Likewise, asked whether they handled e-commerce fulfillment at the same facility where they
conducted traditional fulfillment operations, 69
percent of survey respondents said yes, with 31 percent saying no. (See Exhibit 2.)
Some of the companies engaged in omnichannel
distribution have opted to outsource the entire
operation, hiring a third-party logistics service provider (3PL) to handle the fulfillment end of their
e-commerce operations. We asked survey takers
about their strategies, and found the answers were
pretty evenly divided. The results showed that 68
percent relied on their own corporate (internally
managed) distribution centers, while 50 percent
used sites operated by their outsourcing partners.
Those figures add up to more than 100 percent,
indicating that some companies are taking a combined approach.
Within the warehouse, workers use a wide variety of methods to select items needed to fill these
orders. Asked what technology order pickers use
to fulfill orders from a traditional DC, respondents
cited the following: warehouse management systems (WMS) with radio frequency ( 63 percent),
voice recognition systems ( 24 percent), pick-to-light technology ( 24 percent), paper-based WMS
( 26 percent), and goods-to-person automation ( 18
percent).
Their managers also use a range of tools to support omnichannel commerce initiatives. When we
asked respondents what technologies they used,
the top three answers were high-end warehouse
management systems (91 percent), demand management software ( 72 percent), and basic bar-code
scanning on the store floor or in the backroom ( 61
percent). (See Exhibit 3.)
DELIVERING THE GOODS
A crucial link in any omnichannel fulfillment oper-
ation is the final step: getting e-commerce orders
into customers’ hands. Here, the options range
from in-store pickup to home delivery. We drilled
into current practices in this area as well as respon-
dents’ plans for the future. What we found was that
e-commerce delivery is an area that’s very much in
flux.
The responses to our first question—“How do
you handle ‘last mile’ deliveries?”—contained few
surprises. The most popular answers were courier delivery services such as FedEx and UPS (84
ABOUT THE STUDY
This year’s omnichannel study was conducted by ARC Advisory Group in conjunction with DC VELOCITY. ARC analyst
Chris Cunnane oversaw the research and
compiled the results. The 2015 study
builds on research done last year in this
area, which found that significant opportunity gaps exist among companies from
a technology deployment standpoint.
This year’s study explored the details
of DC operations to support omnichannel initiatives, as well as how companies
are handling the last-mile dilemma. The
findings reported here are based on 120
responses.
As for the demographic breakdown,
the majority of respondents ( 57 percent) sold goods through a combination
of direct and indirect sales channels.
Another 31 percent sold through direct
retail only, and the remaining 12 percent
through indirect sales channels only.
A report containing a more detailed
examination of the omnichannel survey
results is available from ARC for a fee.
For information, visit www.arcweb.com/
research.
