7 Ways that Omnichannel Fulfillment Turbocharges Capacity


Omnichannel fulfillment is becoming a hot topic in ecommerce. Today's online customers want it all—and they want it fast. Consumers want the same service and speed whether they place an order online, through a website, mobile app, social media, or a physical store. With more and more customers moving across channels, it's hard to meet rising capacity challenges.

Integrating Systems across Channels Offers New Opportunities

Omnichannel retailers are often constrained by legacy systems and traditional operations that isolate channels. That's why retailers are leveraging new technologies that integrate fulfillment operations across channels, offering new opportunities to:    

  • Maintain consistent experiences across all channels

  • Meet growing capacity needs while maintaining flexibility

  • Match Amazon's Prime delivery promises

  • Handle multiple distribution methods smoothly--including manage store-to-customer, customer-to-store, warehouse-to-store, warehouse-to-customer, and store-to-store deliveries

  • Reduce costs

Retailers are looking for solutions to the new complexities of the marketplace. They know customers will go elsewhere if they don't rise to the occasion. That's where omnichannel fulfillment comes in.

Omnichannel fulfillment is a Holistic Approach to Fulfillment

How should we define omnichannel fulfillment? We can start by saying that it is a holistic approach that streamlines the entire order fulfillment process—including receiving, warehousing, pick-and-pack, shipment, and returns—across all channels.

The essence of omnichannel fulfillment is that all inventory is placed in a single shared pot with localized last-mile delivery. These elements enable retailers the flexibility to create integrated, pinpointed strategies for inventory, warehousing, redistribution and allocation, pick-and-pack, store operations, distribution, and other key processes.

Omnichannel fulfillment is proving to be a winning strategy for retailers nationwide and around the globe. Let's look at some common ecommerce challenges and how omnichannel fulfillment provides answers.

Challenge 1. Efficiency

Speed isn't the only efficiency-related issue. Related capabilities include inventory accuracy; accounting for order variability and predictability; determining warehouse space and workflow; picking-and-packing operations, and handling.

Omni-Channel Solution: Warehouse operations are optimized by integrating orders with changing inventory needs, supply chain, warehouse space allocation, and shipping/handling.

Challenge 2. Inventory Accuracy

Supply chain gaps and lack of visibility can cause inaccuracies that mislead customers about product availability, such as incorrect "out of stock" status or delivery delays. 

Omni-Channel Solution: Inventory Management increases visibility, helps forecast demand to better plan supply chain activities accordingly and adjusts product inventory needs.

Challenge 3. Cost-Effectiveness

Most omnichannel retailers struggle to reduce costs in hard-to-predict areas such as warehousing, labor, shipping to a distribution hub, last-mile delivery, and return operations.

Omni-channel solution: The retailer sees cost-to-serve factors in greater detail, helping to predict fulfillment costs better and choose a last-mile path based on the preferred balance of speed and cost.  

Challenge 4. Speed

Speedy, No-cost, Reliable Delivery

To be competitive, retailers are struggling to match Amazon, especially Amazon Prime, by delivering Same-day or one-to-day delivery with no shipping costs.

Omni-channel solution: Better inventory tracking, efficient warehouse operations, and optimizing last-mile path helps retailers avoid delays, speed delivery, and delivery at the time promised to customers.

Challenge 5: Handling Returns

Return rates of goods purchased online are commonly between 30 to 40 percent. Poor return handling can result in lost inventory, negative customer experience, and significantly reduced profits.

Omni-Channel solution: Integrating returns into the supply chain creates a smooth process that reduces lost inventory, improves customer experience and branding, and increases revenue.

Challenge 6: Demand volatility and forecasting accuracy

Rapid shifts or changing trends in consumer behaviors and demand patterns are inevitable and exacerbated by external events such as the pandemic and weather events.    

Omni- channel Solution: Deep machine learning and AI capabilities help improve forecasting, respond to shifting demand and potential supply chain disruptions, pivot quickly, and remain agile.

Challenge 7. Agility/Mitigate disruptions

Traditional, centralized fulfillment operations are vulnerable to flow disruptions in the supply chain, facility capacity, transportation, stock build-up, and automation failure, and other areas.

Omnichannel solution: Improved visibility into inventory, operational flexibility, and agility makes the fulfillment system more resilient and shock-proof.

Holistic Omnichannel Fulfillment Drives E-Commerce Success

Customers are demanding and fickle—and have more choices than ever. At the same time, omnichannel retailers face complex challenges in a competitive marketplace. How can retailers meet customer expectations? Omnichannel fulfillment systems provide new ways to holistically integrate all dimensions of the fulfillment process for greater efficiency, profitability, and a consistent customer experience across all channels. Nextuple's innovative technology unlocks the potential of omnichannel fulfillment.

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