A dark shop, also called a dark supermarket or a dotcom center is a physical retail distribution space or warehouse that exclusively caters to online order fulfillment. Unlike traditional stores that intend to attract walk-in consumers, dark shops are closed to the public and only address customers’ online orders generated from websites, mobile apps, third-party aggregators, or other online channels. They serve as distribution hubs for product inventory, package, picking, shipping, and everything dedicated explicitly to online order fulfillment.

In a simple explanation, the dark store model operates like a warehouse concept, featuring layouts optimized for picking, packing, and delivering. 

When a customer places items online, the order will proceed to dark store staff, and the fulfillment will occur in the dark shop. Based on the incoming requirements, the store pickers, available around the clock in the dark shop, will pick and pack the curated items. The order will then be directly delivered to the customer’s address. Customers can also select and buy things online and arrive in-store for pickup.

The first-ever dark shop was launched in 2009 by Tesco, a supermarket chain in the U.K. This innovative retail model quickly spread worldwide as it required low costs to set up and fulfill online orders to leverage the power of online purchase. 

The surge in online shopping during the COVID-19 pandemic has fueled the significant presence of the model, encouraging more retailers of all sizes to jump onto the bandwagon. Dark grocery stores and dark clothing stores are some examples of dark store models.

The key reason why the dark supermarkets stay popular today is the rapid growth of eCommerce. By 2027, 23% of total retail sales will happen online. The rise of online shopping is significantly shaping customer shopping habits with the preference for ease, flexibility, and prompt delivery. As a result, building a dark shop is necessary for retailers to better prepare for the future.

One more reason for the model’s popularity is that establishing a dark shop is not a headache for retailers and saves them effort and costs compared to building a fulfillment center. Retailers can easily repurpose existing retail space or physical stores with low foot traffic to create new dark shops for fulfillment.

Dark store delivery helps enhance customer experience. 

41% of consumers expect their online orders to be delivered within 24 hours. Dark stores can accelerate the delivery speed because:

• They are equipped with automation technologies for order handling. Therefore, it takes only minutes to prepare items and hand them over to shippers.
• They are located near the end customers. Thus, you can deliver items to your customers on the same day.
• They are set aside for fulfilling online orders which allow customers to choose their preferred pickup time to avoid waiting lines and speed up the checkout process.

In today’s competitive eCommerce landscape, fast delivery is crucial for your success. 

Reduce costs 

Retailers can minimize operating costs since they don’t have to pay for aesthetic elements, inventory display and fixtures, in-store marketing, and other expenses related to operating physical shops. There’s no need to invest in an appealing or large-spacing storefront to attract customers. Moreover, running dark stores can save you 23% on delivery costs.

Improve inventory management 

Dark retail stores apply sophisticated inventory management systems that ensure fast speed and accuracy in real-time tracking, sorting, and picking processes. Thus, they enhance inventory management efficiency and reduce errors throughout the order fulfillment process. 

Flexibility and scalability 

Concepts like dark stores equip retailers with the agility and flexibility to quickly adapt to customer demands, market trends, and seasonal fluctuations. Without the constraints of physical stores, retailers can update more products, offering more options while managing their inventory easily. 

Along with numerous benefits, there are some challenges to take into account when establishing a dark store strategy and operating it successfully. 

Initial setup costs 

Setting up a dark shop requires significant initial investment in some aspects, including infrastructure, facilities, advanced technology, and staff training. Retailers should carefully elaborate on the cost-benefit analysis when creating a dark store strategy to ensure a return on investment. 

Operational complexity 

A dark shop “wears many hats” to address a vast number of online orders meticulously, from inventory management to order fulfillment and shipping. A dark store can’t handle these multitasks with simple infrastructure that lacks digitization and automation.

Workforce management 

Besides technology solutions, skillful employees are the backbone of a dark shop. However, it’s challenging to train and manage a workforce that’s capable of handling various tasks, including picking, packing, tracking, shipping, etc. This poses challenges on how to ensure their productivity and satisfaction to adapt to such a huge order volume.  

Dark store fulfillment, from when an order is placed online until it’s ready to deliver, may occur in minutes, following a smooth and automatic dark store management process.

