Omnichannel Fulfillment Guide
One of the most predominant shifts in the last decade has been the need to realign retail fulfillment to the changing needs and demands of the consumer.
Omnichannel retail has become the next big leap for brands of all sizes and has led to a broad rethink of how to ensure customer satisfaction and ongoing brand loyalty.
Consumers in the digital age expect their experience with businesses to be seamless from an initial product search right through to after-care.
The rise of ecommerce has only served to make that goal more challenging to meet. When efficiency and profitability are vital, omnichannel fulfillment is no longer an option but a necessity for brands that want to grow.
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What is omnichannel fulfillment?
Omnichannel fulfillment is the process of picking, packing, and shipping orders that are sold across multiple stores, sales channels, and online marketplaces.
This method requires data to sync from a variety of sources and technology that enables a single source of truth for inventory and orders. Unlike fulfilling orders from a single store, an omnichannel fulfillment strategy must allocate inventory for different stores and ensure products aren’t over or under accounted for to prevent overselling and overstocking.
Omnichannel fulfillment can take place in warehouses or fulfillment centers, in-store (to ship out orders or for curbside pick-up), and other locations to help get products into the hands of consumers.
Omnichannel fulfillment boasts big benefits
When consumers have options in how they buy, businesses are more likely to increase their customer base through new channels and platforms. Omnichannel fulfillment is a no-brainer for brands that don’t want to rely on a single channel or remain complacent in a competitive market.
1. Higher order efficiency/accuracy
Fulfillment becomes much easier to ensure as it streamlines multiple channels into a single process. This leads to improved efficiency, more accuracy in the delivery processes, and a seamless shipping system.
2. Happier customers
Modern customers expect immediacy. Omnichannel fulfillment means that they can receive their home-delivered goods faster, or opt for in-store pickup if they prefer. When consumers expect the best service at the best price, omnichannel fulfillment keeps them coming back and more willing to return to your digital and real-world outlets.
3. More accurate reporting
When you use a 3PL, you have a provider that will oversee all of your channels. It means you get access to instant reporting that can highlight your most important channels and identify the ones that will require improvements.
4. Stronger brand image
Customers want to know that no matter where they are, they will have access to your product. They want to have the option of in-store pickups, home delivery, or real-world store browsing. Those channels all need to be consistent if you wish to maintain your established brand image, such as Target. As in-store pickup, delivery, and regular shopping is consistent; this builds Target’s reliable brand image.
Challenges of fulfillment with omnichannel retail
An omnichannel business does not come without its risks. Identifying and avoiding common mistakes is possible with the right approach and an awareness of where things can go wrong. Learn the top multichannel retailing pain points below and how to prevent them.
Difficult to manage inventory across channels
Multichannel inventory management brings new challenges to the already difficult world of inventory management. When you sell the same products on multiple channels, it’s easy to double (or triple) count SKUs and units when they’re actually the same physical product(s) under different stores and listings.
To maintain stock levels, reorders, and inventory forecasting across sales channels, you must factor in various buying behaviors, turnover rates, return frequencies, shipping speeds, and overall demand.
This means what’s listed on multiple channels must match what you actually have for available inventory in your warehouse. If you have 300 units left and sell on 3 stores, should you allocate 100 units to each channel? There’s probably more data needed to forecast demand, but one thing’s for certain — you don’t want to have 300 units available on all 3 stores, as you may oversell 600 units that you don’t have.
The ability to easily merge the same SKUs from different stores in a centralized fulfillment platform is key to ensuring you don’t overcount and overcomplicate managing your inventory levels.
To manage this properly, you need access to real-time inventory data so you can keep a close eye on available stock and update inventory counts on stores accordingly.
You also should closely monitor when you need to replenish inventory and set reorder point notifications to automatically alert your team when it’s time to order more inventory from your manufacturer.
Hard to develop and maintain a fulfillment infrastructure and strategy yourself
It can be a challenge to implement and launch an omnichannel strategy if you lack the necessary infrastructure.
You can always invest in a fulfillment warehouse, equipment, technology, and an omnichannel fulfillment team, but that’s expensive and time-consuming. Many brands look to partner with an order fulfillment company that can manage the process for them.
