Part II. Six Steps to Engineer a More Efficient and Effective Omnichannel Process

by | Jun 12, 2020

As demonstrated in last week’s blog, retail omnichannel strategies have come a long way in the past several years, if not months. In the early days, borrowing from the restaurant “Take Out” playbook, grocers started introducing “Click & Collect” services. The practice of buying online and picking up in-store (often called “BOPIS” or sometimes “BOPUS”) is well-adopted across retail, but it’s not alone. From BOSS (Buy Online Ship to Store), BHPT (Buy Here Pickup There), BORIS (Buy Online Return In-Store), and now BOPAC (Buy Online Pickup at Curbside), the list of services (and acronyms to describe them) continues to grow. The bottom line is this: whether customers are picking up goods in a store, on the curb, from a locker, or on their doorstep, the line between brick and mortar and online is blurrier than ever. 

Whether your stores have been providing omnichannel services for many years or is just now getting started, it’s worth taking a step back to examine the processes and labor you’ll need to support it. Remember, the difference between a good and bad omnichannel experience for a customer can usually be boiled down to two key questions: was the order accurate, and was it ready for the customer when they needed it? Making sure these two tasks are done correctly is all about searching, picking, and processing inventory accurately and efficiently. This blog will explore six key considerations that can help your business implement and sustain a successful BOPIS operation while maintaining an appropriate amount of labor spend.  

1. Streamline Order Organization 

Omnichannel orders may be received and reviewed by store associates in numerous ways, including over the phone or voice mail, printed from email or the website, or directly to a handheld device (scan gun or tablet). Depending on your volumes and relative mix of merchandise, orders may either be organized by customer or by department. The key here is leveraging what tools and technology you have in order to help streamline your intake process and quickly organize orders for picking. 

Specific picking and processing software can also be used to organize and group many customer orders to be picked in parallel. This can enable your employees to pick orders for their specific department(s) as opposed to owning the entire order for each customer. In many cases, it will be more efficient if a women’s apparel department employee picks one part of a customer’s order and a lawn and garden employee picks the other portion and the customer’s order is consolidated upon being staged for pickup or delivery. The next two sections will break down how and where this method can be deployed, and where labor can be saved as a result.  

2.  Optimize Fulfillment Travel Time 

Associate travel time can contribute up to one-third of the time spent on order fulfillment, especially in medium to large format stores. However, this figure can swing radically up or down depending on the route that associates choose to take through the store.  

  • For smaller formats or lower volume omnichannel businesses, it is wise to prepare a specific travel route in your mind prior to picking, as it will help reduce excessive travel/walking steps. 
  • For larger formats or higher volume omnichannel businesses, purpose-built picking software has been developed for grocery, big box, and other retail segments that automatically presents an associate with the most efficient travel pattern they should take throughout the store. 

3. Reduce Item Search Time 

Another 15-20% of the fulfillment process is typically made up of searching for product on the shelves near the item’s location. This too can be greatly reduced if those doing the order fulfillment have expertise in the area they are picking, or if not, they are guided to the specific item location. 

  • Some retailers have developed software that provides an image of the product and the exact in-store location (defined as the aisle, section and shelve row if applicable) directly on the tablet. Additionally, some software will also provide multiple item locations throughout the store as well as customer substitutional requests locations if products are out of stock. 
  • Another means to reduce search times is to consolidate multiple orders and pick at a department or zone level within the store.  This will reduce travel time across the store and decrease search time for specific items due to the added experience of each picker in their domain. Picking software can help automate the segmentation of the order but is not required to execute this process. 

4. Dedicate Sorting and Staging Areas 

It’s important to streamline the processing of omnichannel orders without infringing on other parts of your business or the health and safety of your customers. To support this: 

  • BOPIS or BOPAC zones should be assigned for sorting and separating picked items into specific locations, whether by temperature zone (e.g. coolers, freezers, ambient areas), department, or by item size (regular vs. bulk items). 
  • Upon customer arrival or at a predetermined pickup window, items should be sorted and consolidated in a designated area per each customer’s order. If customers are in your stores at the time of BOPIS fulfillment, it’s important to allow customer the right of way first, especially at this time of social distancing
  • Pre-sorting customer orders as part of the picking process can be a significant time-saver for your staging area staff. In this regard, Axsium recommends that most retailers carefully choose the type of cart associates are using during the picking process. 

5. Facilitate Communication and Collaboration 

In order to get the most out of your staff, we recommend that you provide your employees with efficient means of communicating with both customers and other associates during the process.   

  • Internal tools for employees may include headsets and earpieces and should be used for continual collaboration, whether it’s to help with finding employees, identifying item locations, or staffing order pickup requests in a timely manner. 
  • External tools for customer communication such as text messaging, phone calls, or in-app alerts should be applied when the orders are completed and when the customer arrive for pickup. 

6. Avoid Stock-Outs 

Nothing will bring your fulfillment processes to a halt more than a stock-out, so it’s important to invest in the systems and processes that can help you avoid them (or get an early warning that one is about to happen). An Inventory Management System can help achieve this goal in the following ways: 

  • Real-time status. Store inventory levels must be maintained live during picking processes to help avoid multiple order requests for only limited items.  
  • Location tracking. Inventory management systems need to recognize and update all locations including overstock, backstock, and multi-location items. 
  • Identify out-of-stocks. Having multiply employees double-check the store for out-of-stock items is very labor intensive, so this information needs to be updated in a timely matter, not only in the inventory management system but also the customer-facing app and picking software.  

Conclusion 

 Do you know the cost per pick from the start of the order receiving process through to the customer pickup time? Do you know what your overall omnichannel labor costs are and how they compare to others in your industry? Have you adapted your labor models or demand forecasts to account for changes to your process, whether it’s resulted from new technology, expanded services, or the evolution of customer expectations? 

Axsium has helped numerous retailers answer these questions and optimize their omnichannel productivity. Let our expertise help you measure, model, analyze, and sustain your in-store process and ultimately land on better results for customers, employees, and your bottom-line. Reach out to your Axsium representative today to better understand how we can help you, whether it’s benchmarking your omnichannel processes against best practices or helping you develop a full-scale labor model. 

In the meantime, don’t hesitate to reach out to Axsium to explore how we can assist with your specific situation.

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