OPERATIONS

Study: Store managers’ roles evolve in the unified commerce era

BY Deena M. Amato-McCoy

To effectively service shoppers at store-level, managers need to evolve beyond their sales roles and become “problem solvers.”

This means store managers must learn to master the combination of order fulfillment, inventory visibility and staffing to keep up with customer demands, according to the “Voice of Store Manager Survey,” a study from JDA Software Group. The second annual study is based on responses from 252 US-based retail store managers compiled in August.

As the lines between online and in-store continue to blur, order fulfillment (29%) and limited staffing (29%) are evenly split as the biggest challenges for retailers at the store-level. Meanwhile, inaccurate data (31%), and limited stock and slow replenishment (31%) are the biggest challenge for operations.

To solve these issues, the majority of store managers (64%) are using technology in some capacity to check store inventory availability in real-time. This could be via mobile or wearable devices (33%) or a central computer system (31%).

New fulfillment services are also being offered to deliver ease and convenience to busy shoppers, while luring traffic back into stores. Forty-four percent (44%) of respondents said their stores offer buy online ship from store services and 41% offer buy online pickup in-store (BOPIS). Meanwhile, 40% offer buy in-store ship to home, and 38% offer buy online return in-store (BORIS).

BOPIS services (41%) and buy online ship from store services (40%) have seen the largest increase in customer usage, though these options rely heavily on inventory visibility and staffing for pick, pack and ship to meet customer fulfillment timelines. In fact, respondents have staff allocated to support BOPIS (65%), BORIS (64%), buy in-store ship to home (61%), buy online ship to store (59%), and buy in-store ship to home/store from another store (49%).

Store managers believe lack of visibility across inventory (41%) is the biggest difficulty among BOPIS services. Despite this challenge, 36% of store managers said their stores currently offer a discount to customers who utilize BOPIS services. Another 14% are currently testing/researching options.

“As customer expectations continue to rise, it will be crucial for brick-and-mortar stores to streamline how they fulfill customer orders and work to draw in shoppers with incentives for in-store fulfillment options,” said Jim Prewitt, VP, retail industry strategy, JDA. “In the future, we foresee some stores evolving into distribution centers, fulfilling 100% of customer demand while others will morph into showrooms with centralized fulfillment.”

Another area needing improvement is the influx of inventory due to BORIS offerings — two in three store managers reported some difficulty with the service. Thirty percent (30%) of respondents are unsure of what to do with the additional inventory received through BORIS, and lack direction as to whether to keep it at the store, return to a distribution center or another store. Nearly 30% of store managers reported a staff-related concern with regards to BORIS.

While the “gig economy” is increasingly popular, more than 40% of store managers reported that only a small number of their store staff (less than 25%) are part of this segment. One in four store managers are exploring the possibility of leveraging additional labor – such as short-term contractors or freelance workers – outside of the traditional workforce.

Looking ahead to the 2017 holiday season, 60% of store managers plan to hire the same amount of temporary labor as they did last year 24% plan to hire more. However, the focus of the seasonal staff may be changing to meet customer demand. Over 40% of seasonal hires will be for fulfillment at stores/warehouses, not customer-facing. The other fulfillment area where store managers will increase hiring is BOPIS. One in three respondents will hire temporary staff specifically for the service this year.

“As store operations change with increasingly complex order fulfillment capabilities, the demands for staffing will change as well,” said Prewitt. “We predict there will be an uptick in tailored staffing hirers for both BOPIS and ship-from-store services.”

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