What is Ship-from-store?
Ship-from-store is a technique which consists in using the stocks of physical points of sale to ensure deliveries made over the internet. This delivery strategy will make it possible to optimise inventory management.
What are the advantages of ship-from-store?
This method enables:
- Reduce delivery times because products are sent directly from the buyer’s nearest point of sale. This makes it possible to reduce the distance and therefore reduce pollution linked to delivery.
- Reduce logistics costs due to warehouse storage and long distance delivery.
- Increase sales by limiting stock shortages. When a product in the central warehouse is out of stock, customers can still place their orders using the stocks of the different stores. Thus the company benefits from better reactivity in the face of a sudden increase in demand.
- Sell end-of-series items from points of sale without having to resort to product returns. Indeed, even a product not available in the warehouse can be sold if it is available in one of the stores. Stock funds can thus be sold off progressively, rather than being sold off during sales.
- Improve customer satisfaction. Customers will have a broader product catalog, thus diverting them from the competition. They will also receive their items in a much shorter time, a fundamental point for the customer who buys online, accustomed to immediacy.
Despite its many advantages, the implementation of ship-from-store requires extremely precise inventory management at the participating points of sale.
Set up “ship-from-store”
The implementation of ship-from-store requires good inventory synchronization and the involvement of in-store sales teams. This implementation is generally part of a global omnichannel strategy allowing sharing of customer/product/stock information between stores, headquarters and warehouses.
The points of attention are therefore:
- Optimisation of space. A business generally has limited space. It is therefore necessary to optimise the small storage space available to the store in order to manage more products.
- Prioritisation of orders. In the event that the products in store also appear in stock on the website, it is possible that 2 customers purchase the same product at the same time: One in store, the other via the website. Rules must therefore be established to avoid such overlaps.
- Packaging management. Packaging operations are more complex than they appear. The business must therefore organise a space to store the boxes and equipment necessary for packaging and shipping orders as quickly as possible. In addition, for small and/or fragile products, the store must be able to add filling and protection systems to the box.
- Staff training. Preparing orders requires different skills than an in-store salesperson. Staff must therefore exchange their support and advice skills… for organisational and logistical skills. It is therefore necessary to train employees for these new functions and possibly include specialised personnel. Furthermore, to motivate sales forces to invest in these new functions, it may be necessary to objectively assess them based on specific KPIs (order management times, customer complaint rate, etc.).
- Inventory synchronisation. The different stocks (warehouses and stores) must be synchronised via an ERP such as LM Business. Thus e-commerce sites will be able to know for each item where it is available and in what quantity.
- Logistics service. A store is generally equipped to receive logistics providers and the merchandise they sell. With ship from store, the logistics service must be efficient, capable of collecting in store all orders sold online and to be distributed to customers.