Amidst the current pandemic situation, retailers are indeed a concerned lot. On one hand, business is impacted because of lockdowns & restrictions. On the other hand, customer preferences & expectations are changing by the day & requires retailers to adapt to newer buying behaviors quickly. In the current digital world, if a customer does not find what he needs in a retailer's aisle, he moves on and buys from another online store or a competitor store. This poses a unique challenge for retailers - How to stock every item on their shelves so that customers get served in a timely manner? Neither do they want to incur inventory holding costs nor do they want to have additional labor costs. Is there a seamless strategy that can be pursued along with their respective vendors/drop shipping partners to ensure there is an unlimited range of products for their customers? The answer is yes and lies in bringing endless aisle to their stores.
What is “Endless aisle” ?
Since customer expectations have changed drastically in recent years, retailers need to improve their in-store & online experience based on the same. Today’s customers have too many offline & online options to conveniently purchase a product. Also the pandemic effect has had a huge impact on footfalls for retailers. The risk of not having an effective strategy to mitigate these scenarios will have a huge impact on business continuity.
With an endless aisle strategy, your customers can virtually browse your digital store or visit your stores & place orders for even out-of-stock items. These will be processed centrally at the Retailer’s end and routed to the Retailer’s suppliers in a hyper local model. The supplier in turn will have them shipped to customer homes directly. Customers will not even know that the store did not have the inventory and hence the whole experience is seamless. Store employees can also look at the extended inventory and place orders on drop shipping partners for fulfilment. This way, retail stores are rest assured that they will never run out of stocks. Retail stores can use digital kiosks, touchpads or even mobile apps for customers to interact and place orders. In cases where stores are crowded and busy or whether a customer prefers contactless delivery, endless aisles can serve the purpose very effectively & also ensure a better experience for customers.
Benefits for Retailers:
There are several benefits and few are listed as below:
- No lost sales & revenues – One of the major issues that retail stores face is inventory holding costs & also limited shelf space in certain instances. This results in product stockouts and loss of sales.
- Increased assortment of Product Portfolio & Supply – Leveraging supplier’s inventory means you have extended broader product assortment and stocks for customers to choose from.
- Minimize Cost – Retailers can save on two kinds of costs - Inventory as well as operational costs i.e., shipping & handling costs.
- Increased customer satisfaction – Customer gets what he wants all the time and in the most convenient manner. Helps in building loyalty.
Retail stores will have significant benefits when they implement an endless aisle strategy. However, they should also note that this comes with several challenges.
- Technology implementation - Centralized Order Management System with integrations with drop shipment partners / vendors, inventory update on real time basis.
- Training and empowering staff - Equipping Store personnel and Backend operational staff with relevant training and Order handling processes & guidelines
- Effective partner management - Processes in place for order management & fulfilment as per Service levels agreed and also communication with suppliers. Last but not the least, having a proper reconciliation system for accounting.
It is obvious that endless aisles are proving to be a very effective strategy for retailers of all sizes and segments . It is also a concept that is set to become the mainstay among new-age retailers to create the most effective merchandising strategy - be it as a fulfilment model and/or virtual shelf. The ultimate goal is to offer an endless number of SKUs in collaboration with drop shipping partners. Invenzo Labs is helping many retailers implement an endless aisle to their stores with its award winning software platform and solutions. To know more about Invenzo Labs, Please visit www.invenzolabs.com