Synchronization is the key to an effective omnichannel strategy, and without access to the available resources (like what a fulfillment company has), it can be hard to keep up with the expectations of each channel on top of day-to-day fulfillment issues like staffing labor, ordering supplies, and maintaining order accuracy.
Strategies for omnichannel fulfillment
There is no one-size-fits-all solution for omnichannel fulfillment since the needs of each brand and channel can vary greatly. Below are a few considerations and methods that may work for you.
Outsource omnichannel fulfillment to a single 3PL
Third-party logistics (3PL) providers are an excellent option that can cover every aspect of omnichannel fulfillment. 3PLs like ShipBob provide multichannel logistics, with direct integrations to all leading ecommerce platforms and marketplaces like Amazon and Walmart, and lets you offer fast and free shipping for other search engines and channels like Google Shopping. You can expand into new sales channels with ease and still manage inventory and orders from one fulfillment dashboard.
Keep fulfillment in house
In-house fulfillment involves either keeping products at your home and running to the post office daily, or leasing a warehouse and building out a team of fulfillment associates. Inventory storage can be challenging in this model, as you may outgrow or never fully grow into your space, and be locked into a long-term lease.
Use different strategies & services for different channels
Multichannel distribution may call for different fulfillment methods. Some brands take a hybrid approach to fulfillment, fulfilling some orders themselves and partnering with companies for specific channels. The most common example of this is using FBA for Amazon fulfillment since they have the strictest requirements for Prime badge shipping, and working with a 3PL or fulfilling other (non-Amazon) orders themselves.
Some businesses may have a physical store they sell out of, allowing for in-store or curbside pickups, and even the ability to fulfill orders from their store, acting as a hub for distribution (though space is often smaller).
Get the right technology that works with different channels
Both an order management system and ERP system allow a business to set rules and consolidate channels for a more cohesive fulfillment strategy.
If you work with a retail fulfillment provider, review the technology they offer. Those that offer omnichannel fulfillment have B2B shipping, integrations with not only ecommerce platforms and marketplaces but other tools, from order and inventory management systems, to returns management software (and even Developer APIs to allow for custom builds).
How ShipBob turns your omnichannel fulfillment into a revenue driver
ShipBob is a tech-driven fulfillment company that helps brands of all sizes deliver a best-in-class customer experience across channels. ShipBob centralizes logistics operations with built-in order and inventory management tools and fast shipping to deliver on customer expectations.
ShipBob helps manage omnichannel fulfillment with a robust fulfillment network and technology solution that includes dozens of integrations with leading ecommerce platforms, marketplaces, sales and social media channels, and even B2B fulfillment capabilities.
It’s easy to manage products, orders, customers, and shipments across all sales channels. ShipBob even offers 2-Day Express shipping, which helps reduce cart abandonment and increase sales for direct-to-consumer orders.
ShipBob can help you build your omnichannel strategy
ShipBob makes it a seamless process for you to sell your products across a multitude of platforms and channels. They combine inventory management software with nationwide fulfillment to help get your products where they need to be. Best of all, it integrates seamlessly with Skubana, a leading multichannel inventory software.
Omnichannel fulfillment FAQs
What is omnichannel fulfillment retail?
Omnichannel fulfillment retail is the process of picking, packing, and shipping orders as customers place them across a variety of sales channels. These can range from brick-and-mortar retailers, to ecommerce stores and online marketplaces.
Can you outsource omnichannel fulfillment?
Yes, many 3PLs or professional fulfillment companies allow you to outsource fulfillment of orders via all the places you sell products. Using their technology, you can integrate your stores and manage orders and inventory through a central dashboard.
How can you transition to omnichannel fulfillment?
Going from selling on a single store to multiple channels requires setting up a presence (e.g., getting approved to sell on a new marketplace, opening a physical store, creating your own website, etc.) and getting fulfillment infrastructure and technology in place to manage inventory, orders, and customers across sales channels.
This might involve working with new partners like a 3PL that specializes in omnichannel fulfillment to help pick and pack orders and centralize your fulfillment operations.
Can you increase sales with omnichannel fulfillment?
Yes, omnichannel retail in general is a great way to increase sales by meeting customers where they are and giving them choices in how they buy and receive your products. A good omnichannel fulfillment experience can lead to a speedy delivery (even a great unboxing experience) and, thus, a positive customer interaction, increasing the chance of them purchasing from you again.
