Retail operations
Session 1
Retail operations definitions:
- The sale of small quantities of items to end consumers, as opposed to wholesale, which
involves selling to business or institutional customers.
- Activities involved in the selling of physical goods or services to ultimate customers for
personal or household consumption
Some characteristics for retail:
- Highly regulated
- Low productivity
- Thin profit margins
- Globalizing
- Rapid influx of technology
Reverse supply chain is concerned with retrieving, reusing, and recycling end-of-life products
Session 2
Omnichannel retail: Providing customers with seamless journeys across all available channels
Showrooming (offline to online):
- Convenience
- Lower online prices
Webrooming (online to offline)
- Not wanting to pay for shipment
- Like to touch and feel the product before they buy it
,Ominchannel fulfillment:
- Click and collect
o Two types:
BOPIS: Buy online, pick up in store
ROPIS: Reserve online, pick up in store
Only difference is moment of payment
o Benefits for consumers:
Instant gratification
Guaranty availability
Save time
Save on delivery costs
Obtain advice on the usage of the product upon pickup
o Benefits for retailers:
Brings the consumer to the store
Build brand loyalty
Save on last-mile delivery costs
o Challenges:
Inventory accuracy
Information systems
- Ship to store
o Challenges:
Using click & collect with ship to store could lead to more fragmented
demand, which increases inventory costs
Transportation costs can grow due to inefficient shipments between
distribution center and store
- Ship from store
o Benefits:
Pool inventory between online and offline channels
Deliver faster
, Reduces delivery costs
o Challenges:
Combining the order picking and packing with other activities in the store
Organizing delivery
Matching irregular demand for service with supply of fulfillment slots
Vendor fulfillment two options:
- Benefits of drop shipping to the platform:
o Lower capital investment: Not holding inventory
o Lower financial risk
o Ability to quickly offer a broad assortment
- Benefits of drop shipping to the vendor:
o Good way to increase distribution
o Potential for increasing profit margins
o More knowledge on customer base
Omnichannel retail strategy:
- Organization-level key performance indicators should be leading
- Remove friction where it matters to consumers and where it pays off
- Identify actions per customer journey stage or the connection between different stages
- Use ‘derived KPIs’ that can be linked to the organization-level KPIs
- Empower employees to identify and implement improvement actions in an agile way
Session 1
Retail operations definitions:
- The sale of small quantities of items to end consumers, as opposed to wholesale, which
involves selling to business or institutional customers.
- Activities involved in the selling of physical goods or services to ultimate customers for
personal or household consumption
Some characteristics for retail:
- Highly regulated
- Low productivity
- Thin profit margins
- Globalizing
- Rapid influx of technology
Reverse supply chain is concerned with retrieving, reusing, and recycling end-of-life products
Session 2
Omnichannel retail: Providing customers with seamless journeys across all available channels
Showrooming (offline to online):
- Convenience
- Lower online prices
Webrooming (online to offline)
- Not wanting to pay for shipment
- Like to touch and feel the product before they buy it
,Ominchannel fulfillment:
- Click and collect
o Two types:
BOPIS: Buy online, pick up in store
ROPIS: Reserve online, pick up in store
Only difference is moment of payment
o Benefits for consumers:
Instant gratification
Guaranty availability
Save time
Save on delivery costs
Obtain advice on the usage of the product upon pickup
o Benefits for retailers:
Brings the consumer to the store
Build brand loyalty
Save on last-mile delivery costs
o Challenges:
Inventory accuracy
Information systems
- Ship to store
o Challenges:
Using click & collect with ship to store could lead to more fragmented
demand, which increases inventory costs
Transportation costs can grow due to inefficient shipments between
distribution center and store
- Ship from store
o Benefits:
Pool inventory between online and offline channels
Deliver faster
, Reduces delivery costs
o Challenges:
Combining the order picking and packing with other activities in the store
Organizing delivery
Matching irregular demand for service with supply of fulfillment slots
Vendor fulfillment two options:
- Benefits of drop shipping to the platform:
o Lower capital investment: Not holding inventory
o Lower financial risk
o Ability to quickly offer a broad assortment
- Benefits of drop shipping to the vendor:
o Good way to increase distribution
o Potential for increasing profit margins
o More knowledge on customer base
Omnichannel retail strategy:
- Organization-level key performance indicators should be leading
- Remove friction where it matters to consumers and where it pays off
- Identify actions per customer journey stage or the connection between different stages
- Use ‘derived KPIs’ that can be linked to the organization-level KPIs
- Empower employees to identify and implement improvement actions in an agile way
