Omni-Channel Retail Vision

Size: px
Start display at page:

Download "Omni-Channel Retail Vision"

Transcription

1 Omni-Channel Retail Vision Chris Jones October 15, 2013

2 Agenda The Traditional View New Thinking The Enablers Leading Companies

3 Omni-Channel => Seamless Selling, Disparate Delivery Prohibitively expensive Inconsistent service No visibility Has Omni-channel made retailing a battle of attrition?

4 Laws of Service Versus Cost Cost Customer Centric Service Profit Resource Centric Low Service High What has to change to break the traditional rules of logistics?

5 Same Day, Next Day Conundrum The market disruptors are doing it of those Amazon shoppers who saw that [same-day] icon and then made the purchase, most of them ended up not using same-day delivery, opting instead for next-day StorefrontBacktalk Do consumers want same day or do they really want choice?

6 Serial Delivery Process Mentality Lose/lose strategy and process Customer is not happy with the inflexible choices Retailer plays a distribution guessing game with capacity and costs Traditional home delivery process Step 1 Sell product Step 2 Offer fixed delivery options Step 3 Determine how to get it executed cost effectively What could you do if delivery promising was part of the buying process?

7 Agenda The Traditional View New Thinking The Enablers Leading Companies

8 Omni-Channel Fulfillment Consistent/differentiated service End-to-end visibility Supply chain leverage Large Goods Small Package Private Fleet 3 rd Party Supplier Omni-channel has to be just as seamless on the back end as it is on the front end

9 Service AND Revenue AND Profit Premium Delivery Times Value Added Services Delivery is no longer about getting it done, it s about getting more

10 Profitable Choice Route Stop# Date Cost Time Window 1 4 April 26th :00am 11:00 am Cost of delivering via Route 1: April 27th :00 am 1:00 pm 1 12 April 27th :00 pm 5:00 pm Cost of delivering via Route 2: April 26th :00 pm 6:00 pm Legend Route 1 Route 2 Give customers options that don t erode your margins

11 Accelerating the Flow While Maintaining Control Suppliers and carriers need to be integrated into a single system that merges order and shipment information Supplier Carrier Retailer In-transit deployment Load flow control Dynamic echelon skipping Retail ready merchandise To effectively deliver same/next day your supply chain must operate in minutes and without any blind spots

12 Agenda The Traditional View New Thinking The Enablers Leading Companies

13 Dynamic Delivery Appointment Promising Online Purchase Actual route optimization provides options in ~ 1 second Considering: Revenue Costs Routes Vehicles Roads Skill Sets Unload times Time Windows 7am-9am 9am-11am Customer Delivery Options Wednesday 24 April 2013 Free Standard Delivery Thursday 25 April 2013 Premium Delivery ($10.00) Friday 26 April 2013 Saturday 27 April 2013 Same Day Delivery ($25.00) Sunday 28 April 2013 Monday 29 April 2013 Logistics costs are dynamically generated for each slot allowing a retailer to determine the most profitable choices 11am-1pm

14 Dynamic Multi-Modal Delivery Management Optimize across all delivery modes Integrated optimization and execution Small Package Large Goods Cost Capacity Priority Click & Collect Supplier Eliminate trapped capacity and improve delivery flexibility

15 Closed Loop Customer Experience More than mobile or web Measure the Experience Confirm Capture the Customer Survey Notify Document the Delivery Deliver Track Minimize No shows Manage Disruptions This works no matter if fulfillment is in- or out-sourced

16 Integrated Inbound Logistics PO to ASN Commercial Logistics Catalog to Configuration Product BOL to Customs Filing Customs Getting In the Flow with suppliers and LSPs/carriers creates data leverage for streamlined and reliable inbound operations

17 Agenda The Traditional View New Thinking The Enablers Leading Companies

18 John Lewis: Defining Omni-Channel Excellence Single system for all retail channels Nationwide service One click to delivery for consumers Automated value added service attachment Increase value added services revenue Reduced mile/delivery by 13% Increased product revenue Full delivery service in Central London during the Olympics

19 Home Plus: Change the Format, Up the Delivery Ante Mobile/web order/delivery promising integrated with warehouse fulfillment Same day delivery 10 2-hour time windows daily 3 Delivery waves Meet delivery window promise Schedule drives picking and packing Increased sales volume Increased delivery compliance Improve picking/packing efficiency

20 CVS Caremark: Inbound Excellence $107B US pharmacy healthcare provider stores Stores, web, mail order Domestic inbound Most inbound freight supplier controlled Reduced inventory Reduced PO to receipt time Increased delivery accuracy Reduced warehouse staff Improved regulatory compliance Inbound Transport Yard Management Freight Audit Dock Scheduling Visibility Load Flow Control Primary Transpor t Supplier/Carrier Connectivity

21 SCI Logistics (e.g. Rogers Communications) Leading Canadian 3PL Small package services Retail, ecommerce and healthcare Integrated warehousing and transport management Peaking at 14,000 shipments daily Able to execute same day delivery Value added services customized to each delivery Customer notification Integrated returns processing starting with labeling Consolidation - zone skipping

22 Summary Fundamental shift in the importance and role of fulfillment Service based competitiveness Margin protection Service revenue growth Sell more product The battle is won at order Optimize across all fulfillment channels Execution across the supply chain is the last word

23 Network Applications Community