{"id":25538,"date":"2021-04-08T11:08:00","date_gmt":"2021-04-08T11:08:00","guid":{"rendered":"https:\/\/www.parcelpending.com\/blog\/leveraging-brick-and-mortar-stores-for-fulfillment\/"},"modified":"2023-04-03T18:38:49","modified_gmt":"2023-04-03T18:38:49","slug":"leveraging-brick-and-mortar-stores-for-fulfillment","status":"publish","type":"post","link":"https:\/\/www.parcelpending.com\/en-ca\/blog\/leveraging-brick-and-mortar-stores-for-fulfillment\/","title":{"rendered":"Leveraging Brick and Mortar Stores for Fulfillment"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">The pandemic upended the <\/span><span style=\"font-weight: 400;\">supply chain<\/span><span style=\"font-weight: 400;\"> for many retailers. Now, <\/span><span style=\"font-weight: 400;\">micro fulfillment<\/span><span style=\"font-weight: 400;\"> centers are emerging to leverage brick and mortar stores for faster, safer, cheaper, and more <\/span><span style=\"font-weight: 400;\">flexible fulfillment<\/span><span style=\"font-weight: 400;\"> options.<\/span><\/p>\n<h2><b>Micro Fulfillment<\/b><b> Defined<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Whereas normal <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\">\/distribution centers are as large as 300,00 square feet located in rural environments, <\/span><span style=\"font-weight: 400;\">micro fulfillment<\/span><span style=\"font-weight: 400;\"> centers are typically 3,000 to 10,000 square feet and located closer to the <\/span><span style=\"font-weight: 400;\">customer<\/span><span style=\"font-weight: 400;\">, cutting down on crucial <\/span><span style=\"font-weight: 400;\">last-mile delivery<\/span><span style=\"font-weight: 400;\"> costs. These centers consist of two parts: a physical structure and a software management system that processes online orders. A recent analysis concluded <\/span><span style=\"font-weight: 400;\">that <\/span><span style=\"font-weight: 400;\">micro fulfillment<\/span><span style=\"font-weight: 400;\"> could reduce <\/span><span style=\"font-weight: 400;\">order<\/span><span style=\"font-weight: 400;\">-related <\/span><span style=\"font-weight: 400;\">costs by as much as 75%<\/span><span style=\"font-weight: 400;\"><sup>1<\/sup><\/span><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The growth of online sales will continue to surge. For grocery retailers, this year is a big one \u2013\u00a0 with grocery sales expected to surpass $100 billion in 2021; for any retailer, it\u2019s important to note that all online sales will hit an estimated $843 billion in the same period<\/span><span style=\"font-weight: 400;\"><sup>2<\/sup><\/span><span style=\"font-weight: 400;\">. As a result, retailers are scrambling to embrace <\/span><span style=\"font-weight: 400;\">flexible fulfillment<\/span><span style=\"font-weight: 400;\"> options. Target, for example, is using its stores as <\/span><span style=\"font-weight: 400;\">warehouse<\/span><span style=\"font-weight: 400;\"> hubs fulfilling approximately 95% of online orders<\/span><span style=\"font-weight: 400;\"><sup>3<\/sup><\/span><span style=\"font-weight: 400;\">. It also just reported booming sales demonstrating that its model is working; sales rose almost 21% in the quarter ending January 30, 2021.<\/span><\/p>\n<h2><b>Technology<\/b><b> as a Competitive Advantage<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">At an underground parking ground in Tel Aviv, Israel, <\/span><span style=\"font-weight: 400;\">technology<\/span><span style=\"font-weight: 400;\"> firm Fabric is demonstrating the efficiency of its rack robots that pick grocery orders for manual packing stations. By implementing an automated micro fulfillment center strategy, Fabric can increase efficiency by picking items, so employees can focus on packing a specific online order. With just 12 employees and 15,000 square feet, robots freely roam this fulfillment center, which typically fills 300 orders per day.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Walmart is now partnering with Fabric to leapfrog competitors with this <\/span><span style=\"font-weight: 400;\">technology<\/span><span style=\"font-weight: 400;\">. While grocery stor<\/span><span style=\"font-weight: 400;\">i<\/span><span style=\"font-weight: 400;\">es are typically limited to picking 100 orders per day, these robots can boost that capacity to 1,000 orders per day<\/span><span style=\"font-weight: 400;\"><sup>4<\/sup><\/span><span style=\"font-weight: 400;\">! <\/span><span style=\"font-weight: 400;\">John Furner, Walmart U.S. President and CEO, in Walmart\u2019s earnings call Feb. 18, said the <\/span><span style=\"font-weight: 400;\">retailer<\/span><span style=\"font-weight: 400;\"> expects to have over 100 local <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\"> centers in operation \u201cwithin the next couple of years.