U.S. retailers are just beginning to experiment with in-store pickup, which means they can learn from their U.K. counterparts who have offered the service for many years. A few consumer pain points to keep in mind: arriving to pick up an item just to be told it is out of stock, long waits at understaff locations, and lack of dedicated areas for in-store pickup to help those customers avoid the crowds. Though it is a more mature market, U.K. brands are still experimenting with the concept. For example, Argos – which fulfills 63% of its digital orders via click-and-collect, is testing new inventory models. It has installed a “hub and spoke” distribution network which recasts the retailer’s 150 large-format stores as shoppable warehouses (hubs) that serve four to six smaller-format stores (spokes) each.
As U.K. retailers are also discovering, offering in-store pickup on a large scale can be costly. John Lewis – which has offered click-and-collect since 2008 – fulfills 54% of its online orders through the service. In July, however, the company announced it would start to charge a small fee (£2) for orders under £30. The service fee offsets the cost of logistics, while being cheaper than shipping.
For more on how retailers can manager fulfillment costs, download a copy of L2’s Insight Report on Omnichannel Shipping & Fulfillment.