Omnichannel defines how customers use several different platforms to buy products. It aims to satisfy consumers’ needs immediately, regardless of which shopping channel the consumer uses. But how does omnichannel fulfillment work?
First, let us define omnichannel. According to Hubspot, omnichannel is a lead nurturing and user engagement approach. Omnichannel allows a company to access its products, offers, and support services to customers or prospects on all channels, platforms, and devices.
What is omnichannel fulfillment?
The omnichannel fulfillment model developed in response to the growing number of consumers demanding better shopping experiences whenever and wherever they want. According to a recent Pulse study, 44 percent of customers want to buy online and pick up at the store. In addition, 62 percent of customers want to purchase online and make returns in-store.
This evolving consumer sentiment led to retailers re-thinking their fulfillment and transportation strategies. For example, retailers must now satisfy the customer’s order from any channel and organize an easy-to-follow return procedure for each product.
How to start the omnichannel fulfillment process:
Adapting your company’s fulfillment processes to the omnichannel world is not an easy task. Customer demand has changed the entire supply chain environment, and retailers need visibility into shipments and inventory.
As omnichannel continues to challenge shippers and redefine retail, transportation companies are making significant efforts to adapt, taking on more responsibility than ever before. Here are a few integrations businesses are using to enhance their omnichannel fulfillment processes:
- Reasonable customer experience assurances
- Guaranteed delivery options
- Next-day or same-day delivery
- Real-time track and trace options
What challenges do omnichannel retailers face?
Organizing inventory across multiple channels and delivering items from stores, warehouses, and distribution centers is one critical challenge retailers with various channels face. Proper inventory management across all channels is crucial to ensuring the omnichannel process is smooth and efficient for the retailer and the customer. In addition, omnichannel retailing would not be possible without stock tracking systems and proper DOM (distribution order management), which help organize the inventory.
Next-day or same-day delivery has transformed the retail industry in recent years. Retailers that embrace the omnichannel strategy need to deliver products already purchased by the customer, so fast delivery is necessary. Customer expectations have always been high, but with the invention of Amazon’s Prime two-day delivery promise, customers expect some level of haste from every retailer when they place an order for delivery.
Managing the Supply Chain
Managing supply chain initiatives can be made easier with in-house assets or hiring an experienced 3PL to meet the customized requirements of omnichannel retailing. Providing customers with a seamless, integrated, and consistent shopping experience across different channels is the easiest way to ensure customers have a positive experience during any interaction with your brand.
Understanding Consumers’ Behaviors
Understanding consumers’ behaviors can be challenging but provide priceless information to your business. Tracking users’ behavior across all channels is a great way to get a clear view of each channel’s efficiency and better understand where customers’ heads are when purchasing a product. In addition, being attentive to consumers’ shopping habits and activities can help a company develop a strategy that meets and exceeds customers’ needs. Resources like Google Analytics, Google Ads, Tag Manager, and Data Studio are all tools that assist retailers in better understanding their target consumers’ behavior patterns and tendencies.
Managing Product Offerings
Keeping product offerings consistent is another way to improve the customer experience, regardless of purchasing medium. One crucial way to optimize the omnichannel experience is to maintain the same product prices and promotions database across all channels. When companies take a multiple channel approach to selling products, customers expect that there will be consistency across those channels. Focusing on providing a seamless experience with consistent pricing, promotions, and product offerings is a great way to increase the return rate among customers regardless of the method through which they shopped.
How to Achieve Excellence In the Omnichannel Fulfillment
To achieve excellence in omnichannel fulfillment, companies should follow these four steps:
Step 1. Merge Separate Channels
For better inventory management (and customer satisfaction), retailers should offer an option to order online and pick up in-store and an opportunity to order from the store and deliver directly to the customer. Statistics show that about a quarter of all customers make additional purchases when they pick up an online order. Therefore, the website should provide information on the closest store(s) to the customer for order pickup. As a result, the order management system should support in-store fulfillment and online order inventory.
Step 2. Inventory Visibility
Inventory visibility is at the core of the omnichannel strategy. It shares inventory details among channels, which gives a strategic advantage for the “buy online – ship from store” model. Using numerous stores as fulfillment centers allows for quick delivery with lower costs since the distance to the customer is shorter. Proper inventory visibility makes it possible to implement a successful omnichannel fulfillment strategy to provide better service to your customers while saving money on transportation costs.
Step 3. Customer-Centric Mindset
Retailers should concentrate on data gathering and process optimization in the supply chain. Provide customers with inventory visibility on the website in terms of product quantity and location so that they can select the best option. Gather information on each customer’s purchase across every channel. Companies can offer advanced service and be competitive in the omnichannel world with a customer profile.
Step 4. Transportation Management System
Using a transportation management system (TMS) within the omnichannel strategy can reduce costs and complexity across the supply chain. In addition, having a TMS can help deliver real-time data messages. For example, the customer and supply chain leaders can follow their package path; when it is shipped, in transit, and if any delays happen on the way. A TMS can also help reallocate inventory in real-time if the package is delayed. As a result, it allows you to figure out the costs of these mistakes and prevent them in the future.
A TMS also provides inbound visibility to store routes, which helps schedule/forecast store labor. This can also help with inventory replenishments from an online distribution center (DC) to store-to-store transfers.
How can an experienced 3PL help?
When choosing between internal logistics assets and working with a 3PL, omnichannel retailers should evaluate the volumes of current and future shipping needs. If volumes continue to increase in the future or a retailer will be adding e-commerce to its services, working with a knowledgeable 3PL provider to customize supply chain management can add tremendous value. 3PLs can provide comprehensive solutions for effective logistics management that will include inventory system consolidation across all channels, allowing retailers to choose where to pick up orders based on the customer’s delivery address and type of delivery. A 3PL will also use the most efficient and cost-effective transportation option for each order.
Let PLS Logistics Services help you!
At PLS Logistics, we offer dependable solutions for your specific shipping needs. From LTL services to specialized freight shipping, we will collaborate with you to advance your logistics and obtain cost-saving results. Our technology increases visibility, and our experts help create more effective supply chain practices for business, both small and large. Contact an expert today.