The Omnichannel Retail Supply Chain

At the recent National Retail Federation (NRF) conference in New York, there was a distinct theme echoed by attendees: The need to evolve the current multichannel approach into one seamless presentation of merchandise in-store, online, and via mobile device.

At the recent National Retail Federation (NRF) conference in New York, there was a distinct theme echoed by attendees: The need to evolve the current multichannel approach into one seamless presentation of merchandise in-store, online, and via mobile device.

The term being used within the industry to describe this multi-faceted interaction is omnichannel.

But optimizing the consumer experience for maximum profitability and customer loyalty requires more than an integrated presentation of merchandise. It requires supply chain strategy and infrastructure specifically designed to anticipate the needs of the clientele in general and to react quickly and efficiently to the ultimate purchasing decisions of each individual customer.

The omnichannel supply chain will mean increased complexity in shipping: fewer cases and more eaches; fewer truckload shipments to individual locations in favor of multi-stop routes or cross-docked loads; the ability to move inventory from store-bound for point-of-sale availability, to being delivered to a consumer’s home via parcel carrier for a reasonable shipping and handling fee, or to being shipped to the store of a customer’s choosing so it can be picked up “for free” the next day.

But the omnichannel supply chain can also mean an infrastructure that enables retailers to monetize the latest trends more quickly and with lower risk — dramatically decreasing inventory carry costs and the being able to move merchandise out without having to resort to deep-discounting.

As retailers look to re-imagine their customer experience to better reflect how consumers shop, the successful companies will be those who ensure that their supply chains are prepared to support this evolution.

Organizations that do not do combine channels and infrastructure actually risk alienating customers by failing to deliver on the heightened expectations created from an enhanced shopping experience. However, the most successful retailers will be those that recognize supply chain as a key enabler of the transformational customer experience and use it to further distinguish themselves from the competition.

Exceeding customer expectations as a means of maximizing profitability depends upon an organization’s ability to anticipate preferences when possible while simultaneously reacting to each individual’s final preferences at the time of purchase.