Omnichannel Fulfillment and Location of Distribution Centers
Customers demand an omnichannel shopping experience that allows them to order from anywhere. Therefore, the supply chain has to be able to deliver according to the consumer’s wishes. For example, retailers now include shipping from stores as a distribution option. This increased responsiveness to customers is changing the way a distribution network is set up and managed. Developing an omnichannel supply chain strategy requires rethinking the number and location of distribution centers, as well as their layout and design features.
Winning the Omnichannel Fulfillment Wars
Many traditional warehouse operations are not set up to efficiently accommodate a large range of orders with varying units and lines per order characteristics typical of multi-channel orders.
Omnichannel distribution centers seamlessly combine both e-commerce and traditional store distribution channels, but it requires significant capital investment in material handling, conveyor sortation and controls, optimized racking systems and lift equipment, inventory management software, and picking/packing technology.
Source: http://apparel.edgl.com/case-studies/Winning-the-Omnichannel-Fulfillment-Wars92316
Warehouse and Distribution Center Management: Omni-channel distribution—Moving at the speed of “now”
An increasing number of retailers will be distributing from their stores. Processing and shipping from the store that’s closest to the person that wants it is the most cost-effective way to support a next-day shipment. But there are some challenges with shipping from stores. For example, contracts with parcel carriers may need to be modified to handle this strategy. Some stores may not even have the space or the labor and you need real-time visibility into available store inventory.
Creating a whole new kind of business out of omni-channel retailing
The line between in-store and online commerce is beginning to blur. Most retailers will turn to outsourcing to a fulfillment center because of the massive investments involved in re-configuring their networks and processes.