In the world of retail logistics and order fulfillment, we have watched the “ship from store” trend go from a rarity to common practice in a relatively short period of time, leaving many retailers a bit puzzled about the new phenomenon. Others are left wondering what “ship from store” means, and how it is impacting the retail industry as a whole. The answer, it turns out, has a lot to do with the changes the internet has brought to the worlds of shipping and fulfillment, and the overall pressure within the industry to get products to customers faster.
What exactly does “Ship from Store” mean?
The “ship from store” system is essentially a response to the overwhelming demand for online orders that has taken over the retail industry. With more and more consumers choosing to stay home and let products come to them, both carriers and retailers are having to work extra hard to keep up with increasing volumes of products going out for delivery.
Here, legacy retailers have finally found their advantage over online stores. Utilizing their access to ample storage space inside their physical stores, brick-and-mortar retailers have been beginning to use stock from store locations to fulfill orders in local areas, thus granting them a leg up against eCommerce giants such as Amazon.
This practice essentially transforms the physical store into a virtual distribution hub, allowing the brick-and-mortar retailers to get products to local consumers faster. Given its initial success, it’s not surprising that the trend is catching on. According to Forrester Research, one out of every three omnichannel retailers has embraced a “ship from store,” or SFS, program to fulfill product deliveries.
The Death of Brick-And-Mortar Retail
The truth is that “ship from store” practices may prove to be a key tactic to stop and maybe even reverse the decline many physical retail stores have experienced over the last few decades, ever since eCommerce began to have a major influence on the market.
As more consumers have chosen to order from online retail sites rather than make the trip to department stores like Macy’s and JCPenney, these legacy retailers have slowly lost market share to newcomers such as Amazon and eBay. Already, we’ve seen once-dominant retail giants like Sears begin to fail, closing stores across the country as they struggle to adjust to industry changes.
With the loss of market share, many of these large brick-and-mortar retailers have been left with expensive real estate in the form of cavernous physical retail stores in shopping malls and downtown areas around the country. With dwindling visits from consumers recorded over the years, many of these retailers have been scrambling to figure out what to do in their current situation.
The solution for many is the “ship from store” system. One of the chief challenges in retail is quick fulfillment of products, and SFS solves a lot of these problems. Traditionally, these products would come from regional distribution centers around the country or the globe. With SFS, though, a retailer can cut out the high cost of shipping products thousands of miles and get an upper hand on eCommerce businesses in the process.
The question remains, though. Will “ship from store” be enough to save legacy retailers and other brick-and-mortar sellers?
SFS and Other Changes Coming to Retail
We’ve already seen a lot of talk around the industry about the future of retail, and many think that combining the best aspects of online and traditional retail will be the key going into the future. We’ve heard buzz about online retailers trying out storefronts that will act as the face of the company and allow consumers to interact with featured products, try on clothes and accessories.
Shipping and fulfillment will continue to be an area where the retail arms race is heating up. We expect SFS to be embraced by more traditional retailers over the next few years. It means they can give consumers what they want: free, quick shipping to their homes and businesses. This will possibly put some pressure on online giants like Amazon to change their distribution strategy, but only time will tell.
At the current moment, it’s hard to imagine Amazon falling from its dominance in a retail market where the race for customer’s loyalty has never been more contested. Plus, the profit possibilities are now rising into astronomical levels as we move toward a fully-interconnected world. Here every single person will have access to the internet in nearly every corner of the globe.
Moving Into the Future of Logistics
The best way to prepare for changes in the logistics industry is to make sure you have a logistics partner you can trust. The “ship from store” phenomenon is only the beginning of many big shifts in the industry. By investing in a logistics partner with both experience and adaptability, you’ll be in a strong position to adjust to those changes.
One great way is to do your research on emerging trends. With good data behind you, you’ll be able to anticipate industry changes before they have a major impact and disrupt your supply chain. If you have a great logistics provider you can depend on, you’ll be able to lean on their extensive knowledge and dig deeper into logistics predictions for the future with their help.
If you have any questions about Expak’s range of services, please call our customer service team at 424-320-5300.