Omnichannel distribution focuses on creating a seamless shopping experience for customers. Customers want consistency and integration across all channels. This includes shopping online, via the telephone, or at a brick-and-mortar store.
As a new and complex concept, omnichannel networks can be daunting for many firms. Decision-makers need to consider many factors before making a decision. These decisions may involve a shift in business operations or a large investment in tech. Changes of this scale can be overwhelming for many companies. However, if an omnichannel network is properly implemented, the benefits will greatly outweigh the cost.
So what are some things that need to be considered?
Operational Synergies and Shifts
One of the first things to consider is the operational systems in place. Take a look at how each of your organization’s channels operate at each stage of the supply chain. Then, identify any similarities or major differences from channel to channel. Maybe you use the same type and method of packaging for your eCommerce and retail channels. You can use this to your advantage to make these products readily available at more locations.
Now, assume the organization has a wholesale channel that uses a different type of packaging. This is a situation where a company could consider making operational changes to increase the synergy in its channels. Identifying these similarities is a great place to start when implementing an omnichannel network. This is because it helps to map out where a company is and where it needs to head.
Technological Investments
With an omnichannel network, technology can play a huge role in managing complexity. At this point, much like with general operations, a firm would see what tech are already in place along a supply chain. Then, they could determine what changes would be beneficial. By doing this, firms can use current knowledge and expertise to create a seamless experience for customers.
For example, let’s say a company already has an inventory system with barcode scanning for in-store retail locations. With omnichannel, a company can now look to better connect eCommerce and in-store retail channels. Since the organization already has this tech in place for its brick-and-mortar locations, using the same tech can save time and money. As a result, the company already has a reliable service provider and workers that already know how to use the system. Technology can be difficult to implement into supply chain operations. For this reason, making use of current assets can ease this process.
Distribution Center Location
In terms of Distribution Centers (DCs), companies have many options. They can use existing warehouses, pay for outsourced locations, build new locations, and more. An emerging trend in companies with these networks is using store locations as DCs. Doing this not only expands their DC reach, but it also opens new options for delivery.
Many retailers made use of this strategy over to introduce the “pick up at store” delivery option on their website. In addition, many retailers use completely separate DCs for each of their channels. One thing to consider when implementing an omnichannel network is to merge all DCs across the organization. Setting it up this way ensures all DCs can facilitate delivery for any channel. This can help build a seamless experience from the inside out.
Inventory Management System
Another major decision that companies need to make is which system to invest in. To succeed in omnichannel, a firm needs visibility at all stages of its supply chain. An effective inventory management system can help achieve this. There are many variables that will change based on your needs. However, to create a truly seamless experience, the same system should be in use across all channels. For this reason, the more complex of a supply chain, the more customizable a system should be. It is important to find a system that can cater to individual needs. But, also without great cost. This will help achieve the seamless visibility for omnichannel.
There are many things that should be taken into account before setting up an omnichannel distribution network. The points listed in this post are just a few within a bigger picture. However, when it comes to such a complex network it is important to take time and do it right. Making such large changes can be overwhelming at first, but in the long-run it can greatly contribute to the growth and success of any organization.