• Order receiving: Once an order is placed through a website, app, or online platform, it’s recorded in the centralized management system and then electronically assigned to the staff. 
• Order picking: The pickers will collect the items based on the order details. Unlike traditional stores, where pickers have to collect items around the aisles with trolleys, the dark store has pickup areas designed for optimal picking. Items are segregated by order and have barcodes for the pickers to scan. The pickers, equipped with handheld devices or wearable technology, will gather the items from the picking areas for packing.
• Order packing: Once the items are gathered, they’re packed and sellotaped in suitable packing materials to ensure a secure and presentable package, especially for delicate or fragile goods. Each package is labeled with the order details, including the receiver’s address, phone number, or any relevant information, and ready for dispatch.
• Delivery or pickup: The packed orders are then dispatched for shipping through the in-house delivery team or logistics partners. The standard delivery channels include courier companies, postal services, and fleets. 

Store-to-door delivery is the most common method customers prefer as it’s fast, convenient, and contactless. The order is directly shipped to customers’ doorsteps. 

Customers also have the option to pick up items themselves at the dedicated pickup points, usually near or inside the store. Another service is curbside pickup. This way, pickers will bring out the ordered items for customers waiting at dedicated parking areas. 

Here, we break down several key factors that significantly contribute to the success of dark store management. They help retailers operate every stage smoothly and productively while meeting customer demands and generating benefits. 

Leverage advanced technology and automation 

Almost all stages of the dotcom center operation require technology application to streamline processes and enhance efficiency. Take order management, for example. This system should integrate with software or advanced platforms that facilitate efficient real-time tracking, picking, packing, and delivery. This way, the retailers can ensure order fulfillment and timely delivery to their customers. 

The more dark stores become automotive, the more operations are productive with fewer human errors. Some cutting-edge technologies for dark shops include automated sorting systems, robotics for picking up, conveyor systems, etc.

Invest in inventory management

The inventory management system plays a core role in the operation of dark retail stores. It’s crucial to apply advanced inventory solutions to ensure real-time monitoring and accurate stock tracking. Consider using barcode scanning, RFID tags, inventory databases, real-time updates, analytics and reporting systems, etc. These technology-driven solutions reduce human errors and the risk of out-of-stock situations, thus improving accuracy for better business decision-making.

Develop effective marketing to drive online sales

Dark stores are exclusively used for handling online purchases. To make use of them, apparently, you’ll need onlines orders. And to boost online sales, you should ensure that your brand, products, and services can reach more potential customers.

You can invest in marketing campaigns to increase customer awareness, drive traffic to your online channels to convert sales. Some effective marketing channels include emails, websites, social media platforms, marketplaces, or you can go omnichannel to sell on multiple platforms while centralizing and syncing all sales data in one place for better control.

In addition, you should strategically offer special discounts, upselling, cross-selling, or other marketing techniques to trigger customer needs. 

Hire and train staff

Staff members ensure smooth operations in collaboration with machines and technology. Retailers should invest heavily in training staff specialized for each stage to promote accuracy and productivity. 

Also, building a solid working culture can inspire and motivate them at work.

The dark store is not a one-size-fits-all solution since each business needs specific strategies tailored to their range of products, target customers, and markets.

It should be noted that this model is beneficial for retailers who heavily invest in eCommerce and online order fulfillment.  

For small-sized businesses that have a limited online presence and lower online order volume, the dark shop might not be a good fit as setting up it might overcast their budget and, therefore, make it difficult to generate benefits in return. 

Though offering numerous benefits, dark shops might not fit some retailers well. We recommend some alternative options that can be considered in terms of business needs and circumstances.

• Micro-fulfillment centers: Micro-fulfillment centers are used explicitly by eCommerce businesses to handle online orders. They are small-sized, highly automated, and located near existing stores to reduce logistics costs. There are only some slight differences between dark stores and micro-fulfillment centers. Dark shops are often used by larger retailers and can consume more space than a micro fulfillment center. Micro-fulfillment centers, on the other hand, are smaller, more compact facilities designed to tackle a smaller volume of products or categories. The latter is also preferred by retailers operating in areas whose property costs are high and focusing on same-day deliveries.
• Third-party logistics providers: Partnering with 3PL providers is an approach for retailers needing more means to create and operate a dark shop themselves. These providers offer solutions covering setting up infrastructure, order fulfillment, storage, delivery, etc., that take care of overall shady shop operations on behalf of retailers and enable them to focus on their core competencies.
• Store-to-door delivery: Store-to-door service allows customers to shop in-store, then the purchased products will be delivered directly from the stores to their addresses, typically their home or office.

The dark store model is expected to continue scaling and evolving to meet customer demands. The global market size is forecasted to grow by 38% from 2023 to 2033. 

As technology is the backbone of dark shops, key trends that shape the future of this retail model include the leverage of technology to enhance operations. The years ahead are likely to witness technological advancements deployed in inventory management, order tracking, shipping, and other stages of retail fulfillment. Automation, robotics, and AI-powered chatbots are among them.

