Making online local
Today’s consumers demand speed. While two-day deliveries were once a luxury, they’re quickly becoming the standard as retail giants continue to invest heavily in satisfying consumer expectations.
The challenges are many. But forward-thinking retailers are adapting rapidly and redesigning their supply chains in order to ensure they can deliver quickly by having the right inventory, at the right place, at the right time.
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To adapt to the challenge of on-demand shopping, retailers need to focus on:
Rethinking Fulfillment
Local, low-cost delivery
Local, efficient, high-throughput fulfillment
Category streaming (accuracy in selection, quantity and distribution)
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In order to satisfy today’s e-commerce customers while securing their business’s future, retailers are learning to creatively reimagine fulfillment.
But...
More than
Partnering with players like Amazon dilutes a retailer’s brand and margins.
Building an on-demand infrastructure from the ground up will prove too costly.
Partnering with legacy supply chain operators ensures the retailer will remain behind.
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90% of today’s consumers
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see 2- to 3-day delivery as the baseline, and
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Data science advances allow:
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Using advances in data science and intelligent operating networks, businesses can satisfy the demands of e-commerce consumers while improving their own margins.
Confluence of Tech Advances
Advances in microfulfillment
(AI and robotics) allow:
More accurate demand forecasting
Better inventory management
Optimized customer engagement
Automation for operational efficiencies
Smaller storage footprints
Reduced labor costs
Expected surge in Microfulfillment market:
~60%
(CAGR) between 2020 and 2026
Highest market share from the U.S.
Microfulfillment centers are purpose-built to make local, on-demand delivery viable for retailers. They easily surpass traditional storage solutions in:
The Strengths of an MFC
MFCs also take full advantage of the latest affordable advances in inventory intelligence to optimize both inventory visibility and demand prediction.
Fulfillment Speed
Far greater
throughput
per sq. ft.
Value
Lower fixed
and variable
costs
Scalability
Fully adaptable to retailer’s needs from day one
Location
Targeted site placement near dense populations
Delivery Time
Same-day delivery is doable and
cost-effective
In Grocery, building an MFC vs. a new store:
~60%
Grocery store=
cost of goods sold/yr
<30%
MFC=
cost of goods sold/yr
3X
MFC provides up to
better inventory turnaround
Speed in retail refers to much more than delivery time. Speed is paramount throughout the inventory cycle:
Speed Defined
When localized networks combine with large centralized MFCs — all automated and working on intelligent AI — then efficient delivery speeds can be guaranteed.
Same-day delivery costs plummet.
Discovery
Buying
Receiving
Storage
Fulfillment
Distribution
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Fabric works with retailers to provide a physical cloud of customized microfulfillment centers, all seamlessly integrated with upstream and downstream operations, strategically placed near densely populated areas — to make personalized same-day delivery an affordable reality.
Bringing It All Together
The automated MFCs feature:
> High-density modular topology
> Multipurpose robotics driven by smart AI
> A distributed system to avoid single point of failure
Operating expenses are minimized:
> Lower last-mile costs
> Higher fulfillment efficiencies
> Lower inventory costs
Revenue capture is maximized:
> Superior customer experience
> Wider assortment
> Lower prices
More than ever, retailers need to operate at speed.
Explore Your Microfulfillment Options
Visit getfabric.com to discover more about optimizing your microfulfillment capabilities to meet the current and future demands of e-commerce.
30% expect same-day delivery.