Logistics: anticipating an increase in omnichannel flows

Expert opinion from Nicolas Lucas,Pre-Sales, Reflex Logistics Solutions, Hardis Group.

Web-to-store, mobile-to-store, web-in-store, store-to-web… omnichannel retail is in full swing, promising consumers the ability to order from any channel and have items delivered and/or return them however they choose. To deliver this promise, the supply chain needs to reinvent itself to become omnichannel and customer focused at the same time as controlling costs.

Complete visibility of stock in near real time

With an omnichannel approach, retailers face a number of challenges due to the variety of order channels (web, call centers, mobile devices, terminals in stores, etc.), the increasing number of distribution, storage and preparation centers (warehouses, stores and suppliers) and the range of delivery and return methods on offer (the customer’s home, pick-up points, stores, drive-through collection, etc.). In other words, the silo supply chain is no more so say hello to the cross-functional supply chain!

The consequence of this is that retailers need to know the status of their stock throughout the distribution network (warehouses, brick-and-mortar outlets and suppliers) in real time. This enables them to offer their customers, whether they are in the store or on their computers or smartphones, only those products and delivery options which are available at the time of ordering: buying or reserving the product on the Internet, picking it up later from the nearest store, ordering it in a store and having it delivered to their home by another store carrying the stock or directly from the warehouse, etc. This involves a near-continuous synchronization of information in the company’s different systems: payment systems in stores, warehouse and stock management systems, ERP, e-commerce applications, etc.


Optimize order picking from stores

The increase in omnichannel shopping is also causing changes in the retail outlet: serving customers, making sales, handling incoming goods, replenishing shelves, restocking and taking inventories are now accompanied by tasks relating to reservation and order management (click & collect, reserve & collect), returns management, preparation and shipping of online orders.

Although flows are still quite minimal, it is a safe bet that they will increase over the coming years, if not months. So while stores are able to prepare a few orders from digital channels a day, they are not yet organized to deal with a hundred of them, if that is what is wanted. Unlike logistics warehouses, preparing orders from digital channels is not the retail outlet’s main purpose. Retailers will need to equip staff with tools to make them more efficient at order picking such as solutions for quickly locating products in the store or optimizing “rounds” (collecting products), just as things have been done for many years in warehouses.

No doubt they will also have to make choices based on several factors: value creation for the customer, the ability of stores to absorb the additional omnichannel-related workload, the geographical network of stores, the cost of preparation and transportation from the warehouse compared with the store, volumes to be handled, etc.