-minute holiday shopping.
A March 2018 consumer trends report shows that 67 percent of survey participants had used BOPIS within the last six months. Two-thirds of shoppers said that multiple fulfillment options influenced their willingness to complete a purchase. Avoiding shipping fees was cited as the top reason customers choose BOPIS, followed by wanting the item sooner. With savings and instant gratification as the rewards, consumers are happy to travel.
That being said, it’s critical that retailers offer a frictionless customer experience that delivers on the promise of expedience. This means having items in stock and ready for pickup as well as having clearly outlined pickup procedures and staff who are properly trained in BOPIS fulfilment. The process must be convenient and quick; having to stand in long lines to claim paid-for items defeats the whole point while creating disgruntled customers. But when done well, in-store pickup yields big wins for retailers.
Generate more foot traffic and upsell opportunities
About 40 percent of BOPIS shoppers make unplanned purchases while in store, to the tune of roughly $40 per trip, and a happy customer buys more. Browsing online may be easy, but nothing beats touching, inspecting or even smelling products when it comes to making purchasing decisions. Sales staff should be ready and able to make suitable recommendations.
Move more inventory
A BOPIS model with integrated inventory management facilitates better stock management across the entire supply chain, effectively turning your stores into a distribution hub. Stock that’s selling suboptimally can be strategically redistributed or sold wholesale to create efficient inventory turnaround and boost cash flow. And the beauty of using BOSS to fulfill an order from the nearest location is that, in essence, retailers are never out of stock.
Save on overhead costs
The customer saves on shipping, and so do you. The BOSS model also reduces the need for stock on hand, allowing for a smaller store footprint and savings on building and leasing costs. Moreover, with a distribution center managing and filling the order, in-store staff can be freed from the burden of picking and packing.
To identify where a product is overstocked and pull from that location to fulfill an order, you need a unified view of your inventory. Robust inventory management software will give you a real-time, high-level view of all units held across all locations, including online, physical stores and warehouses. This enables you to understand cost of goods sold and stock movement to plan more effectively going forward. It also supports store-level inventory management, making it easy for managers to monitor stock levels and reorder products.
A POS with multi-location inventory capabilities allows you to manage your supply chain using a single interface, saving you time and money while eliminating redundancy and potentially costly errors. Cin7 provides an all-in-one solution with built-in inventory management and POS modules and third-party logistics (3PL) and electronic data interchange (EDI) integrations for retailers and wholesalers wanting to streamline their operations and/or sell to big retailers like Amazon, Target and Sephora. Are you invested in your future?