Ship from Store Provides a Store to Front Door Logistics Solution

 

What do you do if you are a major “brick and mortar” retailer who’s losing sales and revenue from a major online retailer?  You compete! 

For years, Best Buy, Wal-Mart and numerous other big name retailers have lost sales and much needed revenue from the online giant Amazon. As the largest online retailer, Amazon sells almost everything a consumer could want and those products are conveniently shipped to the address of your choice anywhere in the world.  Today, retail therapy is frequently achieved in the comfort and convenience of the shopper’s home.

This convenience can come at a price though.  Some products found online may be cheaper than those found in your neighborhood stores, but not always.  Products bought online require the added cost of shipping which can add to the overall cost. However, competition for sales often means a reduction in the retail cost of goods sold online.  It seems many people do not mind paying a little more to avoid the hassle of trekking into their local retailer.

Though most consumers may not be aware of this new trend, ship from store has quietly been around for a couple of years.  Wal-Mart, the world’s largest retailer, started ship from store about two years ago.  They currently utilize this process at 35 stores across the country.  Wal-Mart has over 4,100 locations in the US with plans to scale this operation to hundreds of stores in the very near future.  The company recently stated that over 10 percent of items purchased on their website are shipped from one of these 35 stores and the delivery time usually takes less than two days.

The consumer electronics giant Best Buy has implemented ship from store at 50 locations across the US.  The company estimates that shipping from their many locations could generate an extra $5.8 billion in sales and $168 million in profit next year; definitely motivation to expand the service to its more than 1,000 US locations.

Best buy and Wal-Mart are not alone in this savvy marketing reboot. Target, Nordstrom, Macy's, Lowe's, Gap, Dick's Sporting Goods, Ann Inc. and Finish Line have all implemented ship from store operations.  Wal-Mart and other big retailers hope that, by turning stores into shipping hubs for online orders, they can re-create Amazon's fulfillment network with the locations they already have in place.  The online retailer Amazon has 100 warehouses located across the country but this number pales in comparison to the more than 5,100 potential shipping locations of just Wal-Mart and Best Buy alone.

Convenience for the consumer is not the only benefit of ship from store.  There is the obvious profit potential in this opportunity that is driving retailers to implement ship from store at a record pace.  Consider this example.

Just a few years ago, ordering a product on a retailer’s website required the retailer to have the product in one of their centrally located warehouses.  If the product was not in stock at the warehouse, there was no sale.  Chances were, the desired product could be in hundreds of individual store locations across the country but because it was absent from the main shipping warehouse there was no sale.  Ship from store eliminates this scenario.

Ship from store makes in store inventory available online for web shoppers.  This inventory can easily be packaged and delivered to web shoppers directly from the closest store carrying the desired product, anywhere in the US.  As more physical store locations implement ship from store availability, there should never be an instance where what you want can’t easily be obtained unless that product just isn’t available anymore.  

As with any positive improvement there is usually a negative or two and there is a downside to the convenience of ship from store.  Discounted prices or in store sales on products may become a thing of the past as there will always likely be a demand for every product at full price on the Internet.  This would mean you should always be able to find what you want when you want it, as long as you don’t mind waiting a couple of days.