DC Velocity - November 2016

b Return to store, even when goods are ordered online ( 65 percent)

b Inventory rebalancing, shipping excess inventory from one store to another ( 54 percent)

b Order at store, fulfill from another store ( 42 percent)

b Parcel return, even when goods were bought in a store ( 32 percent)

As for how respondents fulfill online orders, the answers were all over the map: 75 percent said orders were fulfilled through a traditional DC that also handles e-commerce, 44 percent said orders were filled from a store, 38 percent said items were shipped directly from a manufacturer or supplier, and 32 percent use a Web-only DC. It should be noted that respondents were allowed to select more than one response, and as the percentages indicate, a number of those companies are using multiple methods. (See Exhibit 1.)

With three-quarters of retailers fulfilling orders from multiple channels in a single facility, that approach is clearly a foundation of omnichannel practice. And as our survey made clear, they’re not backing off from that practice. Seventy-seven percent of respondents to this year’s survey said they handled e-commerce fulfillment and traditional fulfillment at the same facility, an increase from the 69 percent who answered the same way in last year’s survey. (See Exhibit 2.)

Retailers are taking orders from a diverse range of sources. In fact, when it comes to ringing up sales, it appears all doors are open: 86 percent said they took orders online (including mobile), 77 percent said brick and mortar, and 42 percent said call center and catalog. (Totals came to more than 100 percent because most businesses support multiple channels.)

Although many retailers are fulfilling orders from
multiple channels in a single building, our survey
also revealed that there is plenty of room for them
to merge those operations more completely. When
we asked whether respondents’ e-fulfillment oper-
ations were segregated from traditional fulfillment,
ABOUT THE STUDY
This year’s omnichannel study was con-
ducted by ARC Advisory Group in con-
junction with DC VELOCITY. ARC analyst
Chris Cunnane oversaw the research and
compiled the results. The 2016 study
builds on research done last year in this
area.

The 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 109 responses. Respondents included logistics professionals from a variety of industries, who submitted answers between May and August of 2016.

As for the demographic breakdown, the majority of respondents ( 63 percent) sold goods through a combination of direct and indirect sales channels. Another 27 percent sold merchandise through direct retail only, and the remaining 10 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.