The right combination of staging, equipment, and technology can help retailers drive efficiency and profitability for grocery operations.
As consumers grow their appetite for online grocery, retailers must adapt to the shifting landscape — starting with how they fulfill orders from the store floor.
Over the past year, the meteoric rise of grocery eCommerce has renewed discussions around retailers using micro-fulfillment to meet the increasing demand of click-and-collect and delivery orders. But even before the pandemic, brick-and-mortar stores were experimenting with various micro-fulfillment and in-store fulfillment methods.
While national retailers like Whole Foods and Walmart opened dark stores or partnered with distribution facilities to handle orders, independent and regional retailers were trying to figure out how to fulfill orders from crowded back rooms or designated spaces in store layouts.
For retailers just entering the eGrocery market, this reactionary strategy resulted in pickers “[competing] with customers, creating congestion and leaving items out-of-stock more frequently,” Reuben Scriven, a senior analyst at Interact Analysis.
The challenge of out-of-stocks threatened the viability of retailers’ new eCommerce businesses and the in-store customer experience. In fact, a report from IHL Group estimates that more than $505 billion sales were lost due to out-of-stocks during the pandemic.
Today, most grocery retailers that offer eCommerce have resolved their out-of-stock issues and continue to utilize their stores to fulfill orders. While using a micro-fulfillment partner or center can help ease issues such as congestion or out-of-stocks in-store, it’s not the only way to achieve profitability and meet consumer demand.
With minimal investment and floor space requirement, optimizing a store’s existing space for eCommerce orders is another path to successful order fulfilment. This can be done by making savvy equipment investments, store mapping and intelligent staging — requiring just 32 square feet of in-store space to start.
Getting the Most Out of Existing Store Space
To help reduce the amount of time personal shoppers are searching for items in-store and build order density, it’s important for retailers to have their stores well mapped.
At least 70 percent of eCommerce picking is spent traversing the store, so providing your personal shoppers with an optimal pick path can save you time and money — and increase customer satisfaction. Methods such as “batch picking” (e.g. assembling multiple orders during one pick session) or “zone picking” (breaking up the store into zones and having personal shoppers specialize in one area) makes pickers’ jobs easier and can contribute to building order density.
Having an efficient staging area is another way to grow a grocery eCommerce business. Many retailers make the mistake of purchasing expensive refrigerators and freezers to ensure picked products stay safe. This not only wastes money, but also takes up a lot of space and often doesn’t scale well.
By leveraging smaller, more manageable solutions — such as the use of temperature-controlled totes instead of another $10,000 refrigerator, for example — retailers can keep products fresh for up to 16 hours at just a fraction of the cost. It also promotes food safety best practices, ensuring that product never breaks temperature from the time it’s picked until it arrives at a customer’s door.
Since most starter staging areas can usually accommodate 50+ orders a day, using insulated totes is a much more cost-effective solution for scaling eCommerce operations. Other ways to improve efficiency and customer satisfaction include:
- Providing real-time customer and store alerts to notify customers and store staff when an order is ready for pickup or on their way out for delivery;
- Offering order pickup parking stalls in the parking lot to help customers easily identify where to pick up an order; and
- Placing the order pickup parking stalls near the store’s staging area to ensure minimal wait times for customers.
Retailers should also consider technologies to help facilitate a frictionless personal shopping experience for the pickers. For example, tools that can provide pickers with an easy way to verify correct items, replace any out-of-stock items with relevant substitutions, and automate payments without running through a physical check-out lane will allow them to pick up the pace.
Get Your eGrocery Business Up and Running in 30 Days or Less
You don’t have to figure out in-store fulfillment on your own. Our expert team is here to optimize your existing space and help you make the right investments to support a profitable eCommerce business. Our GK Light Operating Model requires just 32 square feet of in-store space, and starts at just $2,000 a store.
Our starter staging model has the potential to help each store earn an additional seven figures in eCommerce revenue. With our suite of fulfillment technology and tools, we provide everything you need to to successfully pick, pack, and deliver eCommerce orders at scale.
If you’re ready to optimize your existing eCommerce business or start a new one, contact our team or book a demo today.