\u201d<\/span><span style=\"font-weight: 400;\">\u00a0<\/span><\/p>\n<h2><b>Turning On The Lights In <\/b><b>Dark Stores<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">A new <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\"> option has also arrived in the form of \u201c<\/span><span style=\"font-weight: 400;\">dark stores<\/span><span style=\"font-weight: 400;\">\u201d &#8211; no customers allowed. Amazon is negotiating with Simons Property Group to take over the <\/span><span style=\"font-weight: 400;\">retail<\/span><span style=\"font-weight: 400;\"> spaces formerly occupied by Sears and J.C. Penney, both of which have filed for bankruptcy<\/span><span style=\"font-weight: 400;\"><sup>5<\/sup><\/span><span style=\"font-weight: 400;\">. Two of Macy\u2019s stores were also transformed into what is known as a dark store \u2013\u00a0 a <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\"> center <\/span><span style=\"font-weight: 400;\">where they process online orders and returns rather than a place for customers to browse and shop.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Turning these spaces into <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\"> and <\/span><span style=\"font-weight: 400;\">warehouse<\/span><span style=\"font-weight: 400;\"> automation centers allow behemoth retailers and e-tailers to place distribution centers in the middle of cities (and closer to customers) that typically prohibit new construction.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">For more information on this and other industry terms like <a href=\"\/en-ca\/blog\/click-collect-curbside-pick-up-vs-bopil\" target=\"_blank\" rel=\"noopener noreferrer\">click &amp; collect<\/a> or <a href=\"\/en-ca\/blog\/what-is-bopis-in-retail\" target=\"_blank\" rel=\"noopener noreferrer\">BOPIS<\/a>, check out the detailed overviews linked here.<\/span><\/p>\n<h2><b>Lightning-Fast <\/b><b>Delivery<\/b><b> Within Hours<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Customers\u2019 <\/span><span style=\"font-weight: 400;\">demand<\/span><span style=\"font-weight: 400;\"> for <\/span><span style=\"font-weight: 400;\">delivery options<\/span><span style=\"font-weight: 400;\"> is at an all-time high. According to a recent survey SmartBrief conducted with IDC, consumers are basing their decisions on where to shop based on services like buy online, pick up in-<\/span><span style=\"font-weight: 400;\">store<\/span><span style=\"font-weight: 400;\"> (BOPIS); curbside\/drive-up pickup; and omnichannel return options<\/span><span style=\"font-weight: 400;\"><sup>6<\/sup><\/span><span style=\"font-weight: 400;\">. <\/span><span style=\"font-weight: 400;\">By employing micro fulfillment sites, retailers are slashing <\/span><span style=\"font-weight: 400;\">delivery<\/span><span style=\"font-weight: 400;\"> times for online orders allowing products to reach customers in just a few hours versus a day. <\/span><span style=\"font-weight: 400;\">In short, <\/span><span style=\"font-weight: 400;\">flexible fulfillment<\/span><span style=\"font-weight: 400;\"> options matter.\u00a0<\/span><\/p>\n<h2><b>How Lockers Support <\/b><b>Micro Fulfillment<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Curbside pick-up, BOPIS (Buy Online, Pick Up In-<\/span><span style=\"font-weight: 400;\">Store<\/span><span style=\"font-weight: 400;\">), and BOPIL (Buy Online, Pick-up in Locker), all play major roles in the race for <\/span><span style=\"font-weight: 400;\">customer<\/span><span style=\"font-weight: 400;\"> satisfaction and loyalty. However, when comparing these three different <\/span><span style=\"font-weight: 400;\">fulfillment<\/span><span style=\"font-weight: 400;\"> options, it\u2019s clear why BOPIL overwhelmingly wins.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Store<\/span><span style=\"font-weight: 400;\"> employees must take the time to deliver orders directly to the <\/span><span style=\"font-weight: 400;\">customer<\/span><span style=\"font-weight: 400;\"> with curbside collection. With BOPIS, it\u2019s the <\/span><span style=\"font-weight: 400;\">customer<\/span><span style=\"font-weight: 400;\"> who must take the time to park, walk into the <\/span><span style=\"font-weight: 400;\">store<\/span><span style=\"font-weight: 400;\">, and potentially wait for a <\/span><span style=\"font-weight: 400;\">store<\/span><span style=\"font-weight: 400;\"> employee to deliver the <\/span><span style=\"font-weight: 400;\">order<\/span><span style=\"font-weight: 400;\">. With BOPIL, however, customers retrieve their orders at their convenience typically without any wait times.