3. Increased sustainability
Fulfillment by store reduces packing cost and waste when compared to shipments from a fulfillment center or centralized location. Retailers can reduce waste generated from packaging fill, boxing, and potential transportation costs, by utilizing store-based packaging similar to an in-store shopping experience, while optimizing for batching and routed next-day deliveries.
4. Improved operational efficiencies
Retailers can optimize inventory placement throughout the network, by placing localized SKU’s closest to the target end customer. For example, a clothing retailer can place warm weather SKU’s closer to the customers most likely to buy them based on location and seasonality. This strategy increases localized availability while optimizing local inventory storage and dwell time, protecting precious retail space. In this case, SFS technology determines which location(s) can fulfill the customer’s orders with the least amount of shipments based on inventory availability and cost.
Considerations before implementation
Before a retailer can take on a fulfillment from stores approach, they should review their eCommerce and last-mile delivery strategy and determine if their current strategy and processes are a fit for this approach. Additional costs related to the SFS model include technology, software, labor, and space. This could be challenging for smaller or mid-size businesses with limited staff and budgets. Retailers may benefit from partnering with a third-party delivery service provider that can consult on important considerations like a central distributed order management system, tools for order picking and packing, staff training to execute online order fulfillment, routing logic, how to leverage stores more efficiently for order fulfillment, delivery promise / customer SLAs, and more.
The retail industry is embracing an omnichannel strategy as a way to personalize the customer shopping experience, build brand loyalty, and grow customer lifetime value. Data from omnichannel helps enable store fulfillment, lower costs, and reduce retailers’ environmental footprint. To make that ongoing shift, retailers need to maximize the use of their physical store footprint alongside their online presence and may consider deploying a fulfillment from stores approach. And with a strong eCommerce, last-mile delivery and fulfillment strategy in place, retailers and their DSPs are increasing their chances for profitable success. We on the Walmart GoLocal team would love to discuss whether store fulfillment is right for your business. Contact us today to learn more.