Post Date : April 13, 2022
In the midst of one steamy meeting at my 24th floor office, I missed a few calls from an unknown number. I received the call with a disgruntled “who is it?”. In response, there was an assertive voice, “Sir, I am here at the ground floor with your ‘out for delivery’ parcel. I made the 3 mandated phone calls to you and (your parcel) will be now leaving in 5 minutes.”
I recollected in a flash moment that it was anniversary gift I ordered online, to be gifted that evening itself. [Yes, I am the amongst the few who do remember dates]. I rushed down to collect the parcel JIT. It was an Eastman colour movie moment “your mother is in our custody; if you do not…” I guess the old-time movie goons were more accommodating and allowed breathing time and location for the bag of ransom to be dropped.
Smart Logistics practitioners do find inspiration in odd places. Let me introduce you to BOPIS (Buy online, pick at store), aka ‘Click & Collect’. Retail is a reflection of our modified lifestyle. Most of the shopping behavioural shift of last 1.5 years (pandemic) is likely to continue. Shoppers are progressively demanding for better delivery experience, and seek flexibility and control for their deliveries. They often abandon the cart if their expected delivery option/window is not available.
Customers seek delivery times now in hours and not days. With the recent exponential growth in ecomm sales, last mile logistics has become a furthermore important part of retailers’ brand promise.
Even physical MT (and many traditional) stores have speedily adapted to fast changing shopping behaviour. Providing the last mile delivery convenience is one of their strategic interventions. With hybrid workday-weeks at office, it is going to be difficult to predict which date-hours one would be at home or at work.
If you have chosen the BOPIS option at the time of order placement, retailer will send online alert (SMS/email) when the parcel is ready for pickup at the store. The pickup could be at the store window or at the parking lot where a store assistant loads your parcel while you sit comfortably in your car.
Stores typically fulfil the order in 1-3 hours. Most important benefit of BOPIS is the same-day order fulfilment. While pure play online retailers would not be able to offer BOPIS, they can charm the shopper with alternate versions, viz. BOPIH (Hub) and BOPIL (locker).
‘Click and Collect’ is being offered to the convenience of your gym lockers too (BOPIL). I know of a start-up in Spain that has placed lockers (e-Box) at strategic daily routine points (metro station, market places, shopping mall). Shopper can unlock his locker with an electronic key at her own comfort. You decide when and where to withdraw! The withdrawal takes less than 1 minute ! Locker Service is also best suited for shoppers who live in places with delivery restrictions, or those who cannot stay home for receiving the parcel during the day or those who want to keep the delivery confidential.
There are two more in the family: BORIS, ROPIS.
BORIS: buy online, return at store. Flexibility to return an item is important dimension of shopper decision making. RTO entails high-cost, loss for the retailer and supplier. In BOPIS deliveries, the RTO rate is negligible.
ROPIS: reserve online and pick-up at Store. In this option, shopper does not have to pay until she actually receives the product. This option works well when the stock supplies are limited in quantity and/or time-window (promotions, fresh produce are possible use cases).
BOPIS : Advantages for the retailer With 1 of 5 customers already choosing BOPIS, it should be considers as a ‘must have’ in your service offering. BOPIS service (omni-channel) helps retailers blur the boundaries between online and physical store, providing a seamless experience to the shopper.
The advantages are significant:
- Lowers last mile logistics costs. Due to significant costs per delivery, e-tailers keep minimum order size, and manufacturers also bundle products to achieve minimum order value size. BOPIS allows shopper to place smaller orders and choose from SKUs available at store.
- Increased Footfall to store (ghar wapsi): getting more shoppers to store gives an opportunity to up-sell, providing opportunity for customized marketing avenues.
- Higher inventory turns and product freshness: to make the best out of BOPIS, retailers merge their online Distribution Centre (DC) and store inventory tracking systems. Collective inventory is available for shopper, reducing stock-outs while the two systems worked separately.
- Faster order fulfilment: happier customers. Significantly reduced RTO (returns)
- Sustainability: this is a growing focus amongst the increasingly informed shoppers. BOPISis eco-friendly BOPIS; it reduces: i. Carbon footprint (reduced travel in last mile), ii. minimal wastage in packaging/ shippers’ material.
BOPIS : Disadvantages for the retailer
- Impact on Store efficiency: Same people, infrastructure servicing the walk-in shoppers and BOPIS shoppers would bring in inefficiencies. Resources need to be meticulously planned and optimized systemically.
- Brick & mortar stores only can offer BOPIS: for pure-play e-tailers, BOPIL is the alternate option.
- Wait time: the wait time for the customer visiting store to pick her stocks could be unnerving. IT enabled processes are required to ensure parcel readiness at the promised time. BOPIL at store premises may be considered as a costeffective, speedy, contactless solution.
- Absence of delivery address: customer legitimacy could be a concern. Fake customers/orders may lead to un-picked orders.
Challenges in implementing BOPIS
- Logistics and inventory tracking
- Managing and training store staff
- Fraud and customer information security
The Myths about BOPIS
- This can be done for certain types of products. Yes, it is currently popular for certain categories only…but it is a matter of customer choice. Consumers will choose BOPIS if it’s convenient.
- Too complicated to implement. Fact is there are easy ways to make it complicated. The rollout, staff training, and IT implementation have to be carefully planned for best benefits to retailer and shopper.
In 2018, Amazon premiered Amazon Go, a cashierless supermarket. Physical Amazon shops have been tested across the world. Some key aspects of physical shopping cannot be replicated online. The lines between on-line and physical stores continue to blur. My son recently researched pair of sports shoes online, then visited a physical store to try them on. Subsequently, he checked the competitive prices on-line and then placed an order for delivery at the store near our residence.
This article by Shammi Dua, Lead – Supply Chain CSL, Distribution at Unilever originally appeared in the SCM Spotlight segment for the December 2021 issue of Logistics Insider magazine. All views expressed in the article are his own and do not represent those of any entity he was, is or will be associated with.