As sustainable development and green energy are a necessity, delivery solutions will be more eco-friendly, such as using bikes and electrical vehicles for delivery.

If you’re looking for a killer, technology-driven solution to leverage dark store management and operations to stay ahead of the retailing game, Magestore comes in with all-in-one weapons to level up your business to new heights, especially with order management. 

Smart inventory management

Once you integrate the Magestore shop management software in dark stores, you’ll be empowered with the best inventory management to track real-time inventory levels and monitor all inventory movement. 

The powerful inventory tool will give you a comprehensive look at in-stock, incoming, threshold, etc., to avoid stockouts and make informed decisions. The Magestore barcode management helps you quickly scan items and track stock status accurately without sweats.

Comprehensive reports 

By syncing and centralizing data across channels in real time, Magestore retail POS can generate reports covering orders, sales, and inventory. This gives you profound insights and live view into your business performance for accurate forecasts and business strategies. 

Staff performance

Magestore solutions can track daily, monthly, and yearly sales, thus reflecting on staff productivity. The system enables to set different permission levels for managers and staff, thereby streamlining operations. 

Flexible shipping methods

You can use in-built shipping methods such as DHL, FedEx, UPS, USPS on Magestore POS and retail software or integrate the POS with other shipping carriers to facilitate delivery. 

You can also incorporate the BOPIS model (buy online, pick up in-store) into your dark supermarket or provide curbside pickup on Magestore POS. 

Magestore solutions can be effortlessly installed in your dark stores. To save you time and effort on research, please contact Magestore experts. Our specialists will offer a 1-on-1 consultation and guide you step-by-step to seamlessly set up the system in your stores.

Why is it called a dark store?

The term “dark store” refers to a “ghost” store which is not open to the public. A dark store is not used to attract walk-in customers but solely to fulfill online orders. The dark store’s functions involve storing, picking, packing, and delivering.  

What do dark stores in logistics mean?

As a part of the supply chain network, dark shops in logistics refer to handling online orders to optimize the workflow and facilitate deliveries. 

What is the benefit of dark stores for a traditional store?

Dark stores can help speed up the checkout process at traditional stores in several ways.

• As built exclusively for fulfilling online orders, you can separate the online orders by shipping duration for better fulfillment. For example, orders with same-day delivery will be picked up at the dark stores, while orders with 2-day delivery will be handled at traditional stores.
• As often located in urban areas to be nearer to customers, dark stores can stimulate more customers to buy online and pick up items in store. That can help you reduce the shipping costs.

What are the key differences between a dark store and a warehouse?

A dark store is designed solely for online order fulfillment, including inventory handling, picking, packing, and delivering. 

On the other hand, a warehouse wears more hats, including retail distribution or manufacturing. 

Micro-fulfillment is a fulfillment strategy that aims to utilize small and highly automated fulfillment centers at locations closer to the end customers to expedite order delivery and decrease shipping costs. It’s a retail strategy employed by retailers to manage inventory and streamline the order fulfillment process.

On top of optimizing order processing, micro-fulfillment also facilitates various delivery and fulfillment options like curbside pickup, click and collect, or home delivery. More and more eCommerce businesses leverage this strategy to offer their customers rapid, accurate, and diversified shopping experiences without substantial cost increases.

Many giant retailers use micro fulfillment as a critical strategy to expand their supply chain, reach more customers, and optimize the fulfillment process, thus boosting sales. Some well-known brands that have already deployed this strategy include Walmart, Kroger, and Jewel-Osco.

Micro warehousing refers to a warehouse management strategy that harnesses a system of small storage facilities rather than depending on one major distribution center to fulfill orders. Micro-warehousing means moving the inventory closer to the end consumers to cut costs and delivery times. It’s a core component and basis for any kind of micro-fulfillment strategy.

Retailers often place micro-warehouses in or near the densely populated areas where the majority of their customers reside. In other words, business owners use micro-warehousing to stock inventory near the customers who are likely to purchase it. Therefore, this strategy helps improve last-mile fulfillment while meeting local demands.

A micro fulfillment center is a small-scale storage and fulfillment facility that stores inventory close to consumers to accelerate order fulfillment speed. To help increase operational efficiency, these centers are often equipped with automated software and other micro fulfillment technologies.

Micro-fulfillment centers are often smaller than traditional warehouses and are used to store stocks for a short time before delivering the products to customers. Contrary to the main warehouses located on the outskirts of cities, micro-fulfillment centers are often positioned in urban areas where most consumers concentrate. Thanks to that, retailers can offer more fulfillment options to their customers, including curbside pickup or buying online, picking up in store.

