How to Keep Up with Growing Omnichannel Fulfillment Demands
Companies that offer an omnichannel fulfillment that optimizes packaging and shipping products from multiple sources are the ones that will rise to the top.
With consumers eager to get back to normal as the economy recovers from COVID-19, the U.S. retail market looks to be poised for growth. But over the last year, the landscape for retail has changed dramatically. While many brick and mortar stores closed, e-commerce became the defacto purchasing channel for many consumers. The pandemic changed customer expectations of retail in a big way, and those changes aren’t going away any time soon.
With consumers increasingly demanding more ways to shop, more options for store pickup, and faster ship times, companies that want to stay competitive — or even gain a competitive edge — need to find ways to make their fulfillment operations as flexible as possible to get products in the hands of customers as quickly and efficiently as they can. The solution for many brands was turning to an idea that was just starting to pick up steam pre-pandemic: omnichannel fulfillment.
What Is Omnichannel Fulfillment?
It’s not uncommon for companies to have product inventory across multiple sites, from distribution centers to manufacturing facilities, which makes omnichannel fulfillment an essential strategy to ensure products arrive to customers in the fastest and most efficient way possible. It also introduces new challenges to overcome — the need for complex logistics, improved protective packaging to ensure product survival as it’s being juggled between locations, and better internal communications.
The “omni” in omnichannel is a signifier— it means that retail products are stored, packaged, and shipped in multiple locations depending on the scale and capabilities of the distribution centers and brick-and-mortar stores that sell them. There are a few key types of omnichannel fulfillment:
- Ship from 3PL
- Ship from distribution center
- Ship from store (a type of micro-fulfillment)
- Ship to store (for in store pickup)
Leveraging the power of omnichannel fulfillment means being in tune with the needs of your customer base and knowing your business’ capabilities inside and out.
Ship From 3PL
On a daily basis, a third-party logistics provider works with companies to help them manage product procurement as well as fulfillment centers. This makes them an extremely effective tool for those shipping from multiple locations.
For example, a mid-size e-commerce company that’s growing quickly might need to scale up their logistics operations. Rather than look for a larger warehouse space or build a distribution center in another geographic region, a 3PL can help them scale and move into new geographic regions faster and more efficiently.
The use of 3PLs is already popular — research shows that 90 percent of domestic Fortune 500 companies use their services, and the benefits of using one are obvious. Working with a third-party logistics provider allows companies to focus on what they do best — creating products — and leave the complicated logistics to someone else. And while using an outside party gives companies less control over the shipping and processing of their products, leveraging a 3PL is still an effective tool to help brands be more efficient and streamlined by outsourcing their logistics. Third-party logistics providers can also help companies keep up with increasing order fulfillment, ensuring that items get to customers on time and overall satisfaction remains high.
One way that brands can mitigate potential quality control issues is to work with a 3PL partner that leverages resources and insights from a trusted packaging expert. Pregis works with a range of 3PLs to ensure that every product shipped arrives intact and in great condition. Whether that means designing the perfect customized shipping solution or providing high-quality packaging products in the void fill, cushioning, and containment space, working with a 3PL that has high-quality partners will ensure your product is shipped in high-quality materials.
Ship From Distribution Center
Larger retailers with multiple locations across various geographic regions typically use company-owned distribution centers to fulfill orders. A distribution center is a place for companies to store products for processing and shipping to match customer demand.
These centers are especially helpful to process large amounts of orders at a rapid pace — it’s the reason why you’ll see large retailers like Safeway and Bed Bath & Beyond use them so often. Many of these businesses have both brick-and-mortar and e-commerce operations, so dedicated distribution centers are critical to managing the complexities of keeping physical stores stocked with merchandise while also shipping products directly to customers.
Those with the space and resources to optimize their shipping processes at a distribution center can often benefit heavily from automation. Automation is most useful when companies are shipping high volumes of similar products. Being able to leverage automation technology can significantly increase throughput while minimizing labor costs and human error.
Pregis offers such automation capabilities with its Sharp automated packaging systems, which has scanning and sealing capabilities and can handle packaging needs of different scales and sizes. Brands can also benefit from leveraging Pregis customizable and efficient polybags, which allow for shipping labels and brand imaging to be printed directly on the bag.
Micro-fulfillment or Ship From Store
Micro-fulfillment, otherwise known as a ship-from-store approach, is an increasingly popular method for increasing efficiency. Through localized shipping, retailers can save on costs and even potentially pass these savings on to customers. For example, last year, Macy’s recently set up two “dark stores” designed solely for fulfillment, and Whole Foods has taken a similar approach to meet delivery demand.
And while these centers may be small, they still have muscle — some micro-fulfillment operations can handle up to 4,000 orders per week. However, because these are smaller centers, it takes time and a continued investment to set up a strong micro-fulfillment infrastructure.
Since a micro-fulfillment approach involves less flexibility compared to a larger distribution center, establishing sound economic practices is especially important. To achieve these goals, smaller machines, like Pregis’ Mini Pak’R® or AirSpeed® Smart designed to fit in spaces with limited capacity, are best for a center to get the most out of its shipping and packaging capabilities. Both machines are extremely versatile and can package consumables at an accelerated rate to help increase throughput in smaller packing environments. When there’s less space to work with, it’s all about knowing your limits and capabilities — and designing a system that works to maximize productivity without sacrificing quality.
Ship to Store
A ship to store approach is one designed with customer satisfaction in mind. Also known as a BOPIS (Buy Online Pickup In Store) solution, ship to store is a way for retailers to engage their internal delivery networks and quickly prepare products for customer pick-up. Picking up an online order directly at a store is always convenient, but it can cause headaches for retailers arranging this transaction in regard to store inventory and correctly fulfilling orders. A BOPIS model has proven successful for businesses like PETCO and Dollar General, which have increased sales figures through ship-to-store implementation.
Shipping to a store also relies on choosing the right packaging equipment and avoiding surplus weight and handling charges. For shippers looking to fulfill many orders and get them to their stores on time, Pregis’ EasyPack® paper void fill system is designed to support high volume operations.
As a sustainable solution, Easypack® uses 100 percent recycled paper. The material, which can be recycled curbside, is perfect for packing large daily order quantities. Plus, it doesn’t take up too much space in a facility for shippers looking to be economical with their packing. It also helps reduce DIM weight during the packaging process, so businesses can avoid surcharges.
A True Omnichannel Fulfillment Experience
Creating omnichannel fulfillment systems is always going to be a work in progress. There’s never going to be an end point — businesses will always have gaps to fill and places to improve. But that’s what makes the possibilities omnichannel fulfillment offers so exciting. In the game of customer satisfaction, too much is never enough. In the end, that’s what omnichannel fulfillment is all about — figuring out how to best produce, package, and ship to make sure that when a product reaches a customer, they come back to start the process all over again.
Want to learn more about how Pregis can help your business level up its omnichannel fulfillment capabilities?