When retailers can ship online orders directly from local store locations, it not only fills an important customer demand for quick fulfillment, it also increases efficiency and minimizes shipping costs. That’s true at any time of the year. But perfecting this service by fine-tuning your order management capabilities can make an extraordinary difference during the peak holiday season, when omnichannel merchants are under pressure to provide gifts on-time, whether on store shelves or in the mail.
As retailers feel more pressure to compete with Amazon and other mass merchants by delivering fast, free fulfillment, they’re increasingly turning to store inventory to solve the “last mile” fulfillment challenge. Use of ship-from-store increased 65% between 2015 and 2017, the USPS found; now, 63% of retailers report having ship-from store capabilities, according to technology researcher Forrester, with another 17% planning to implement it in 2019 or later.
Increasing order management capabilities to enable ship-from-store is a big project, but there are powerful incentives to do so – among them, the opportunity to increase sales and satisfaction during the all-important holiday season. That’s because ship-from-store helps merchants address two top holiday pain points:
Expectations for late, free delivery are higher than ever.
Last year saw retailers pushing shipping cutoffs to the limit, with mass merchants Amazon and Target even promising on-time delivery for standard orders placed within the final week before Christmas. And still faster fulfillment is becoming the norm: Dropoff found that a third of consumers have purchased gifts online for same-day delivery, and 18% are willing to pay a premium for this service.
Retailers can meet these escalating expectations by using the inventory that’s closest to the destination address. Delivery from local stores can be faster than shipping from a distribution center, without incurring expedited shipping costs for retailers.
High demand for inventory needs to be met immediately.
Shoppers report that they encounter items out of stock on store shelves on as many as one in three shopping trips, according to IHS – and when they do, 29% buy from a competitor. Amazon Prime members – representing one in two U.S. households – are especially apt to whip out their phones to solve the problem, with 29% saying they order out-of-stock items from Amazon or another online competitor.
Retailers can fight back by equipping store associates with ready access to neighbor store inventory, and empowering them to offer shoppers free home delivery of the items they couldn’t find immediately on the shelves. This capability is especially important during the holidays, when red-letter sales events will put pressure on inventory for sought-after items.
Does your business rely on store-based fulfillment for optimal holiday performance?