Businesses can establish standalone micro-fulfillment centers or build them into their existing brick-and-mortar stores to serve a specific geographical radius. MFCs can also be set up at the back of a supermarket, garage, basement, or any other convenient space provided by a 3rd-party.

Below is the working process of a micro fulfillment center.

• Receive and store inventory: MFCs receive products from main warehouses or suppliers, and then check to see whether there are any faulty, wrong, or missing products. The products are then stored appropriately and tracked with SKU numbers.
• Pick and pack: After receiving orders from customers, MFCs pick products, then pack and label them to prepare for shipping. In this step, the centers should pick orders as fast and accurately as possible, and use proper packaging materials to avoid damage.
• Ship orders: The order delivery is arranged and assigned to shipping carriers to transport to customers.
• Handle returns and exchanges: MFCs examine the returned items and record all the damages, then handle returns and exchanges based on retailers’ return policy.

What distinguishes micro-fulfillment centers from large ones is mainly their sizes.

Micro fulfillment centers

Typical micro-fulfillment centers are from 3,000 – 10,000 square feet. They can store up to 15,000 different items. As MFCs are often placed within or close to a retail store for picking up, packing, and shipping orders rapidly, they normally can only store about 24–48 hours’ worth of inventory.
For instance, Walmart has built a 9,000-square-foot micro-fulfillment center equipped with Alphabot automation technology within a Walmart Supercenter in New Hampshire and put it into operation in 2020.

Large fulfillment centers

On the other hand, large fulfillment centers can be from 30,000 square feet or more depending on business sizes. Large fulfillment centers require vast space to store massive amounts of inventory in the long term, so they are often located far away from urban areas, which causes the delivery times and costs to go up. Thus, if operating a large fulfillment center, you should pay attention to the proper warehouse design and fulfillment software to route the optimal picking path.
For example, Amazon’s fulfillment center in Tennessee is about 3.6 million square feet and Nike’s is 2.8 million square feet.

eCommerce business owners can reap enormous benefits from incorporating micro-fulfillment into their retail strategy. Let’s take a look at some key advantages below.

Accelerate order fulfillment

Most micro fulfillment centers use automated software and AI technologies to speed up order processing. For example, some software automatically generates a picking list for faster fulfillment. With the support of these modern micro-fulfillment systems, retailers can receive and fulfill orders rapidly with fewer human errors and more fulfillment efficiency, thus reducing the number of wrong orders and returns. The small-scale warehouses also ease the process of picking, packing, and shipping items, thereby making last-mile delivery cheaper and quicker.

Improve customer experience

Storing and fulfilling orders from locations near the end consumers enables sellers to quicken order delivery and process exchanges and refunds faster, thus meeting customers’ expectations and improving their loyalty. Besides, micro-fulfillment allows retailers to provide a wider range of fulfillment options for customers, including click and collect and local pickups, which also helps enhance customer service and customer retention.

Reduce costs

The utilization of automation in many micro fulfillment centers reduces the amount of manual labor in need, thus saving on labor costs. For example, automation technologies can decrease order fulfillment costs from $10 – $15 to $3 – $6 per order as compared to manual fulfillment. Besides, shipping orders from closer locations to customers also lower transportation costs. With micro-fulfillment, retailers can minimize order errors, thus lessening additional costs to fix mistakes or refund customers.

Enhance inventory management

Micro-fulfillment facilitates effective inventory management. Retailers need to apply advanced micro fulfillment technology to get accurate inventory visibility in real time across locations. With that live view, merchants can effectively route the order fulfillment process and make the right decisions on reordering to avoid stockouts or overstocking.

Observing order history and patterns allows retailers to forecast demands for products at the local level. On that basis, sellers can optimize inventory allocation by storing the products in high demand for each local market.

Flexible to scale

Building and operating large fulfillment centers or warehouses often costs a bundle and consumes much time. In contrast, establishing and adding micro-fulfillment centers to your current supply chain is more affordable and faster. Therefore, retailers can handle high-volume fulfillment quickly where customer demand rises. What’s more, businesses can also easily scale their operations without immense investments as there’s no need to hire large space for fulfillment.

Clearly, great challenges often accompany huge advantages. To effectively execute micro-fulfillment strategies, retailers should be aware of the following challenges to consider carefully before deployment.

1. Unpredictable customer demand

Consumer demands don’t stay steady all the time. In contrast, the demands keep changing continuously and can be affected by lots of unprecedented factors like natural phenomena. Besides, the limited storage capacity of micro fulfillment centers makes it hard for retailers to adjust to abrupt demand changes caused by any other social or economic trends.

