Home FAQ: Retail Ship-from-Store

FAQ: Retail Ship-from-Store

This is an archived post from OrderDynamics, now Tecsys retail division.
FAQ: Retail Ship-from-Store For this post, we answer frequently asked questions that have come from readers and Google search queries around Retail Ship-from Store. Retail ship-from-store is a smart way retail chains can fulfill customer orders. Whether it is a free shipping order or not, using in-store inventory helps optimize supply chains. Using store merchandise for more sales improves inventory turnover at the store level. This, in turn, takes the pressure off individual stores in terms of mark-downs. When inventory velocity is high, there are fewer season-end goods left that need to be discounted. Furthermore, if the organization credits the store for the orders processed, store management will be fully engaged. Ultimately, this technique better leverages the supply chain's full set of assets. That means store inventory is not left idle, while warehouse inventory fulfills online orders. It also engages all associates in an omnichannel retail strategy, helping to break silos and truly make the customer buying journey a seamless one.

Q: Why is Retail Ship-from-Store Important?

Retail ship-from-store is a critical part of truly engaging all of a merchant's resources. The retail ship-from-store model is all about using the inventory you have closest to the customer, to complete an order. In other words, physical retail stores can engage in the benefits of fulfilling online orders. Store fulfillment means you improve store inventory turnover. It also engages associates in sales/fulfillment. This approach gives credit to the shop and uses stock that is closer to the shopper to fulfill (lower shipping costs).  All told, it is an important step to developing an omnichannel strategy that works and takes root with a merchant's chain. For more depth, read: What Exactly is Pick, Pack and Ship from Store? How to 'Ship-From-Store' - the Right Strategy!

Q: What Advantages do Customers Get From Retail Ship-from-Store?

Smart retailers will try to personalize or include an added touch to items shipped from a store location. For example, include a small card sent from the person who did the pick, pack then ship function, at the store with a personalized message like, "Please drop by our nearby store to check out a jacket that looks great with this combo. When you stop-in make sure to say hello - 'Chris'." Sometimes these little human added touches can boost that sense of personal connection with customers. Aside from these personal touches, shoppers should not be able to tell if it came from physical stores or a distribution center. Omnichannel retailing is all about making the process seamless, and the background work transparent to shoppers. Your program must make the fulfillment process invisible to the shopper. That's what distinguishes a great retail ship-from-store process.

Q: Is Retail Ship-from-Store Growing?

Anecdotally speaking, the answer is yes. Retail executives understand the benefit of using brick and mortar store inventory. It lets merchants set up some stores as fulfillment centers. This uses field stock, meaning a retailer can hold less inventory for similar sales levels. Also, on average stores are closer to the customer destination, so delivery times will be shorter.  Which means more merchandise will be sold at full price. With increased inventory turnover, there is less pressure to discount left-over products at the end of the season.

Q: Does Retail Ship-from-Store Count as an Omnichannel Strategy?

Yes. Traditional retail practices keep all elements within the channel. For example, online sales are always shipped from the warehouse. In-store purchases are always fulfilled from store inventory, or the distribution center when out of stock. There was never the cross over of a voice-commerce order routed to a store for fulfillment (either shipped or for in-store pickup) for example. Given retail ship-from-store can be completed for either in-store or digital orders, it is an omni-channel technique and practice.

Q: How Can I Deal With the Pick-Pack in the Store?

Pick-pack-ship is the standard procedure at any warehouse. Distribution centers are built for this. But a store is not. Well - that is, until now. Good distributed order management systems give you pick, pack, verify and ship workflow tools for your associates. The OrderDynamics system, for example, provides this on a tablet or smartphone. Otherwise, just print off the pick-pack list. This workflow should also update the shop inventory, and provides verification data that the goods have been selected. In effect, it helps store managers ensure the orders are processed right. Read more about this at: Store Managers: Ready for Batch Pick, Pack and Ship?

Q: Will Retail Ship-from-Store Work for a Franchise Business?

Yes. In fact, it is ideal for a franchise retailer. One of the contentious questions in a franchise business is where does the online order go? All franchisees would like to see these orders routed to stores, to leverage the inventory they have. This way the entire business is working in unison. The franchisees appreciate the higher inventory turnover by completing online orders. It also means their stores are partaking in the online success of the company, as they should. A recent ICSC study concluded that it is not only brick and mortar stores that benefit from a co-operative omnichannel selling approach. Customer experiences in-store, and the option of day shipping (stores are closer to customers) - help the brand. Helping the brand, impacts online sales. In this light, the franchisees should partake and benefit from their respective share of online orders. Martin Chartrand, IT Director at Source for Sports adds that: "For us and for many franchise organizations the challenge of fulfilling from store is attribution of the sale.  Making sure that the store gets credit for the sale. Setting up a payment gateway for each fulfilment location supports this well.  This way the store that owns the inventory gets the funds deposited for the sale. The bonus is that there is no extra accounting or attribution done behind the scenes." In this light, Source for Sports is a great example of a franchise retail chain already leveraging retail ship-from-store, effectively.

Q: How can you Tell if a Merchant is Fulfilling Retail Ship-from-Store Orders?

There is no easy way to determine this. Merchants can make the process completely invisible to consumers. In other words, they can make orders that come from stores look and seem exactly like those shipped from a distribution center. On the other hand, retailers may want customers to know that it came from a store near them. In fact, the smart thing for a chain to do is exactly this. They should include a personal note from the associate who picked, packed and shipped the items from the store. Ideally, the note might even invite the customer to come into the local store sometime to shop for other goods, or to meet the associate who put together their order. This form of engagement can help retailers increase foot traffic and add-on sales. Otherwise, you can also go into a store and ask the staff. :)

More Questions

Did we answer your questions in this FAQ post? If not, please share them with us. We are always happy to ponder a tough question about retail, omnichannel retail and order management. Simply send us a message at info@orderdynamics.com.   Author: Sarah McMullin is the Director of Product at OrderDynamics. With over a decade of experience in emerging technologies, her work has taken her around the world— from innovating with global luxury retailers, to crowdsourcing DNA to fight food fraud, to creating new Things and making them speak. Her constant focus has been on launching new products that solve real-world problems. Prior to working at OrderDynamics, Sarah held a series of positions within product management and marketing at various firms including Tulip Retail, SAP, Sybase, and NCR. Sarah graduated from the University of Waterloo with an Honours Bachelor of Mathematics degree. She also holds a Master of Business Administration from Wilfrid Laurier University.
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