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Customers who wait under 2 minutes for their <\/span><span style=\"font-weight: 400;\">order<\/span><span style=\"font-weight: 400;\"> pick-up are four times more likely to repeat purchase from the same <\/span><span style=\"font-weight: 400;\">retailer<\/span><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Moreover, <\/span><span style=\"font-weight: 400;\">retailers that employ BOPIL saved an average of<\/span><a href=\"\/en-ca\/blog\/omnichannel-retail-strategy-bringing-online-shoppers-to-brick-mortar-stores\/\" target=\"_blank\" rel=\"noopener noreferrer\"> <span style=\"font-weight: 400;\">45 hours<\/span><\/a><span style=\"font-weight: 400;\"> per month versus managing BOPIS orders<\/span><span style=\"font-weight: 400;\"><sup>7<\/sup><\/span><span style=\"font-weight: 400;\">. <\/span><span style=\"font-weight: 400;\">Most importantly, with BOPIL, a whopping 61% of customers make an incremental purchase just by virtue of entering the <\/span><span style=\"font-weight: 400;\">store<\/span><span style=\"font-weight: 400;\">!<\/span><\/p>\n<h2><b>BORIS (Buy Online, Return In-Store) Made Easy<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Easy returns also influence <\/span><span style=\"font-weight: 400;\">customer<\/span><span style=\"font-weight: 400;\"> satisfaction and loyalty. <\/span><span style=\"font-weight: 400;\">92% of consumers surveyed said that they will buy again if the product return process is easy<\/span><span style=\"font-weight: 400;\"><sup>8<\/sup><\/span><span style=\"font-weight: 400;\">. <\/span><span style=\"font-weight: 400;\">If customers collect their <\/span><span style=\"font-weight: 400;\">order<\/span><span style=\"font-weight: 400;\"> via BOPIL and decide not to keep it for whatever reason, they are able to communicate with the <\/span><span style=\"font-weight: 400;\">retailer<\/span><span style=\"font-weight: 400;\"> and place it back in the locker within two minutes for an easy return. By contrast, curbside collection requires customers to enter the <\/span><span style=\"font-weight: 400;\">store<\/span><span style=\"font-weight: 400;\">, perhaps stand in line, and deal with an employee to issue a return. Alternatively, customers may ship the item back to the <\/span><span style=\"font-weight: 400;\">retailer<\/span><span style=\"font-weight: 400;\">, often at their own expense.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Fulfilling online orders has become the new battleground for retailers looking to win new customers and is one of the most important <a href=\"\/en-ca\/blog\/omnichannel-trends-for-2021\" target=\"_blank\" rel=\"noopener noreferrer\">omnichannel trends<\/a> in retail. Whereas next-day delivery was the gold standard for retailers, today\u2019s customers want their orders safely and immediately. Waiting at the curb or entering a store decreases consumer satisfaction\u2026and sales.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">To discuss how BOPIL can work for you and your business, <\/span><a href=\"https:\/\/www.parcelpending.com\/en-ca\/markets\/retail-parcel-lockers\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">contact a Parcel Pending sales representative today<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/p>\n<p><b>Sources:<\/b><\/p>\n<ol>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Devanesan, Jon. TechHQ. <\/span><i><span style=\"font-weight: 400;\">Retailers turn to the micro fulfillment center to keep supply chains flowing<\/span><\/i><span style=\"font-weight: 400;\">. (2021, February 22). <\/span><a href=\"https:\/\/techhq.com\/2021\/02\/retailers-turn-to-the-micro-fulfillment-center-to-keep-supply-chains-flowing\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/techhq.com\/2021\/02\/retailers-turn-to-the-micro-fulfillment-center-to-keep-supply-chains-flowing\/<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Davis, Sarah &amp; Toney, Lauren. ROI Revolution. <\/span><i><span style=\"font-weight: 400;\">How Coronavirus (COVID-19) Is Impacting Ecommerce [March 2021]<\/span><\/i><span style=\"font-weight: 400;\">. (2021, March 12). <\/span><a