For example, a storm or tornado can cause a surge in demand for specific types of products and disrupt fulfillment operations in certain areas, thus leading to inventory imbalance of some MFCs.

2. Frequent stock replenishment

Due to small space for storage, a micro fulfillment center can only hold a certain amount of stock in the short term. Therefore, these centers need to be replenished constantly. To avoid stockouts, retailers have to accurately manage their inventory in real time to make timely replenishment decisions.

In addition, how much inventory to place in each center is also challenging. Sellers should consider carefully to balance the inventory among these facilities so there are enough stocks to meet the demands of each location.

3. Ineffective micro-fulfillment systems

Using ineffective systems to operate and manage order fulfillment might cause great damage. An outdated system that can’t integrate with other retail systems such as ERP or POS makes you lose track of the inventory levels and any order changes. Not grasping inventory and order updates might result in inaccurate deliveries, underselling, or overselling, which may discourage customers from more repeat purchases.

As a result, finding a suitable system that integrates seamlessly with other software and apps helps you deal with complex fulfillment operations. A good micro fulfillment solution can inform you of the stock replenishments and generate demand forecasts to decide which products to stock in specific locations.

4. Unsuitable for all product types

The limited storage space of micro-fulfillment centers also restricts the type of products they can store. Intended for short-term inventory storage, these centers are not an appropriate place to hold large or bulky items that might occupy a large area. Besides, these products are not purchased frequently and are difficult to stock. Micro-fulfillment centers are more suitable for seasonal or perishable products like groceries or clothes.

Consequently, retailers must consider which types of products they should store and fulfill in micro-fulfillment centers.

Micro-fulfillment is beneficial to both small, medium, and large businesses. Retailers can choose whether to outsource the fulfillment to a 3rd-party logistics company or fulfill orders in house. To help those who want to do self-fulfillment, Magestore provides a range of effective fulfillment solutions.

Capturing the needs of small and medium businesses, Magestore offers Magestore Order Fulfillment software to speed up order processing and fulfillment. The software lets users manage cross-channel orders and update inventory status in real time. Moreover, you can optimize the fulfillment process and manage the order fulfillment from a central place.

Magestore also enables retailers to manage inventory effectively for order fulfillment with the retail management PWA. The software supports syncing inventory between retail systems like POS or eCommerce websites, and marketplaces like Amazon, eBay, Etsy, tracking stock levels across locations, informing stock replenishments, and forecasting demands. Magestore’s solution gives you complete inventory control, thus contributing to accurate and fast order fulfillment.

You can also use Magestore POS at your physical stores to give your customers more fulfillment options with store pickup, buying in store, and shipping to home, or buying online and paying in-store.

If you’re confused about what choice to make, talk to our experts now to find out what best suits your business needs.

What companies are using micro fulfillment centers?

Some big brands in retail have deployed micro-fulfillment centers for faster order fulfillment, including Kroger, Gopuff, Walmart, Walgreens, and Safeway.

What is the difference between a micro fulfillment center and a dark store?

Micro-fulfillment centers are small spaces within existing stores or an independent space near the store to handle a high order volume quickly without impacting in-store operations. Meanwhile, dark stores are retail stores that are set apart to fulfill online orders.

How much does a micro-fulfillment center cost?

Retailers need to make an upfront investment to set up a micro-fulfillment center. The costs can vary depending on the scale, location, and site conditions of the center. However, after years of operations, the benefits retailers get can offset the initial expenses.

eCommerce fulfillment services refer to a type of service offered by a 3rd-party company to fulfill online orders on behalf of an eCommerce merchant. The top eCommerce fulfillment companies help online retailers manage the entire order processing and supply chain. It often encompasses managing inventory, picking and packing the items, shipping them to the end customers, and handling returns.

Fulfillment by Amazon, Shopify Fulfillment Network, ShipMonk are some of the popular service providers. And we’ll talk about them in detail in the following part.

An online business owner can choose whether to fulfill eCommerce orders in-house or hand over the fulfillment to a 3rd-party service provider. Each fulfillment strategy can yield distinct benefits that suit different business requirements.

Self-fulfillment utilizes in-house facilities, labor, and technology. It’s easy to implement and cost-saving as retailers process orders themselves. In-house eCommerce fulfillment gives sellers complete control over the fulfillment process, packages, branding, and customer services.

Forwarding fulfillment to a 3rd-party logistics company enables online retailers to harness their facilities, technology, and expertise to fulfill orders. These fulfillment services for eCommerce reduce operating costs, accelerate delivery speed, simplify retail operations, and scale up with the business growth.

