Consolidating enterprise technology was earmarked as one of the business trends to watch in 2018 as more and more companies begin to allocate (or remove) resources that have the most impact on the customer journey.
It sounds strange, doesn’t it? The idea that as an organisation grows, and increases its pace of business, it’s actually more effective to consolidate disconnected applications into fewer processes.
But what if there really was a way to expand to new markets without adding new infrastructure or costs into the business?
Shippit HQ has worked with retailers of all shapes and sizes, and we’ve seen businesses at all different life-stages grapple with lean approaches to growth.
Many business leaders believe that in order to grow, you need to invest heavily into new resources as the seeds that will hopefully blossom into a flood of new revenue.
With such an uplift in the growth in technology, it’s now not really necessary for businesses to invest in new infrastructure and sink costs when expanding into new markets.
In this post, we cover why ship from store is a lean approach to driving growth and revenue.
The Lean Business Framework
“Lean manufacturing, Lean Enterprise, or lean production, often simply, ‘lean’, is a production philosophy that considers the expenditure of resources in any aspect other than the direct creation of value for the end customer to be wasteful, and thus a target for elimination”.
The above excerpt is a quote from Tim Berry’s book “Lean Business Planning: Get What You Want From Your Business”.
A lot of the time people think that a lean business means you need to shred a lot of resources, but to the contrary, it just means running at the right level with minimal waste. According to Berry, it’s the Goldilocks of business strategies providing the perfect muscle:fat ratio:
“In general, lean means strong with muscle but no fat. Leans means useful. It’s not thin, not skinny, just lean”.
In general, a lean business model is one that strives to eliminate waste in product and processes while still managing to satisfy customers. The Ship-from-Store method should be adopted as a lean business process because it doesn’t require additional assets such as printers or shipping labels to get the strategy off the ground.
There is a lot of debate around the idea of running a lean business though because some business leaders believe that making your business too lean can actually impact productivity. But in the case of Ship-from-Store, we don’t believe this is the case. Take a look below for a full description of what shipping from store really is and what it entails.
What is Ship-from-Store?
eCommerce has morphed the traditional brick-and-mortar retailers into a totally new beast. There is no longer one standard fit for what a retailer should look like, and ship-from-store is just another flavour in the retailer ice-cream stand.
Firstly, Ship-from-Store is relatively new when you compare it to traditional retail archetypes. If anything, you could even look at this strategy as the ultimate hybrid of the old and new.
In short, Ship-from-Store is the process where retailers use the stock available on their store shelves to fulfil orders. Maybe you have an online store, but no distribution centre, or maybe you have a really successful store in one location and want to branch out to new areas.
It’s fair to say that’s it much more economically friendly to start shipping from within your own store than it is to set up a new distribution centre, start paying extra space rentals and divvy out even more cash to warehouse pickers and packers. If you’re interested in reading a real-world example of how a retailer began shipping from store, we’ve got a great case study with Superpharmacy and how they implemented this strategy you can read here.
Shipping from store is the happy medium between having a physical and online presence. Sounds amazing, doesn’t it? Well, it is…. but it doesn’t come without its considerations first. See below for what you need to consider before you use this strategy to grow into new markets.
What You Need to Consider
Yes, it’s true: if you have a brick-and-mortar store or even more than a few, you have an endless aisle of stock available at your fingertips. But before you jump the gun and start briefing your staff about which couriers you’ll be using to ship from store, consider the technology and infrastructure requirements first:
What infrastructure do you need?
If you want to open to a new online marketplace and feel that shipping from store is the best way to go about it, one of the first things you need to consider is the amount of counter space you have for additional label printers.
It sounds really small and almost like an afterthought, but if you don’t have the counter space to fit another printer, you’ll need to think of where your orders are being printed from, and how you can best manage that process.
If you’ve never shipped orders for the online market, then you may not be aware of some of the elements that are required to ship orders to your digital customers. You’ll need:
- Courier satchels
- Shipping cartons
- Shipping label printers
- Shipping labels
- Bubble wrap
(If you weren’t aware, Shippit actually has all your shipping supplies at low, low prices, check them out >> )
The elements above may not look like much, but if you’re already fighting for stock space as it is, where will you fit all your shipping supplies? Just something to consider.
How easily can couriers access your store?
Many retailers Shippit works with experience a lot of frustration waiting for couriers to get through congested shopping centre loading docks. If you’re planning on offering priority shipping including 3-hour delivery or even same-day, then the amount of time it takes your couriers to get in and out of the shopping centre can really make a difference to delivering on your customer promises.
Even if your store isn’t in a shopping centre, it’s worth considering if your store is located on a traffic-heavy street and whether or not a courier would get bogged down.
Or maybe, like many starting up and growing businesses, you don’t need to worry about courier pick-ups because you plan on going to the Post Office to ship your parcels. If that’s the case, although this isn’t recommended, then you’ll need to consider when you go to the Post Office, how this will impact your store traffic and sales, and whether or not you’re able to offer your customers priority services if you’re only using one courier service. We cover the case for using more than one courier in this blog post.
How will your staff prioritise online orders vs in-store customers?
We get it. You’re a retailer looking to maximise in-store conversions and at the end of the day, every sale counts. You want your staff to really make the most of every opportunity that comes in the door and you’ve given them great incentives to try and upsell as much as possible.
So what happens when you tell them to start taking their attention away from the in-store customers to make sure online orders are fulfilled within the agreed service level?
If your in-store staff are purely focused on converting sales within the store, you’ll run the risk of neglecting your online orders. You’ll need to get team buy-in before you implement this strategy because the happiness of your online customers depends on it.
Make sure you train your staff and incentivise fast picking and packing so that the order is ready to go when your courier arrives.
As business owners, the urge to grow is innate. There is nothing more exciting than opening your products up to new markets and revenue streams.
In the eCommerce era of growth, the great thing is that you can turn your brick-and-mortar stores into mini-distribution centres. This means you don’t have to sink new costs into renting a warehouse or paying for pickers and packers because you most likely already have those assets.
You really can ship-from-store if you have a physical location, you’ll just need to consider:
- How much space you have for label printers and courier satchels
- How easily and quickly couriers can access your store
- How easy will it be to get your in-store staff to think the same about online orders as they do about in-store customers
If you’re ready to ship from store, then contact Shippit’s solution experts about our easy, cost-effective shipping solutions.