Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.
Some repercussions of omnichannel’s impact on stores can be predicted and others you have to live through. The challenge of finding storage for cross-channel orders — whether click & collect or ship store — is one of the latter. Especially when you’re talking about big-box retailers or retailers in strip malls rather than indoor malls, click & collect is only growing. Unsurprisingly, this holiday season is expected to be the highest volume click & collect ever. And next year probably will be too.
In stores, systems that were designed as temporary stop-gap fixes are becoming overwhelmed by the order volume. Orders have to be stored in the back room because there’s no room to store them near the front of the store. Items are getting dropped or lost. Pickup counters go unstaffed because labor has not been realigned for the new reality. Customers are waiting and unhappy. Employees are running all over the place in highly inefficient processes that save the sale, but bleed profits.
Ironically, this may mean retailers are finally focusing their attention on two major investments for stores: remodels and employee technology. Retailers have only been talking about the need for these improvements forever, because they’ve known since the first consumer mobile phone entered the store that employees were going to end up on the losing side of that proposition.
If click & collect is the killer business case that supports adequate investments in employee handhelds, great. Just don’t forget all those other business cases waiting in line behind it, which didn’t have enough power on their own to compel the investment.
But we’re getting more glimpses of the store of the future. A recent visit to a Best Buy showed the entire front quarter of the store, normally reserved for cash registers, was closed. All purchase traffic was being routed to the online pickup desk — even cash & carry sales. In the meantime, the storage room for online orders was stuffed to the gills. That’s going to have to change.
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