Omnichannel is a ‘buzzword’ for the entire retail industry. Every retailer wants to adopt this model, and rightfully so. Omnichannel commerce is a multi-channel approach to sales that provides seamless experience to the customers, whether the client is shopping online or from a store.
Traditionally, products and goods reached consumers after going through clearing and forwarding agents, distributors, and retailers. This approach had a series of problems and therefore e-commerce became the weapon for brands and retailers.
E-commerce companies eliminate the delivery cycle significantly, thus making the entire process less time taking and chaotic. The key players of the sector provide a number of benefits to the sellers, taking charge of the entire supply chain end-to-end.
However, the recent unfavourable situations shook the retail industry and now brands are looking at digital business models more holistically than ever before. With the sudden rise in online shopping and fewer customers in stores, retailers have realised that they require more agility to meet the demands. They are moving from brick and mortar to customer-centric, data-backed business models.
Impact on logistics
Today’s consumer is tech-savvy. They expect to find the products both in stores and online, to make purchases with the swipe of a finger and delivered to their doorstep. Accessibility, diversity, affordability and ease of use drive the entire shopping experience.
According to a report by market research firm, “The India omni-channel and warehouse management systems market size is expected to grow from USD 231 million in 2019 to USD 488 million by 2024, at a Compound Annual Growth Rate (CAGR) of 16.2% during the forecast period.”
This mindset shift has businesses forced to manage their supply chain more efficiently than earlier. The accelerated growth in online shopping will continue to strain the supply chain, if not transformed effectively. Omnichannel logistics ensure synchronised inventory flow across all channels, therefore need strategic and careful planning.
Things to consider for ‘Omnichannel Retail’
- Fulfillment strategy
This business model requires a fulfillment strategy that is able to treat customer demands on time and efficiently. In the traditional supply chain, items/products are stored in full pallets. Modern day retailing where these products are shipped directly from the warehouse to consumers, retailers need to implement new processes that are more agile and efficient.
- Diversity in portfolio
Many brands have introduced new products and diversified their portfolio in recent years, as today’s customer is more focussed on hygiene, safety and sustainability. Offering the right products and a diversified range of products has become a necessity. These things reflect brand loyalty, and in customer acquisition as well.
This also comes with increased complexity in supply chains, and requires more attention to the details. It is important to ensure that your supply chain management can keep up with your expanding product range.
- Delivery, offline and online
Omnichannel businesses should be able to deliver both from stores and distribution centers on time, and effectively. They should have an infrastructure or warehouse that enables shipping from multiple locations.
In order to meet customer needs, supply chain management has become critical. Many brands have started investing in SCMs and WMS platforms to take care of their inventories and warehouses more efficiently.
- IT resources and data analysis
Talking about warehouses, it may require additional investment in IT resources to create a seamless integration. An effective transition will need advanced planning and consultation in terms of hardwares and softwares, both. Warehouse must be prepped in advance for both store and web-based orders, to ensure there are no gaps in fulfillment and delivery.
- Stay updated with the innovation
As the industry grows, so do the trends and innovations and warehousing is no exception to this. In recent times, warehouse management systems have been the centre of attention for the omnichannel retailers.
Recently, micro-fulfilment centres have taken the limelight. We recently talked to Kunal Mehta, an industry veteran about MFCs and their impact. Retailers should stay updated with these innovations to maximise their revenue, and enhance customer experience.
Omnichannel strategy is an effective way for brands and retailers for a number of reasons- increasing visibility, boost sales, better customer insights, and more. But it also requires optimisation of the supply chain, as it is an integral component of a successful business model.