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The Pickup Imperative: BOPIS is no longer a “nice to have”

Every week I see articles come out about the “end of retail” or “retail apocalypse”, but with so many articles focusing on the importance of the customer in-store experience, we still continue to see retailers lack key capabilities around pickup in-store functionality.

Make no mistake, these projects are a substantial undertaking, however when you look at a BOPIS project sheerly on the numbers, the ROI can typically be realized within the first year if done correctly. A 6-9 month implementation can range in cost of from 4-10 million USD, but with an industry benchmark of 15% increase in sales, a company doing 200 million on a website a year can see an additional 2 million in the first year of add-on purchases while in the store.

Given the above, what’s interesting is that, of all the omnichannel capabilities retailers seek to have, BOPIS never seems to be the first lead-in project. This blog will help you understand the importance of BOPIS as a “must have”, some key considerations before starting implementation, and highlight some best practices once your project is in full swing.

Making the case for BOPIS

Discussions for BOPIS projects typically start at either VP of E-Commerce or at CFO level. Before arriving at a realistic ROI, it’s important to first assess the current state of inventory accuracy, and operational capabilities to execute the fulfillment itself. Things to look for are a high level of inventory accuracy and ability within the current workforce at the stores to given part of their time to BOPIS and still meet an acceptable service level agreement. The need for additional inventory in the stores or having an already highly utilized store employee is not sustainable and reduces the time to ROI realization of additions in either of these two areas are necessary. Once studied and factored in, most retailers see anywhere from low teens up to 25% additional incremental increase in sales.

Once the numbers are solidified, the best approach is to have a discussion with CFO and COO as to timelines, cost, and risk. What works best is to create a project charter which can communicate this at a summary level. With buy-in from the executive level, the project is ready to start!

What they tell us they wish they knew earlier…

Just recently I joined a project for a leading home goods retailer. As it happens often, we were pulled in after the project already started to come in, help get organized and detailed in the requirements phases. We see this happen often when the case is made to leadership and everyone aligns to start, that most companies dive right in, instead of taking at least a couple of weeks to get some level of requirements detailed out. SCA’s recommendation to our clients is that, prior to initiating the project with internal IT or outside software providers, that a team is first established with key stakeholders across all major departments involved.

Creating this team and getting synergy started will help gain momentum in the onset of the project, rather than software providers coming on-site to tell what the systems do, and the business needing to bend to a pre-packaged software solution. Rather, this approach allows our customers to go to the software providers and explain the desired solution, and with a clearer understanding of capabilities, a better estimate at cost and timelines can be calculated, ultimately feeding back into the above-mentioned ROI calculation. This approach is critical because it mitigates the risk of paying for new software license and services that come with it, only to find the solution really doesn’t meet the organization’s needs.

All’s well that starts well

As in anything in life, we learn from our lessons, and when those lessons are painful, they stick with us! What’s important with BOPIS projects and in general with any Omnichannel transformation project is to allow ‘lag’ within the project plan and create breathing room to make mistakes and quickly learn from them. Implementations that we’ve seen start with a hard deadline and “do not exceed” budget rarely work. The end result is typically something that does not meet the organization’s needs and specifically doesn’t cater to the customer’s needs.

Also, it goes without saying, but invest in a solid business analyst role. Someone familiar with leading tools like JIRA/Confluence and a perpetually intuitive mindset to come in, define requirements and help organize the implementation. If this person doesn’t exist within your organization, then find an external expert that can fill this role.

If it was easy, everyone would be doing it

Given the above points, you can see there’s a lot to consider when making the BOPIS case, and even more when it comes to execution. The better a retailer does their homework up-front, the easier the execution becomes and the risk is limited to truly unknown issues. Just as in other industries, it helps to both have an expert and an outside opinion on how to proceed, and that outside help needs to be positioned up to executive level to make them truly effective in the discussions. ROI is key here, and speed to market is essential as the trend continues to grow. Limiting cost and quickly realizing the value of BOPIS can be done, but has to be approached correctly.