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Kings of convenience: Retailers battle for shipping primacy
There's a quiet revolution underway in the fulfillment and distribution industry. Driven by competition, retailers are working to outdo one another by getting products from their shelves - both in stores and traditional warehouses - to consumers with greater speed. In the age of the consumer, expediency is fast becoming the key differentiator between merchants.
Brick-and-mortar stores as fulfillment centers
According to The Minneapolis Star Tribune, consumer electronics and appliance retailer Best Buy is putting a stake in the ground in terms of delivery capabilities, at least with the online component of its sales operations. The company announced that it would provide shoppers with a free two-day shipping option for all purchases above $35. Additionally, there are other items that are not included in the offer, including movies music and certain video games.
However, the proverbial gauntlet has been thrown down, especially during a time of the year when consumers are worried about their packages arriving on time for major holiday celebrations.
"Shipping is obviously important to our customers," explained Jeff Shelman, a Best Buy spokesman. "We wanted to make sure customers can shop now and be very confident the items will be delivered well before the holidays."
The Star Tribune indicated the move by Best Buy is likely part of a competitive strategy to undercut the convenience that Amazon Prime members enjoy - they also get free two-day shipping on a wide variety of items. Meanwhile, Target is yet another company that has thrown its hat in the ring, offering free standard shipping, largely without restrictions.
Battle for convenience
Best Buy's decision coincides with Amazon's plans to use bike messengers to deliver merchandise to consumers in New York City within an hour of purchase, Reuters wrote. While it's still in development and testing stages, the move is an attempt to provide consumers with an experience that more closely resembles the instant gratification they feel when shopping in stores.
Currently, Amazon uses one of its facilities in New York City as a base for bicycle messengers, who are paid roughly $15 per hour for their efforts. While there are obvious limitations relating to the size of items that can be ordered and delivered using a bike messenger, small items can likely be dropped off with relative ease.
How can retailers keep up their end of the bargain
With companies converting their stores into distribution centers, Best Buy included, there's going to be a high demand for order verification. Twice, an online news source for distribution, highlighted the fact that ship-from-store options will likely be a must to meet the expectations and standards they've set. While most warehouses have established processes that help to validate addresses in an effort to improve order accuracy, the systems in place in retail locations that aren't used to serving as distribution centers aren't likely as robust.
Address verification software will be an integral component of any investment to improve shipment efficiency. As demonstrated with Best Buy and Amazon, the race for convenience is far from over.
