The world of multichannel: how good logistics is getting retailers ahead

The last decade has seen the fastest development in consumer technology in history. Smartphones, tablets, superfast broadband and 4G mobile internet have revolutionized the way consumers are buying products. The days of catalogue-flicking and telephone-dialing have been replaced with sleek, efficient apps and easy to navigate websites, and retailers are having to adapt to remain competitive.

At the core of this changing retail landscape, though, is a changing logistics landscape: to match new demands in how customers order and receive their goods, retailers are developing new ways to maintain successful operations in their stores whilst meeting growing internet demand through their core logistics operations.

Multi-channel and Omni-channel – An entire shop in the palm of your hand

The terms ‘multichannel’ and ‘omnichannel’ retail were coined around the start of this decade to signal the shift in the ways customers purchase items from retailers. The Apple iPhone launched in late 2007 and in 2010 the iPad hit shelves; in the years since, both the smartphone and tablet markets have dominated the mobile and home computing spaces, offering simple, quick and compact access to the internet. Moreover, to match the growth in use of these devices, superfast fibreoptic broadband has become affordable, 4G mobile internet has been introduced and public WiFi hotspots are now commonplace.

For retailers, this growth has meant opportunity to reach customers in new ways. In the UK, the high street’s biggest names, such as Next, John Lewis and Topshop, each have dedicated mobile and tablet apps and cutting edge websites as well as maintaining highly successful operations in their shops.

Retailers now also offer a range of convenient customer delivery and collection options. A variety of delivery speeds (with varying prices to match) as well as in-store ‘click and collect’ services and more recently introduced options to collect goods at satellite locations (such as Collect+ and Waitrose’s railway station lockers) are allowing customers greater flexibility than ever before.

Logistically tying it all together

But offering such a broad service has meant that, logistically, retailers have had to up their game. Whereas in previous decades, stock was primarily based in-store and shipped to customers from there, the rise of multichannel has meant that large fulfilment centres have been built to deal with the growing demand of online retailing, creating two channels of distribution: one direct to the customer, and a second, two-step process where stock is delivered to store and then onto the shop floor.

This means that retailers are faced with a difficulty customers dread: the website shows stock available to order, but when visiting, the customer finds that they are sold out at the store.

The solution? Creating one logistics ecosystem. A prime example of this system is at Currys PC World: customers can see if a product is available in-store via the website, reserve the item online and pick it up within the hour, all because the logistics ecosystem is one clean process with both online and in-store operations feeding into a central distribution channel instead of a clunky, outdated dual system. Proof that, no matter how technology and consumer spending habits change, forward-thinking logistics is at the centre of retail success.