The Future of Fulfillment for Your Business
The retail world has been through a rough couple of years. As the pandemic brought much of in-store retail to a halt, e-commerce boomed, and retailers had to redefine their business models and logistics to adapt to the changing market. Order fulfillment soon became a make-it-or-break-it aspect of business; new trends have changed how products end up in customers’ hands, and how businesses facilitate fulfilling orders – and will continue to make those changes.
Here are 5 fulfillment trends that your business should utilize in order to keep up with the ever-evolving market:
5 Future-Facing Fulfillment Trends
1. Flexible Fulfillment Options
Over the years,fulfillment options have become increasingly more flexible as customers’ needs and preferences have changed. Different methods allow customers to choose between cost and convenience in terms of delivery methods, letting them receive their orders on their terms.
- Direct-to-Consumer has seen a major up-tick in recent years, in no small part due to COVID. Shipping directly to the customer reduces the amount of steps where things can go wrong, and gives companies more control over the fulfillment experience (packaging, delivery carriers/methods, etc.)
- BOPIS (Buy Online, Pick-Up In Store) has also seen a major spike in popularity, driven by the need to purchase and receive goods from traditional brick-and-mortar stores with minimal person-to-person contact.
- Curbside Pickup also became incredibly popular due to the pandemic and allows customers to quickly receive their goods without the need to even get out of their cars.
- ROPIS (Reserve Online, Pick-Up In Store) is a popular choice for larger/more expensive purchases, like furniture or luxury goods, ensuring that the items are in stock and available for the customer to see before purchasing.
Time is also an extremely important factor in order fulfillment. It’s estimated that over 80% of customers are willing to pay $5 or more for same-day delivery; 27% of customers have also stated that they have abandoned or canceled an order because same-day shipping wasn’t available. Logistics companies have taken notice of this, and are adjusting their operations to accommodate this increased emphasis on faster delivery. More than 75% of all logistics companies expect to provide same-day delivery within the next few years, and about 33% anticipate same-day delivery within a two-hour window by 2032.
2. Real-Time Inventory and Shipment Visibility
Mistakes, supply chain disruptions, and even full breakdowns in the fulfillment process can be extremely costly for a business in both a financial sense and a brand reputation standpoint. Being able to see the entire fulfillment network in real time is invaluable for businesses; proper visibility ensures that orders get delivered to the right customer, at the right time, at the right cost.
Being able to track inventory and keep it updated in real time is vital to keeping your products available for purchase, whether you’re an online business or a brick-and-mortar store. 51% of retailers report that “out of stock” issues are their biggest fulfillment challenge. If customers aren’t able to buy what they want from your business, they will most likely look for that same (or similar) product elsewhere.
Order tracking is another vital part of the fulfillment process, for both businesses and customers. It’s estimated that 90% of customers track the status of their online orders. Being able to see their package’s journey from start to finish helps put their mind at ease, and making it easy for them to do so also helps build trust.
3. Data, Virtual Intelligence, and Automation
Data is perhaps the most valuable asset of the entire fulfillment process. As companies shift towards more customer-centric fulfillment, data sciences and analytics are transforming how they do business. Virtual intelligence and machine learning is already being used to process data and automate large chunks of the fulfillment process, and logistics as a whole. This, in turn, is projected to shift the human workforce towards tweaking algorithms, creating response scenarios to likely events/mishaps and coding them, and other tasks meant more to support these automated processes than handling them directly.
4. Omnichannel Logistics
As online retail has evolved, logistics networks have needed to adapt how they work. Speed, transparency, and flexibility are perhaps the three biggest factors in customers’ expectations nowadays; one of the best ways to seamlessly target all customer channels – online and offline – is applying an omnichannel approach to your logistics needs.
Omnichannel logistics integrates all existing channels of your business – online stores, brick-and-mortar stores, social media accounts, etc. – to create a seamless shopping experience for customers. This approach is driven by centralized data and inventory management, allowing customers to start their search on one channel and finish their purchase on another.
Some key benefits of omnichannel systems include:
- Easier for customers to choose the fulfillment option that works best for them (direct-to-consumer, buy online pick-up in store, etc.)
- Faster and more accurate deliveries
- Increased profits due to higher revenue and lower costs
While omnichannel logistics has huge upsides, there are also several big challenges that must be addressed for them to work seamlessly:
- Inventory visibility
- Delivery tracking/visibility
- Delivery speed and accuracy
- Segmented supply chains
- Reverse logistics
5. Green Logistics
While the pandemic negatively affected businesses in many ways, it had an unexpected impact on order fulfillment. As e-commerce sales skyrocketed, last-mile delivery – the final phase of order fulfillment where the product arrives at the customer’s door – got greener. As online purchases boomed, brick-and-mortar stores became fulfillment centers. Ship from store, BOPIS, and curbside pickup all emerged and thrived. Because of this, shipment drop density rose, which means that there’s less time delivery drivers are on the road, as well as less time spent waiting, unloading, and everything in between that kills time (and uses fuel).
Last-mile delivery currently accounts for about 53% of total shipping costs – and roughly 40% of total supply chain costs. Because consumer behaviors changed, last-mile delivery’s carbon footprint changed – thankfully for the better. This shows that with the right planning, last-mile delivery can become more efficient, less expensive, and more sustainable. Three keys to this are incentivizing greener fulfillment choices, adopting an “asset-light” philosophy, and utilizing real-time data and analytics. This will allow retailers, delivery companies, and customers to make more sustainable fulfillment decisions and further lessen their environmental impact.
Looking for the Right Packaging Solutions for Your Fulfillment Needs?
Preferred Packaging Is Here for You
Whether you are a small business that needs more packaging materials to keep up with demand, or a well-established company looking to better manage your inventory, Preferred Packaging Products can provide the materials, services, and expertise that can help your business thrive.
Since our founding in 1985, we have been the preferred packaging solution for hundreds of businesses along the Front Range. We specialize in developing custom packaging that will both ensure that your products are protected during shipping and help your brand stand out. We also offer a wide selection of generic packaging products and materials to suit all your packaging and shipping needs.
Our warehouse, distribution, and logistics services can help you to streamline your packaging process and better utilize your warehouse space and better support your order fulfillment process. Our kitting and assembly services can take a load off your employees and help your business focus on other tasks, while our packaging equipment automation and installation services can further increase your packaging efficiency and aid in the transition to a more hands-off packaging process.
To see what Preferred Packaging Products can do for your business, give us a call at (303) 444-4774 or get in touch with us online to get started.