6 trends impacting retail logistics

Fergal Glynn Last Updated: July 2nd, 2019

Retail and e-commerce companies are in a race to adjust to the ever-changing needs of their consumers, influenced by a number of technology trends and cultural shifts. The biggest impact of these trends can be seen in retail logistics, where factors like rapid delivery and increasing mobile adoption are driving change.

Today, we’re going to look at six trends that have had the biggest impact on retail logistics and will continue to transform the industry in the coming years, including:

  1. An earlier (and longer) holiday shopping season
  2. Continued growth in mobile commerce
  3. Consumer demand for omnichannel retail experiences
  4. Big data/embedded integration technology
  5. Increased adoption of collaborative robots
  6. Growing demand for rapid home delivery

Let’s take a look at the reasons these trends are having a significant impact on retail logistics.

1. An earlier (and longer) holiday shopping season

According to eMarketer, shoppers are visiting both brick-and-mortar and online retailers during the holiday season earlier than ever before. In fact, Statista reports that 35.5% of digital shoppers planned to start their holiday shopping before Thanksgiving in 2017.

For retailers, this means that the holiday shopping season is getting longer, beginning even before the traditional shopping kickoff, Black Friday. That means fulfillment centers, especially, must be prepared for increased demand for cycles that can span an entire quarter — perhaps longer, if you consider the returns period that extends through the month of January.

2. Continued growth in mobile commerce Growth in mobile commerce

Since the economy is currently strong — growing an estimated 2 to 2.5% in 2018 — many consumers are increasing spending. Given the widespread proliferation of smartphones, it’s no surprise that there’s been a noticeable shift to mobile commerce.

That doesn’t mean that traditional, brick-and-mortar retail is dead, however. The most innovative brands are enhancing their customer experience by adopting mobile elements that drive foot traffic into stores. One example of this is online services that allow customers to reserve items for in-store pickup.

3. Consumer demand for omnichannel retail experiences

Savvy consumers are beginning to expect omnichannel retail experiences from their favorite brands, meaning a seamless and consistent experience across channels including online, mobile and in-person. If a customer purchases an item online, for instance, the omnichannel model means the customer can return the item to any brick-and-mortar location, regardless of where it was purchased.

For retailers that keep online inventory separate from brick-and-mortar inventory, this can quickly complicate logistics — particularly if those distribution centers are located on opposite ends of the country.

4. Big data/embedded integration technology 

Embedded integration technology is another major trend impacting retail logistics, as logistics companies recognize the need to seamlessly and reliably share data back and forth with customers. For example, real-time location tracking coupled with real-time traffic updates make it possible to optimize delivery windows. Embedded data platforms make it possible to connect and integrate data leveraging capabilities that are already built-in to the solution.

Another example is RFID technology. When integrated with other systems, such as inventory management software, can provide real-time location and quantity data, resulting in fewer backorders and more accurate estimates of delivery times and shipping costs.

Embracing these trends allows retailers to better share data throughout their supply chains, connect with customers in more meaningful ways and more effectively track inventory. Utilizing software that aggregates the data, on-demand, helps retailers and logistics companies make big decisions in a flash and can save time during audits and reorganization.

5. Increased adoption of collaborative robots

This goes for all warehouses, but particularly retail fulfillment and distribution centers that are always striving to improve picking times.  Collaborative robots, like 6 River Systems’ Chuck, help to improve productivity and efficiency by streamlining picking routes and improving pick rates.

Collaborative robots are particularly appealing to retail distribution and fulfillment as the retail industry experiences significant seasonal peak periods (e.g., the aforementioned holiday shopping season). Because collaborative robots don’t require new infrastructure, warehouse operators can rent additional robots to accommodate seasonal demands and return them after the peak period. With Chuck, the average associate onboarding time is just 15 minutes, so it’s also a practical solution when you’re working with seasonal or temporary employees. 

6. Growing demand for rapid home delivery

Amazon is often considered the driver of the rapid home delivery trend, thanks to its guaranteed two-day delivery through Amazon Prime. Given that 96% of Americans have shopped online, it’s a trend that’s not likely to fade into the background anytime soon.

Although brick-and-mortar stores are still prominent, there’s no denying that retailers must be ready and able to meet the demand for rapid delivery. To do so, many companies are turning to the technologies mentioned above, such as collaborative mobile robots to improve picking times and speed fulfillment, as well as embedded integration technology and big data to optimize delivery routes, all with the goal of delivering goods straight to consumers’ doors faster than ever before.

These and other trends are the driving force of change in retail logistics. Ultimately, innovation arising from these trends will benefit not only the consumer, but also retailers and logistics companies by improving processes, boosting performance and giving companies a competitive edge.