Without robust omnichannel programs, retailers have less assortment, sell less of their inventory, and offer much less customer choice. All of which translates into lower growth and revenue. And yet building a scalable omnichannel program is a labyrinth of financial, technical, and multi-team challenges that can quickly turn into a money-pit with little or no growth to show for it.
Agile retailers are moving fast as they accelerate ecommerce to make up for low in-store sales. But speed comes with its own growing pains. New processes and fulfillment teams are causing late shipments, cancelled orders, fulfillment mistakes, and difficulties handling customer service requests. In other words, a perfect storm for losing customers to Amazon.
Many companies are struggling to keep up with higher consumer expectations around shipping. If a retailer or brand can’t deliver products within two days, customers will just hop over to another retailer or marketplace that can (ahem, Amazon). And the window is growing even tighter as next-day shipping becomes the norm. All of which means lots of companies are facing the stark choice of either squeezing margins further to improve delivery times or disappointing their customers.
A lot of retailers focus their energies on either store-based fulfillment or drop ship for increasing online inventory assortment. At first glance this makes sense. Companies only have so much money to invest in their supply chain and they need to choose fulfillment strategies that work best for their business goals.
If you’re like a lot of our retail partners you hate being unable to fulfill an order due to limited cross-channel inventory visibility. You also find it frustrating that different channels can’t access the same assortments, leading to higher opportunity and shipping costs. And though you wish there was a way to offer faster shipping, your legacy solutions are unable to efficiently route orders to inventory locations closer to customers.
Top retailers are competing to understand what drives their clients’ behavior from awareness to purchase. The proliferation of big data and high volume of omnichannel purchasing makes the type of technology described above achievable.
In short, omnichannel is becoming more critical now than ever.
I Asked Over 200 Enterprise Brands What They Got Out of Drop Shipping–Their Answers Might Surprise You
For retailers, the benefits of drop shipping are obvious. It allows them to easily offer a wider assortment of products at retail prices while shifting much of the costs and risks associated with warehousing inventory back up the supply chain.
Instead of a threat, drop shipping should be seen as a vital opportunity for brands to make the necessary pick, pack, and ship investments to take advantage of this growth.
Check Out Our Guest Post on Shippo’s blog: Five Most Important Metrics for Monitoring Supply Partner Performance
Read the full post here.