Profitable Fulfillment Are We There Yet?

Back in January, the folks at Aptos asked us to help them figure out the success retailers are having with cross-channel fulfillment. We all know that many retailers are willing to let customers “have it our way” when it comes to satisfying demand. We also had a feeling that it might be working, but it likely wasn’t working all that well.

On the surface, retailers believe their cross-channel fulfillment efforts are profitable. But a slightly deeper look tells us they also recognize they’re leaving a lot of money on the table. Many can’t measure, or wish for measurements that would help them improve their understanding. And when push comes to shove, results seem to vary wildly.

At RSR we often talk about Retail Winners — those whose comparable sales outperform their peers. We often find that their winning is an outcome…of different thought processes, tactics and technology usage. This study was an object lesson in these differences.

  • Retail Winners believe they do a better job of cross-channel fulfillment than their peers, but very few believe their processes are “differentiating”
  • In fact, almost ¾ of Retail Winners believe they can do better. They see a major opportunity to improve the profitability of these operations
  • Retail Winners are far ahead of their counterparts in implementing various cross-channel processes. As one small example: Almost ¾ make store inventory available to customers on-line, vs only ¼ of other retailers. This is likely because they have far more confidence in the accuracy of that inventory.
  • More than half of non-winners cite antiquated systems as a primary barrier to effectiveness (vs. less than a third of winners) yet when asked to point to technologies that are most valued, they seem a bit conflicted. Winners value technology as an enabler far more.

In short, this benchmark is yet another lens into the world of omni-channel retailing and helps explain why even though we seem to be making good time, we’re actually still pretty lost. And as usual, we’ll provide recommendations for improvement, depending on where you’re at today.