Going to the store may be your smartest bet to navigate the supply chain crisis this holiday

Today I was happy to share my thoughts on retailing, supply chain, and Holiday Shopping (in-store vs. online) with Nathaniel Meyersohn and Neil Saunders on CNN..

First, when style, color, brand assortments are limited due to inventory availability consumers face greater frustration online than they experience in-store. 

In-store a consumer can simply view, touch, try on whatever assortment is available during their visit. Online shopping tends to be more surgical and more difficult to browse for precise colors and fits. 

Next, as we and our brand and retail partners have learned over the past few years, the marginal net profit contribution is greater for an in-store sale than for an online sale, for the same item sold at the same price. 

Although brick-and-mortar sales require high “four wall” costs (real estate, personnel, utilities, etc.) online sales require substantial costs of “pick and packing” of inventory, boxing, handling, outbound freight to consumers, and large reverse logistics costs due to high return rates (returned freight from consumers, inspection, repacking or refurbishing, etc.). We’ve paid the tuition for this education, and it was an expensive lesson to learn.

Finally, when consumers shop in stores the average basket size is greater. When consumers walk through a store, they make “impulse” purchases (“oh, look at that…”) and “radiant” purchases (related items displayed adjacent to key items, for instance, belts presented near pants).

Therefore, when inventory is limited, we prefer to drive consumers to in-store purchases over online purchases. 

At Randa Apparel & Accessories, our in-store marketing includes increased visual merchandising via our dedicated sellers and in-store merchants, store signage and point-of-sale fixtures, print advertising, co-op ads with our retail partners, and even social media encouraging consumers to “buy now” at a store near them.

Happy and safe Thanksgiving holiday to all.

At Walmart, Deliveries are Going Driverless

Through months of testing in Bentonville, Walmart has determined that self-driving autonomous box trucks offer an “efficient, safe and sustainable solution” for transporting goods.

The retail giant has begun using driverless trucks in Bentonville, Ark., to move groceries ordered online by shoppers from a Walmart “dark store,” which is a store that stocks items for fulfillment but isn’t open to the public, to one of the company’s Neighborhood Market stores for customer pickups. 

The truck operates without a safety driver behind the wheel.

Walmart is also testing the technology in a handful of markets in Texas and Louisiana, though in those cases, there is a safety driver on board as a back up.

Walmart’s driverless trucks are supplied by Gatik, a relatively new company for automated, self-driving trucks handling short-haul, middle-mile logistics. 

The theory behind utilizing the autonomous trucks is that they will help meet the increasing demand to fulfill online orders, keep delivery times short, and will compensate for driver shortages. 

Gatik also contends that eliminating the human factor reduces the chances for incidents on the roads. “Through our work with Gatik, we’ve identified that autonomous box trucks offer an efficient, safe and sustainable solution for transporting goods on repeatable routes between our stores,” said Tom Ward, senior vice president of last mile at Walmart U.S.

Ward characterized using driverless delivery trucks as an “industry milestone,” marking the first time that an autonomous trucking company has removed the safety driver from a commercial delivery route on the middle mile anywhere in the world.

Walmart, said Ward, “looks forward to continuing to use this technology to serve Walmart customers with speed.”

Since July 2019, Walmart has been testing Gatik’s driverless truck with a safety driver in the vehicle. Last August, the safety driver was removed from the vehicle. The driverless trucks have been making repeated delivery runs per day, seven days a week on public roads.

“Arkansas and Gatik have shifted into the future with Gatik’s self-driving delivery truck,” Arkansas Gov. Asa Hutchinson said in a statement. “It is fitting that Arkansas, which is home to the greatest retail companies in the world, is the launching pad for this innovation in retail delivery.”

  • David Main, WWD