Opting for an appropriate fulfillment solution requires the assessment of certain aspects of your business. Take into consideration the following factors to decide whether you should fulfill orders yourself using self-fulfillment software or cooperate with a fulfillment service provider.

Order volume

The number of orders plays a key role in choosing your go-to fulfillment solution. Startups or businesses with low order volumes can fulfill orders in-house to minimize additional costs.

However, when sales increase to the points that exceed your ability to handle orders internally, you can risk processing orders inaccurately and slowly. Therefore, businesses with rapidly growing sales or large order quantities might consider employing one of the best eCommerce fulfillment services for efficiency, accuracy, and cost-effectiveness.

Customer locations

Considering where the majority of your customers place orders is worthwhile. If your customer base is in areas far away from your business facilities, using 3rd-party fulfillment services will help reach your customers quickly without huge costs.

The network of eCommerce fulfillment centers and warehouses enables the service providers to transport products from the locations closest to the customers. In this way, you can shorten the delivery time while keeping the costs down, thus satisfying customers.

Product types

The type of support you require from an eCommerce fulfillment solution provider depends on what kind of product you sell. Some products need simple packaging while others may demand more special handling techniques and storage. Besides, the product characteristics also affect shipping costs.

For example, if you’re selling heavy and bulky items, switching to a fulfillment service may be beneficial. The fulfillment company can help you handle the item properly with secure packaging materials and lower shipping costs as they can get discounts for bulk shipping.

Sales channels

Selling on many channels like eCommerce platforms, websites, or social media has become a norm to attract more customers and boost sales. If this is your case, you should consider choosing a fulfillment service provider to help you fulfill your omnichannel orders.

Oftentimes, these eCommerce order fulfillment services can assist you in meeting different expectations and requirements about delivery speed, cost, and more to satisfy customers. Otherwise, if your revenue comes from one channel only, it’ll be enough to fulfill orders yourself with the support from suitable software.

If you choose in-house fulfillment after reviewing your business context, you’ll need workable software to automate and simplify the process. We’ve singled out the best solutions for self-fulfillment by consulting our experts, looking into the key features, and customer reviews about each solution.

1. Magestore Order Fulfillment: Best for Magento small and medium omnichannel merchants

As one of the best eCommerce fulfillment solutions for Magento (now Adobe Commerce), the Magestore Order Fulfillment module facilitates cross-channel order management and efficient order processing. The software allows sellers to deliver fulfillment requests to different warehouses when there’s a sale and recommends the best warehouses to fulfill the orders. With Magestore Order Management, you can also supervise the full order fulfillment process from a single place.

Magestore’s eCommerce order fulfillment software speeds up your fulfillment work with 2-step barcode scanning which ensures you pick the correct items quickly. Besides, you can assign different tasks of the fulfillment process to different employees to reduce processing time and increase accuracy.

Highlight features

• Automate order processing with 5 steps: Verify, Fulfill, Pick, Pack, and Deliver
• Manage orders across online and offline channels and update inventory status in real time
• Manage order fulfillment from a centralized system
• Provide a quick view of sales orders with 6 types of visual charts: Orders by status, Orders by day, Orders by carriers, Verified orders by day, Picked request by day, and Packed request by day
• Check inventory from different warehouses to route order fulfillment efficiently
• Support 2-step barcode scanning to ensure order accuracy and speed
• Assist order fulfillment from multiple warehouses
• Manage and locate orders by batch, status, and customized tags
• Optimize the fulfillment process with 4 insightful reports, including Fulfillment by staff, Fulfillment by staff (Daily), Fulfillment by warehouse, Fulfillment by warehouse (Daily)
• Allow assigning each order processing step to each staff for easier tracking staff performance
• Handle product returns and exchanges and allow customers to oversee the whole process
• Seamlessly work with various shipping carriers to provide more shipping choices for your customers

Pricing

Magestore Order Management software comes with custom pricing. Contact the Magestore team to get a quote based on your business needs and states.

2. Zoho Inventory: Best for small online businesses

Zoho Inventory comes with many features that help business owners optimize their eCommerce order fulfillment. This eCommerce fulfillment system supports creating packing slips and shipping labels with ease, at the same time finding real-time shipping costs for each shipment. What’s more, sellers can also consolidate all unfulfilled orders from the same customers into a package for convenient shipping.

With Zoho Inventory, online merchants can track packages after shipping and keep customers updated. There’s also no difficulty in watching the stock quantities across sales channels, setting reorder levels, reminders, and preferred vendors to timely re-stock.

