When the law of supply and demand tilts in retailers’ favors, they can usually charge higher prices for goods that some shoppers don’t want to wait for. When that dynamic slips in the other direction, though, it may leave some merchants unable to deliver in hot water with shoppers.
According to a recent study conducted by JDA Software Group, as reported by The Wall Street Journal, that’s where many U.S. retailers might find themselves if they can’t figure out how to optimize supply chains to keep pace with shoppers’ increasing appetite for eCommerce orders. Through a survey of more than 1,000 online shoppers, JDA found that 35 percent of consumers ordered an item online and picked it up in a brick-and-mortar store over the past year.
However, of that 35 percent, nearly half reported problems picking up their purchases due to retailer-facing issues. Wayne Usie, senior vice president of retail at JDA, told The WSJ that, while picking and packing products is a normal process in warehouse-style locations, retail storefronts that also cater to in-store shoppers’ requests are getting slammed by the extra work.
“In the store, you’re asking store labor to do more services for the customers than they had to do before,” Usie said. “… They’re struggling with managing the task and additional work that’s required without making a difference in their labor expense, and that’s affecting customer service. It’s indicative of a lot of the challenges these retailers are facing.”
These challenges, along with already thin eCommerce operating margins, means that only 16 percent of online retailers are consistently turning profits, according to JDA.
Despite these troubling figures, retailers may have no choice but to follow customer demand for streamlining eCommerce buying behaviors. Major companies have thrown massive amounts of resources at optimizing click-and-collect programs, but if the JDA study points to anything, it’s that the work is far from done.
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