Effective Retail Shipping in the Omnichannel Age

Cloud-based TMS software provides tools needed to achieve transportation optimization

Omnichannel retail is the 500-pound gorilla all supply chains want and fear. According to MarketWatch, the global omnichannel retail market will see a compounded annual growth rate (CAGR) of 21.48% through 2023. While omnichannel enables multi-channel approaches to increase efficiency and improve sales opportunities, challenges remain. Shippers that wish to ensure effective retail shipping in the omnichannel age need to understand the risks within omnichannel retail shipping, how omnichannel shipping and visibility work together, and a few best practices to guarantee its success.

What Risks Reside Within Omnichannel Retail Shipping?

According to Retail Pro, shipping costs are a leading reason for abandoning online carts and result in the loss of approximately $18 billion in revenue annually among shippers. The problem is simple. Customers want free, fast shipping. Unfortunately, giving customers fast, free shipping does not always amount to making a profit. As a result, retail shipping becomes the beast of burden in succeeding within omnichannel retail. Shippers must also understand that omnichannel implies the use of the Internet in all transactions, creating a seamless approach from the brick-and-mortar experience through the online experience. Therefore, higher shipping costs, even when items are being shipped or fulfilled from a storefront, will amount to additional problems and expenses.

Omnichannel Shipping Requires Better Service, Lower Rates, and End-to-End Visibility

Omnichannel is an opportunity to expand operations. The online commerce process is something shippers would like to ignore. Its complexities and surging growth can feel overwhelming and unsustainable. The reality is that omnichannel will continue to grow, despite those retailers that wish to remain a mostly traditional multi-channel operation. Retail shipping means balancing the cost of offering better service and lower rates with real changes within the supply chain.
Most importantly, omnichannel and end-to-end visibility go hand in hand. Without visibility, the supply chain suffers, and customers do not know when their products will arrive. On the business-to-business perspective, a lack of visibility results in poor replenishment practices, not to mention the inability to take advantage of innovative shipping models, including drop-shipping and cross-docking.

How to Ensure Effective Shipping in Omnichannel

To safeguard retail supply chain processes and enable omnichannel success, shippers need to follow a few steps. These include:
  • Build your services and capabilities around the customer experience. Focusing on the customer experience has a proven record of boosting customer service and driving sales, explains Jeremy Bodenhamer of Entrepreneur magazine. In other words, shipping in omnichannel retail depends on customer needs and wants, so shippers need to ensure customers can see all shipping options from a single platform.
  • Unify your supply chain strategies into an overarching, centralized database. While operating in silos was great for a channels approach, omnichannel requires a blending of information across all platforms. It is impractical to upgrade all systems. But, the next best thing is integrating systems to work together and to rely on a unifying platform, such as a transportation management system (TMS), to provide the connection.
  • Take advantage of localized services, including returns. Physical locations can handle many of the challenges created by omnichannel retail, including higher return rates. More importantly, returns and visits to brick-and-mortar locations will naturally lead to increased customer activity and business for your brick-and-mortar stores.

Implement a Modern TMS to Safeguard Retail Shipping Strategies Now

A modern TMS is a necessity for omnichannel retail. There was a time when omnichannel gave retailers a competitive advantage, but today’s customers expect omnichannel. It is not enough to offer a few products online. Customers want the world online. Instead of risking everything, shippers need to reevaluate their retail shipping strategies to meet omnichannel demand.

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Phil Melton
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