If you’ve shopped online before, then you know the feeling of anticipation as soon as you hit Checkout. You wait with bated breath until your order arrives. But when shipping takes any longer than two days, you start wondering where in the world your package is. Before you start refreshing the Track My Order page on a minute-by-minute basis, take a moment and think about what this says about the modern consumer.
In most industry circles, they would point to “the Amazon Effect” as the reason behind these heightened expectations. What is the Amazon Effect? Well, it describes how the rise of e-commerce and leaders like Amazon have disrupted traditional retail models and shopping behavior.
Namely, having grown accustomed to the ease and convenience of e-commerce, modern consumers now expect:
- A large variety of product options
- Rapid shipping and deliveries
- Quick and frictionless checkout (à la 1-Click Ordering)
- Integration between online and offline retail (like what Amazon does with its bookstores and through Whole Foods)
The first two, in particular, have put added pressure on manufacturers, retailers and distributors when it comes to warehouse management and order fulfillment, whether they’re shipping directly to customers or to stores.
More choices, more SKUs
Think about the wide variety of products you have available at the click of a mouse today. For example, if you want to order chocolate, there’s a seemingly endless number of options, from the gourmet to budget-friendly, plain to exotic, or vegan to gluten-free. Previously, you were limited to whatever was sold at your local supermarket or convenience store.
Consumers now expect the same product variety from all companies. Many manufacturers have been more than happy to follow suit, leading to a proliferation of SKUs. But this can create challenges in warehouses once designed to handle a few hundred SKUs that suddenly have to deal with thousands—unless they’re properly prepared with optimal space-saving warehouse layout and technology.
Fast and furious expectations
Consumer expectations for delivery time have steadily gotten shorter and shorter with each year. In 2012, one study showed 5.5 days as the average delivery time that a consumer would expect. In 2016, that number dropped to 4.8 days. Today, two to three days is now the benchmark standard. We can thank Amazon Prime for that by introducing free two-day deliveries for subscribed members.
These new expectations for delivery time are pushing more organizations to look at ways to accelerate order fulfillment. Some are opening widely dispersed mini-warehouses to be closer to stores and customers in effort to shorten delivery time. Others are partnering with third-party logistics providers.
Increasingly, many are looking to warehouse automation, letting robots pick and move orders through a facility with high speed and precision. Notably, automated warehouses are six times more efficient and can run 24/7, which will be increasingly needed in the constantly on, e-commerce age.
To learn more about accelerating order fulfillment, as well as the benefits of automation in these fast-paced times, download eBook, “Warehouse automation: Built for speed.”
Author Lori Vaughan