Highlight features

• Manage multichannel orders in a single platform
• Allow users to easily and quickly create packing slips and shipping labels
• Find real-time shipping expenses for each package
• Track packages after shipping and deliver real-time updates to customers
• Support dropshipping in case of stockouts
• Enable merging all unfulfilled orders of a customer for single shipping
• Automatically keep inventory levels consistent through sales channels
• Track products through different stages with serial numbers
• Enable setting re-order levels, notifying, and choosing vendors for replenishment
• Support bundling items to sell as a single unit
• Keep close tabs on batches and expiration dates of products
• Integrate with many shipping carriers

Pricing

The prices of Zoho Inventory are charged per organization per month with 4 following plans.

3. Linnworks: Best for small and medium online businesses

Linnworks removes much of your manual work by automating many order eCommerce fulfillment processes. Besides centralized management of orders, Linnworks automatically routes orders for efficient fulfillment and compares shipping carriers to define the cheapest services for orders.

This eCommerce fulfillment software keeps you informed of stock levels across sales channels, warehouses, and bin locations in real time. If you’re using fulfillment services, Linnworks enables you to track inventory at their fulfillment centers for timely stock replenishment.

Highlight features

• Manage inventory from bin locations and warehouses in real time
• Manage orders from numerous sales channels in a single place
• Allow creating and editing any orders on the same page
• Attach tags to orders for easy and fast identification
• Automatically allocate orders to the right batches for shipping
• Support tracking inventory levels at 3PL fulfillment centers and demand forecast
• Use rules to route orders to optimize the order fulfillment process
• Compare shipping costs among carriers to find the cheapest service for orders
• Generate complete reports on key business metrics

Pricing

Linnworks hasn’t published the prices yet.

4. ShipBob: Best for startups or small businesses

ShipBob, a global eCommerce fulfillment platform, offers comprehensive fulfillment software for online merchants that perform in-house fulfillment or use the services of a 3rd-party service provider. The software enables users to set up reorder points and distribute the inventory between ShipBob’s fulfillment centers based on historical data. With ShipBob’s software, you can automate the returns process and keep track of all return information.

The software can integrate with different eCommerce platforms to streamline the order fulfillment process. The detailed reports delivered by the software, which provide pivotal data like sales on each channel, expenses, and demand forecast, give you insights to make informed decisions for business improvements.

Highlight features

• Track inventory levels, and notify when the stocks run low for replenishment
• Support stock allocation between warehouses based on historical order data
• Oversee orders from purchasing to delivery
• Filter orders using the tracking number, order type, order date, and more
• Provide detailed reporting to make business decisions
• Automate the returns process and allow users to track all returns
• Integrate with different eCommerce platforms like Shopify, WooCommerce

Pricing

You need to contact ShipBob for pricing details.

If you’re looking for a 3rd-party service provider to help you fulfill online orders, take a look at the best eCommerce fulfillment solutions below.

1. Shopify Fulfillment Network: Best for large Shopify businesses with high sales volumes

Shopify Fulfillment Network owns many eCommerce fulfillment warehouses that ensure your customers get products as soon as possible. Partnering with many major shipping carriers, Shopify Fulfillment Networks can help you deliver items to customers within 2 days at affordable costs. The services can fulfill orders from multiple sales channels and deal with order surges during peak seasons. Besides, it allows custom packing slips with your own logos or discount codes.

When it comes to business growth, Shopify Fulfillment Network is willing to give you practical advice on logistics and shipping. It also helps track your inventory in real time and handle returns effectively.

Highlight services

• Support fast and affordable delivery with their wide fulfillment center network
• Ship inventory from overseas to Shopify’s fulfillment centers
• Provide experts’ advice on logistics and shipping for business growth
• Deliver packaged and labeled stocks directly to one location within the network
• Fulfill orders across sales channels integrated with Shopify stores
• Handle flash sale fulfillment during peak periods quickly
• Support order fulfillment for subscription business
• Offer custom packing slips with logos or discount codes
• Support real-time inventory tracking and dynamic routing
• Assist fast and seamless returns with return rules

Pricing

Shopify Fulfillment Network charges a single fee per unit for fulfillment.

• Set-up fees: Free
• Receiving, picking, and packing fees: Included in a single fulfillment price per unit
• Storage fees:
  • 6-month free storage
  • $2.25/ cubic foot storage for products not sold within 6 months
  • Storage costs are calculated daily.

2. ShipNetwork: Best for large businesses with high order volumes

With fulfillment centers for eCommerce in strategic locations across the U.S., ShipNetwork offers 1-day fulfillment and 1–2 day ground shipping within the U.S. without increasing costs. The service provider also guarantees 100% of order accuracy thanks to their 3-point inspection process.

