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Overcoming capacity challenges

Updated: Sep 15, 2023

The key to an efficient click & collect retail experience

As online shopping continues to grow in popularity, more retailers are offering Click & Collect as a convenient option for their customers. Click and collect allows customers to purchase items online and pick them up in-store, avoiding the hassle of shipping and delivery times. While this option can be beneficial for both retailers and customers, it also presents capacity challenges for retailers to manage effectively.

The Impact of Coronavirus

In 2020, the pandemic wreaked havoc on the retail sector, forcing retailers to quickly develop and implement various Click & Collect solutions. However, many of these solutions were hastily created, transactional in nature, and lacked sophistication in terms of enhancing customer satisfaction and in-store efficiency.

Fast-forward three years, and retailers have experienced a significant increase in the adoption of Click & Collect services such as buy online pick up in-store, curb-side pickup, and locker pickup.

So, what happened to retailers who promoted Click & Collect and experienced this growth? Some have chosen to stick with their old pandemic-era solutions, while others have updated their existing systems. The most agile retailers have implemented new, modern solutions based on artificial intelligence, providing a more seamless and efficient Click & Collect experience for their customers.

Going into the near future it is not about having a Click&Collect solution to offer your customers, it’s about having a better solution than your competitors to gain more market shares and happy customers.

The Benefits for Retailers

Real-life data has demonstrated the significant benefits that brands can obtain by implementing Click & Collect solutions. Brands that offer flexible pickup options and elevate the overall customer and retailer experience through Click & Collect solutions have seen a substantial increase in conversion rates and basket size. In the fashion industry specifically, leading brands have experienced these benefits through the implementation of Click & Collect solutions, which not only provide convenience to customers but also offer upsell opportunities. These data-driven insights highlight the immense value of Click & Collect solutions for businesses looking to improve customer retention, increase sales, and enhance the overall customer experience.

Common Challenges

In this article, we'll explore some of the capacity challenges that retailers offering Click & Collect may face and how they can overcome them by using technology based upon Artificial Intelligence.

Challenge 1: Limited Space

One of the biggest capacity challenges for retailers offering Click & Collect is limited space. Retailers need to have enough space to store items that have been purchased online but not yet picked up by customers. This can be particularly challenging for retailers with, limited backroom space, high volumes of online orders or simply small stores.

Many retailers consider implementing a system that automatically allocates space for Click & Collect orders based on the size and volume of orders. They also investigate utilising third-party logistics providers or partnering with nearby stores to serve as pick-up locations. This will not solve the retailers pains in the long run because Click&Collect orders will increase.

A system based upon AI will tell the store staff when to pick the individual orders in due time before it is picked up. The system will know about the storage capacity and tell the store staff to pick in a combination of quiet periods in the store and as close to the pick-up time as possible. This will bring down the need for space capacity in each store.

Challenge 2: Staffing and free pick-up time slots

Another capacity challenge for retailers offering Click & Collect is staffing and number of free pick-up time slots throughout the day. Retailers need enough staff to service customers in store, manage online orders, prepare items for pick-up, and handle customer inquiries. However, staffing can be a difficult and costly task, particularly during peak times such as holiday seasons or sales events.

To overcome this challenge the answer is not to hiring more staff or temporarily staff, the margins are already under pressure and putting more retailers can consider cross-training staff members to manage multiple tasks or hiring temporary staff during peak periods. Retailers can also investigate implementing automation technology to streamline the Click & Collect process and reduce the need for manual labour.

Challenge 3: Technology

Technology can also present capacity challenges for retailers offering Click & Collect. Retailers need to have an efficient and reliable system in place to manage online orders, inventory, and pick-up processes. However, outdated, or inadequate technology can lead to errors, delays, and frustrated customers.

To overcome this challenge, retailers can invest in a robust and integrated technology platform that can handle all aspects of the Click & Collect process. This can include an online ordering system, inventory management software, and a customer relationship management system.

AI is the future

Artificial Intelligence (AI) used in the right way can increase in-store efficiency and customer satisfaction. AI refers to algorithms designed to solve specific problems or provide particular services. It seems to be everywhere. For example, ChatGPT has been all over the news recently and is a fitting example of artificial intelligence that improves chat performance, communication, and customer service.

How Inovretail can help

Inovretail is an international company that specialises in AI-based Click & Collect and In-Store Efficiency solutions. Through working with large, mid-range, and smaller retailers, we have identified that capacity problems are a common denominator for all of them when handling Click & Collect. The key is to increase delivery time capacity, optimise order picking with the right staff, and schedule it as close to delivery time as possible or during quiet store periods. This prevents overfilling storage capacity in-store, at pickup points, or in lockers. Additionally, having the right products available for the stores allows for shorter delivery times to be managed effectively.

In response to these capacity problems, Inovretail has developed an AI-based Click & Collect solution that optimises order picking in-store, ensuring it happens at the most efficient time for each store with the right staff. The solution also enables staff to communicate with customers based on input from the AI, and even generates a task list for the store manager highlighting areas for improvement.

Lady shopping in fashion store

Closing Thoughts

As online shopping continues to grow, Click & Collect will become an increasingly popular option for customers. However, retailers need to be prepared for the capacity challenges that come with offering this service. By addressing issues such as limited space, staffing, and technology, retailers can provide a seamless and efficient Click & Collect experience for their customers.

However, instead of using the right technology, many retailers are resorting to increasing store storage and adding more labour hours. This approach is not sustainable and may not be the most effective solution. By failing to integrate the appropriate technology into their operations, retailers may struggle to keep up with the pace of change and meet customer needs. As such, it is crucial for retailers to embrace the latest technology solutions to optimise their operations and keep up with the evolving demands of their customers.

Retailers who fail to keep up with the fast pace of technology implementation risk losing customers and rapidly reducing their margins. However, by utilising continuously updated and cloud-based artificial intelligence technology, retailers can increase in-store efficiency and customer satisfaction without negatively impacting their already tight profit margins.

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