Fulfillment Centers

Fulfillment Centers

April 13, 2020
Ross L. Fink, Ph.D.

As online orders are becoming a more important part of many retailers’ business, how those online orders are fulfilled is increasing in importance.

Many organizations take an omni-channel approach.  In this approach, regardless of the purchase method used (online from desktop or mobile device, social media selling, or brick and mortar), the experience is seamless.  The various methods are combined together to work with each other so that the customer experience is similar.

Another approach is multi-channel.  In this case, the retailer is selling through a variety of approaches, with each operating separately.

One approach for online orders is to use fulfillment centers.  Fulfillment centers have changed from the traditional warehouse primarily dealing with pallets shipments to and from the warehouse. Today’s fulfillment center ships out individual orders to customers.

Because of all these differences, a variety of approaches are being used.  For example, Home Depot has decided that a fulfillment center should be used for professional customers and large consumer orders of lumber.  Its Dallas fulfillment center will serve a 75-mile radius with flat-bed delivery.  It also has the ability to receive rail cars.

Hy-Vee is using a different approach.  The Continue reading →

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Amazon Is Banking on Brick-and-Mortar Stores

Amazon Is Banking on Brick-and-Mortar Stores

March 10, 2020
Corinne M. Karuppan, Ph.D.

Amazon is expanding its physical retail footprint.

After putting other retailers out of business, it is pursuing a brick-and-mortar strategy in the grocery business, a sector known for razor-thin profit margins. It has also opened several physical bookstores at a time when Barnes & Noble, unable to compete with the digital retail giant, has been closing its own. The common element to an increasingly diversified portfolio of businesses is the Prime membership. In making its products and services ubiquitous, Amazon is becoming more of a lifestyle than just a retailer.

Video Spotlight: Amazon’s New, Full-Size Grocery Store

This post is based on the CNBC article, Amazon Just Opened a Cashierless Supermarket – Here Are All the Ways It’s Trying to Upend the Grocery Industry, by A. Palmer, February 25, 2020, and the YouTube video, Here’s A Look Inside Amazon’s First Full-Size Grocery Store, by CNBC Television, February 25, 2020. Image source: SEASTOCK/Shutterstock.

Discussion Questions:

1. Why is Amazon increasing the number of its physical stores in areas where others have failed?

Guidance: Amazon has put a large number of retailers out of business. With enormous financial resources and weak competition, it can try different growth Continue reading →

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No-Inventory Stores

No-Inventory Stores

February 29, 2020
Ross L. Fink, Ph.D.

Showrooms have existed for many years.  Now, however, more stores are turning to the concept of a showroom that has very little inventory—especially clothing stores.

The lack of inventory generates several advantages associated with less inventory.  In many cases, the stores are not reducing the size of the store, they are replacing the inventory with experiences.  The inventory can be replaced by personal stylists, cafes, a streamlined return desk, or office space.

The Canada Goose store in Toronto has taken the experience approach to new levels with a daily snowstorm.  Customers begin “The Journey” by walking through “The Crevasse” that simulates walking on cracking ice.  Another stop on “The Journey” is the “Gear Room.”  This room resembles a Norway seed vault.  It is where the customers select Canada Goose coats and accessories to try out in “The Cold” room.  In this room, arctic conditions are simulated, with the temperature set at 10 degrees Fahrenheit.

If “The Journey” has gone according to plan, customers will leave the store empty-handed.  But, they will be anticipating the delivery of their new Canada Goose gear.

Video Spotlight:

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