Welcome to Parcelconsulting
Welcome to Parcelconsulting
Customers have never asked for more flexible fulfillment and delivery options than they are right now. The coronavirus global pandemic has left many people with concerns about shopping in brick-and-mortar stores, which has shifted the fulfillment landscape drastically. Consumers around the country are ordering products for their home and business online at record levels, and more people than ever are looking for options like local delivery, ship-from-store, buy-online-pickup-in-store (BOPUS) and expedited services.
This should be clear when looking at the companies that are growing aggressively even during uncertain economic times, like Amazon, Target, Walmart, Best Buy and more. Smaller, more locally focused retailers are also on the rise now that supply chain disruptions have leveled the playing field.
Demand for goods continues to push businesses to develop flexible order fulfillment strategies. This is what you need to know about the future of fulfillment.
Flexible fulfillment methods have helped retailers across the board get ahead during the stay-at-home orders, and even major retailers saw huge growth. Consumers who typically shop with Amazon for everyday necessities and frivolous items alike had to turn to alternative retailers when ecommerce demand spiked.
As a result, Best Buy’s domestic sales grew 250%, Target’s digital sales were up 275% month to date and Walmart grew its revenue by $10.7 billion. Walmart reported increased demand in grocery pickup and item delivery, which contributed to its 9% revenue growth. Even ecommerce furniture brands Wayfair and Overstock saw a surge in shopping. Wayfair’s revenue was trending toward a 90% year over year increase and a 20% rise in net revenue. Not one to be left behind, Overstock posted a 120% year over year increase in April and a 100% increase in its office furniture category.
Still, Amazon had big wins, growing net sales by 26% year over year in Q1 and being poised to hit $260 billion in domestic retail sales (38.7% of the market). This was regardless of a temporary pause on stocking non-essential items and products outside of the home and cleaning categories and a major delay in shipping.
On the physical retail front, Walmart and Nordstrom are just two of the major retailers that transitioned to offering a creative take on BOPUS (buy online, pick up in store) by opening micro-fulfillment centers. BOPUS has been popular for a long time—40% of shoppers consider it a necessity—and it grew 208% year over year in April. That’s why some retailers began testing micro-fulfillment centers where shoppers could pick up their orders without venturing into crowded big box stores and putting themselves at risk for infection. These smaller format brick-and-mortar locations give consumers a physical place to pick up the goods they purchased online, so they can skip the waiting that home delivery requires.
The coronavirus pandemic sped up the integration of online and offline shopping, and the numbers show the retailers that adapted and remained flexible were the biggest winners.
While major retailers that have invested heavily in expanding and improving their delivery options over the past decade have led the way, consumers are also showing a growing demand for local goods and products. This is a perfect opportunity for local businesses to utilize shopping cart and shipping software options that can enable local delivery services immediately. Whether your business needs to tap into the gig-economy drivers or if you’re looking for professional courier services or white-gloved delivery, there are flexible options for nearly every major and mid-market city in the US.
As one example, the grocery category saw a huge bump earlier this year. Grocery stores experienced food shortages due to supply chain disruptions and consumer bulk buying, so consumers expressed increased interest in fresh, local produce. This was a way to not only avoid being around other people in grocery stores but also to have control over the food they were eating. Not to mention, gardening and getting involved in local agriculture were productive activities during shelter-in-place. Businesses that sold seeds and vegetable growing kits doubled and tripled their revenue, driving a need for 3PL solutions offering local delivery.
As Amazon rose to power, the modern consumer became used to one-click ordering and then receiving items within two days. Automation and robotics closed distances that once seemed vast, allowing for supply chain globalization and a faster fulfillment timeline than consumers had ever seen before. Ironically, the “final frontier” was fast local delivery—even though anyone can order a meal online and have it in hand in an hour or less. This was the basis of companies’ creativity in their same-day and next-day delivery options.
Some retailers are transforming their brick-and-mortar stores into micro-fulfillment centers (or flexible fulfillment warehouses) where customers can pick up their orders, or deliveries can be made across shorter distances. This saves time on both the seller’s and shopper’s side, and it reduces transportation costs for the business.
Other companies are utilizing strategic partnerships to get products in customers’ hands faster. Direct-to-consumer brands Casper, Harry’s and Quip have all partnered with Target for brick-and-mortar sales. They get to bypass the logistics of operating fulfillment centers across the country and instead use an existing network to reach customers wherever they’re located.
Most ecommerce businesses start out with one fulfillment center that serves as an inventory hub and is the origin point for customers’ orders. Then, as the business scales, there’s demand for faster shipping options and a need for another fulfillment center that can serve the customers who are farther from where your original center is located. Many retailers solve this by implementing a bi-coastal fulfillment strategy.
If your business has a single fulfillment location on either coast, there are many options for your company to move some products to a fulfillment warehouse on the other side of the country and improve your fulfillment significantly. This simple strategy can improve delivery times significantly and lower your shipping costs by making all shipments low zone. Having multiple fulfillment centers increases your capacity for same-day and next-day delivery to more areas.
Many different shipping software systems will allow you to fulfill orders in a certain portion of the country and send those orders outside that region to a fulfillment house. This process is so much easier than it was 10 years ago and there have never been more competitive and flexible fulfillment warehouse options.
Parcel Consulting was started with a simple mission in mind: Connect end shippers with the best carrier and rate strategy for their needs and the best software options to streamline, automate and improve the accuracy and efficiency of the daily pick, pack, and label-printing process for their business.
We work with many different carriers and software partners, so that we can recommend the best solution based on more than a decade of actual experience with all these providers.
Most people, even those experienced in shipping and logistics, are surprised to find out how many new and innovative carriers and software options exist now.
We have been tracking, comparing and evaluating them objectively for more than 10 years and we freely share our personal review of your shipping needs by simply scheduling a phone call or video conference with one of our experienced shipping consultants.
We’ve been preparing for this for more than a decade and we’re here to help! Give us a ring to discuss your options at: 833-PARCEL-1 (833-727-2351).
