The retail sector has just undergone monumental change. As a result, there is an increased recognition of the importance of being agile—to respond as changes in the market and environment occur, even without knowing what those changes may be. To attain that agility, retailers have turned to technology.
As observed in the 2021 retail industry outlook by Deloitte, “We saw technological adaption that would normally have taken years, occur in a matter of months.”
All aspects of retail operations are streamlined and automated—from how retailers plan and build their stores and warehouses, to inventory management, payment, and customer service. This trend is expected to continue.
In KPMG’s Global retail trends 2020, it is estimated that in 2022, US retailers will invest $7.3 billion in the pursuit of greater AI integration across their operations, helping businesses with anything from their sales and CRM applications, to customer recommendations, manufacturing, logistics, delivery, payments, and payment services.
“Retailers require agility at all levels to protect, preserve, and innovate to deliver the new customer experience,” says Michael Colpitts, Oracle omnichannel solutions director in the blog post, Agility everywhere, creating a flexible store layout.
As is the direction in other sectors, multi-modal buildings are likely to become the norm for retail. Stores don’t have to be built with traditional fixed checkout counters thanks to technologies such as mobile point-of-sale solutions. Consider the wide-open spaces in Apple stores.
Additionally, improved inventory management systems allow retailers to quickly and easily locate and send a needed item to a customer, reducing the volume of inventory stored at a given retail location. Will warehouses and distribution centers built in more accessible locations be branded like stores and become the curbside pickup locations of the future?
Imagine that you place an order online and receive a confirmation code and the time your order will be ready. You stop by the drive-through pick-up on your way to work, scan your confirmation code, and your order is delivered to your car by a person or through an automated delivery system.
“The possibilities are almost boundless. The ability to take advantage of opportunities as they arise is critical to maintaining competitiveness. Flexibility that used to be a differentiator has become a competitive necessity,” says Colpitts.
Retailers must take a portfolio-level approach to capital program management across their various types of facilities to successfully manage retail’s fluid channels. Retailers need to have easy access to all relevant cost and cashflow information as well as inventory, to understand how their various locations and building types interrelate.
With this data in hand, retailers can plan and adapt physical spaces that best serve their customers at any given time and in any geography.
Another critical component in capital planning and execution is the ability for facilities to support needed technology and adapt to future needs. The need for secure systems to protect customer payment information and adequate bandwidth to support mobile point of sale solutions are understood. So, what are tomorrow’s needs and how can retailers to ready to meet them?
In the blog post, Adapting store experiences for post COVID-19 realities, Colpitts explains how increased digitization of the store and supporting facilities is needed to meet today’s customer expectations.
Consumers expect that a wanted item can be quickly found and sent to them. These individuals expect prompt service and choices of payment methods, including being able to pay using phones.
Consumers will expect that whatever new technology is developed next will be supported by their favorite retailers. The agility we have been talking about is essential to meeting tomorrow’s customer expectations, even though we do not yet know what they will be.
We do know that habits are changing rapidly. Colpitts and his Omnichannel team have heard things like, “I’m never putting another bag of dog food in my trunk ever again.”
Every retailer they talk with agrees that curbside pickup and delivery have vastly improved in-store inventory accuracy and contactless payments, as detailed in the blog post, From cash to contactless: accelerating payment technology to meet consumer demand. As a retailer, not knowing your in-store inventory is now considered inexcusable.
How do current expectations impact the mix of retail, warehouse, and shipping space? How can retailers be ready for what might come next?
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