Leverage your store footprint to compete. That’s what retail analysts have been urging brick-and-mortar retailers to do to keep up with Amazon and other ecommerce giants.
The idea was that retailers could take advantage of inventory already close to the customer to meet their elevated expectations for ultrafast delivery. By fulfilling from the store, the thinking went, retailers could get orders out for home delivery as fast as ecommerce giants could.
That urgency hasn’t gone away. When delivery times are too long, almost half of omnichannel consumers will shop elsewhere, McKinsey research found.
But today, store-based fulfillment isn’t always the fastest or most cost-effective way to meet consumers’ expectations for ultrafast delivery, especially if you’re relying on traditional last-mile shipping channels. Instead, more senders are adding same-day and next-day local delivery from distribution centers (DCs) via crowdsourcing as a channel to meet the growing demand for speedy delivery.
Using gig and platform services allows quick and scalable last-mile delivery options for retailers without taking on the burden of navigating new processes and fixed costs.
The real costs of store-based fulfillment
Fulfilling from the store can seem like a slam dunk: The item a customer wants may be sitting in a store just miles from their home. Why not package it up and send it off to them?
The simple answer: Stores are not warehouses. Fulfilling ecommerce orders from retail stores adds costs and hassle that retailers must consider when deciding their delivery strategy. Consider the following:
- Every additional node in the supply chain adds time and cost to the fulfillment process.
- Receiving, putting away, picking and packing processes take longer in a store. McKinsey found that for most retailers, the cost-per-pick of in-store picking is typically 1.5 to 2 times higher than at distribution and fulfillment centers.
- Plus, stores have limited inventory. Ensuring retail stores stock the right inventory for in-store and online shoppers can be a challenge due to their smaller footprint compared to warehouses, which can house more product volume and variety. That’s especially true for the quick turnaround same-day delivery requires.
- The uptick in demand for in-store ecommerce picking comes as retailers struggle to hire and retain store staff. The wholesale and retail trade sector has the largest share of unfilled jobs, according to the U.S. Chamber of Commerce. The time required to train and deploy store associates to handle ecommerce orders means retailers must hire additional labor for other in-store tasks.
- Stores must set up new spaces, processes and training to ensure associates can take on ecommerce fulfillment. That includes investing in resources to handle the process, like mobile devices and label printers. Retailers must also adjust forecasts and allocations to ensure the right inventory gets where it’s needed to support ecommerce and store demand.
- A tightening economy is increasing pressure on retailers to maximize their store’s productivity per square foot. Meanwhile, many brands are trimming their square footage and devoting more space to experiences. Carving out space to store and stage ecommerce deliveries works against these objectives.
3 advantages of delivering from distribution centers
More retailers are adopting direct delivery from the distribution center as a solution to the challenge of meeting consumers’ increased expectations for same-day and next-day delivery. That’s where Roadie’s crowdsourced delivery platform can help.
Consider these advantages of DC-to-customer fulfillment with Roadie Direct™:
- Reach: Roadie drivers can deliver anywhere within a 75- to 100-mile radius of a senders’ DCs, 3PLs and distribution partner locations, so you don’t need to rely on stock (along with space and labor) at stores within 10 to 15 miles of customers. Instead, Roadie’s broad radius enables senders to combine the efficiency of their warehouse picking and shipping operations with the ability to meet customer expectations for fast delivery to their doorsteps. Choose locations with enough local volume to enable Roadie to create efficient delivery routes, so one driver can make multiple stops.
- Fast setup: Senders can add crowdsourced delivery in weeks with no additional hardware investment and minimal use of space and staff. Integrating the Roadie API into your supply chain software makes it easy to quickly and seamlessly add crowdsourced delivery as another fulfillment channel.
- Opportunity: Being able to quickly and efficiently deliver goods directly from the DC enables senders to give more customers the choice of ultrafast fulfillment — and lets them benefit from the resulting increase in retention and sales. Half of the logistics executives Roadie recently surveyed cited customer expectations and the ability to improve retention as reasons they’re considering same-day delivery. Nearly as many (44%) said the same about the ability to increase sales.
When segmented properly as part of your overall e-commerce delivery strategy, crowdsourcing can improve both the customer experience and reduce costs for last-mile deliveries.
Take the next step with Roadie Direct™ warehouse delivery
Crowdsourcing deploys quickly and makes home delivery from DCs a reliable and efficient way to meet customers’ elevated delivery expectations. Roadie Direct™ excels at crowdsourced delivery from DC to home thanks to the following features:
- Roadie SmartSort™, which installs on existing scanning equipment to enable seamless sorting of orders into batches for pickup by crowdsourced drivers.
- The flexibility to offer customers choice in when and how they get their orders. Senders can be matched with a driver for same-day delivery, or they can schedule next-day pickups.
- Roadie’s network of 200,000+ drivers, which enables senders to reach up to 95% of U.S. households.
- The ability to pre-sort orders into batches for delivery along optimized routes, which streamlines pickups from high-volume locations without sacrificing customer wait times.
Roadie can help retailers answer customer demand with fast, efficient home delivery. Learn more about how to speed up the final mile by delivering on-demand from distribution centers. Contact Roadie today.