AML Blog - The Scan

Impact of Omnichanneling in the Warehouse

The warehouse has been an important part of a retail store’s supply chain for as long as retail stores have been around. However, the increasing popularity of technology has caused a shift in the way customers are shopping these days. Customers are using online shopping more than ever, and the prevalence of the smart phone means items can be bought at any time from anywhere. These changes are making omnichanneling the focus of almost every retail store.

The convenience of online shopping, combined with the speedy deliveries of some companies, has given customers high standards. Delivering the wrong product – or simply delivering the right product too late – is going to cause a business to lose customers very quickly. These changes in shopping patterns are going to influence warehouses in a few different ways.

Reorganizing the warehouse

Most warehouses are designed with traditional stores in mind; their primary focus is to meet the needs of the stores. The recent increase in orders that go directly to consumers is forcing businesses to rethink the traditional design. Most warehouses are not prepared for the number of orders going directly to consumers. Warehouses are also having trouble when it comes to shipping products to customers in a timely fashion.

Companies cannot afford to be unprepared at any level, especially when dealing with customers directly. Although retail stores should continue to be important parts of businesses, warehouses need to start focusing on individual customers, and consider developing an omnichannel strategy.

Can stores be warehouses?

Warehouses have always been separate from retail stores, but there are a few reasons to think that could change. Some businesses are starting to experiment with making deliveries from stores instead of warehouses. Making deliveries from stores can mean a few different things for customers. For one, stores tend to be located closer to customers. Delivering directly from stores is quick, easy, and can even allow for same-day deliveries. Stores that fulfill online orders could also give customers the option to pick up their orders at the store.

The biggest downside to this idea is that stores may run out of stock. Customers visiting the store would not be happy, and getting a delivery from a warehouse could take some time. Warehouses will need to be prepared to ship larger quantities at a faster pace in order to meet expectations.

Multiply or increase visibility

Omnichanneling might force businesses to increase the number of warehouses in their system. Speed has become the top priority of customers and, although spending money on more warehouses isn’t ideal, companies will have to keep up. Having more centers to distribute products will make it easier for stores to restock.

Visibility is also another option for businesses. The main problem with a supply chain is the lack of communication between the links of the chain. In order for a company to take advantage of online shoppers, it will have to have knowledge of every product in stock. Promising a customer a product that simply isn’t there is going to hurt a business’ reputation. If a company is able to see the state of affairs for every link in the chain, there will be no confusion and customers will get what they need.

Omnichanneling is impacting every aspect of the retail industry, but warehouses are quite possibly being influenced more than any other part. In the near future, warehouses are likely to be restructured to favor online shoppers. Stores and warehouses are likely to become more entwined than ever before, and visibility is going to be more important. Time has always been important in business, and omnichanneling is proving so once again.

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