href=\"https:\/\/www.roirevolution.com\/blog\/2021\/03\/coronavirus-and-ecommerce\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.roirevolution.com\/blog\/2021\/03\/coronavirus-and-ecommerce\/<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Nassauer, Sarah. The Wall Street Journal. <\/span><i><span style=\"font-weight: 400;\">Target Boosts Growth During Covid-19 Pandemic, at Rivals\u2019 Expense<\/span><\/i><span style=\"font-weight: 400;\">. (2021, March 2). <\/span><a href=\"https:\/\/www.wsj.com\/articles\/pandemic-boosts-targets-growth-at-rivals-expense-11614684877\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.wsj.com\/articles\/pandemic-boosts-targets-growth-at-rivals-expense-11614684877<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Verdon, Joan. Forbes. <\/span><i><span style=\"font-weight: 400;\">Why Amazon Should Be Worried About Walmart\u2019s Micro-Fulfillment Centers<\/span><\/i><span style=\"font-weight: 400;\">. (2021, February 28). <\/span><a href=\"https:\/\/www.forbes.com\/sites\/joanverdon\/2021\/02\/28\/why-amazon-should-be-worried-about-walmarts-micro-fulfillment-centers\/?sh=2035db315870\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.forbes.com\/sites\/joanverdon\/2021\/02\/28\/why-amazon-should-be-worried-about-walmarts-micro-fulfillment-centers\/?sh=2035db315870<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Fung, Esther &amp; Herrera, Sebastian. The Wall Street Journal. <\/span><i><span style=\"font-weight: 400;\">Amazon and Mall Operator Look at Turning Sears, J.C. Penney Stores Into Fulfillment Centers<\/span><\/i><span style=\"font-weight: 400;\">. (2020, August 9). <\/span><a href=\"https:\/\/www.wsj.com\/articles\/amazon-and-giant-mall-operator-look-at-turning-sears-j-c-penney-stores-into-fulfillment-centers-11596992863\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.wsj.com\/articles\/amazon-and-giant-mall-operator-look-at-turning-sears-j-c-penney-stores-into-fulfillment-centers-11596992863<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Harris, Shawn. TotalRetail. <\/span><i><span style=\"font-weight: 400;\">3 Ways Retailers Can Thrive Coming Out of COVID-19<\/span><\/i><span style=\"font-weight: 400;\">. (2021, March 2). <\/span><a href=\"https:\/\/www.mytotalretail.com\/article\/3-ways-retailers-can-thrive-coming-out-of-covid-19\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.mytotalretail.com\/article\/3-ways-retailers-can-thrive-coming-out-of-covid-19\/<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Reidel, Kate. Parcel Pending. <\/span><i><span style=\"font-weight: 400;\">Omnichannel Retail Strategy: Bringing Online Shoppers to Brick &amp; Mortar Stores<\/span><\/i><span style=\"font-weight: 400;\">. (2020, June 1). <\/span><a href=\"\/en-ca\/blog\/omnichannel-retail-strategy-bringing-online-shoppers-to-brick-mortar-stores\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">\/en-ca\/blog\/omnichannel-retail-strategy-bringing-online-shoppers-to-brick-mortar-stores\/<\/span><\/a><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Saleh, Khalid. Invesp. <\/span><i><span style=\"font-weight: 400;\">E-commerce Product Return Rate \u2013 Statistics &amp; Trends [Infographic]<\/span><\/i><span style=\"font-weight: 400;\">. (2020, April 11). <\/span><a href=\"https:\/\/www.invespcro.com\/blog\/ecommerce-product-return-rate-statistics\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span style=\"font-weight: 400;\">https:\/\/www.invespcro.com\/blog\/ecommerce-product-return-rate-statistics\/<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0<\/span><\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"<p>The pandemic upended the supply chain for many retailers. Now, micro fulfillment centers are emerging to leverage brick and mortar stores for faster, safer, cheaper, and more flexible fulfillment options. Micro Fulfillment Defined Whereas normal fulfillment\/distribution centers are as large as 300,00 square feet located in rural environments, micro fulfillment centers are typically 3,000 to [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":25539,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[324],"tags":[],"class_list":["post-25538","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog-retail-en-ca"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.2 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Leveraging Brick and Mortar Stores for Micro Fulfillment | Parcel Pending<\/title>\n<meta name=\"description\" content=\"Retailers are embracing micro fulfillment stores to leverage brick-and-mortar stores for faster, safer, cheaper, and more flexible fulfillment options.\" 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