In addition, using the services by ShipNetwork lets you give customized experiences to your subscription customers with custom packing and delivery. ShipNetwork also has temperature-controlled fulfillment centers in the U.S. to serve some special product types.

Highlight services

• Guarantee 100% order accuracy with 3-point inspection
• Support 1-day delivery and 1–2 day U.S. ground delivery
• Offer sellers multiple shipping options with different costs and time
• Simplify the return process, manage, and handle returns efficiently
• Assist subscription fulfillment services with custom packing and delivery
• Bundle different items into a single unit for shipping
• Supply temperature-controlled order fulfillment centers in the U.S.
• Support lot tracking to manage and fulfill products by expiration dates

Pricing

You need to contact ShipNetwork for pricing details.

3. Fulfillment by Amazon: Best for online businesses selling on Amazon

Fulfillment by Amazon (FBA) offers you a comprehensive solution to storing, picking, packing, shipping, and answering your customers’ queries. Amazon has numerous warehouses worldwide, which helps expand your business reach to customers around the globe. Using Fulfillment by Amazon enables you to provide your customers with Amazon Prime two-day delivery free of charge.

In addition, Amazon develops many tools to manage your inventory effectively, from stock optimization to replenishments based on demand forecast, sales history, seasonality, and your own inputs. This eCommerce fulfillment solution provider also allows you to deliver all of your inventory to a single fulfillment center, then they’ll help you distribute the inventory for different locations when there’s a shipment.

If you sell products off Amazon sales channels but still want to fulfill with Amazon warehouses, you can consider their Multi-Channel Fulfillment (MCF) solution.

Highlight services

• Extensive fulfillment network around the world
• Provide many incentives to start using FBA like free shipping and returns
• Offer tools for managing excess inventory and tracking inventory age
• Restock inventory based on sales history, demand forecast, and seasonality
• Support fulfillment across different eCommerce sales channels
• Track orders after shipping until received by customers
• Handle customer inquiries and returns for products
• Offer the inventory placement service that allows sending all stocks to one fulfillment center
• Integrate with multiple eCommerce platforms like Shopify, BigCommerce

Pricing

FBA charges fulfillment costs for each unit, including picking, packing, shipping, handling, customer service, and product returns. The costs are calculated based on the weights and dimensions of the products.

• Set-up fees: Free
• Receiving fees: Not published
• Monthly storage fees:
  • For non-dangerous goods:

• • For dangerous goods:

Some sellers have to pay storage utilization fees besides the above base monthly costs.

• Picking and packing fees: Included in the fulfillment costs of each unit. We recommend you check it carefully to fully understand the pricing.

4. ShipMonk: Best for fast-growing online businesses

Considered one of the best fulfillment companies for fast-growing businesses, ShipMonk brings customers top-notch fulfillment services that can scale in conjunction with their growth. ShipMonk combines their best eCommerce warehouses, equipped with state-of-the-art technologies, and powerful software to support rapid fulfillment to customers while ensuring high-quality standards and cost savings.

ShipMonk speeds up picking orders with their automated mobile robots and automatically sorting packages for faster carrier pickups. It’s also customizable and adaptable enough to keep up with the rapid expansion of your business.

Highlight services

• Can fulfill 10o,000+ orders a day and support shipping to 200+ countries
• Enable cost-effective shipping with ShipMonk’s Virtual Carrier Network
• Support inventory management, including stock level forecast or bundle creation
• Offer customizable packaging to help deliver a unique unboxing experience
• Provide many options for reverse logistics to control costs like returning to stock, donating, disposing, reworking, and returning to vendors
• Automatically route your inventory to optimal storage areas
• Let users record, track, and address claims on the claims portal
• Integrate with many eCommerce platforms

Pricing

• Set-up fees: Free
• Receiving fees: Contact for a quote
• Monthly storage fees:

• Picking and packing fees: The actual amount you have to pay depends on the monthly number of orders that needs fulfilling.

For example, the picking fees for 3 levels of monthly order quantity are as follows.

table

Refer to their pricing plan to estimate how much you need to pay based on the actual order volume of your business each month.

5. Red Stag Fulfillment: Best for new sellers with special packing or handling needs

Red Stag Fulfillment is a company that provides eCommerce fulfillment services USA. Founded by eCommerce operators who understand clearly what online stores need to drive brand loyalty, Red Stag Fulfillment makes solid pledges for inventory and order accuracy. The company promises to minimize stock loss and damages, and give you complete visibility into inventory during each phase. On top of that, Red Stag Fulfillment also offers same-day eCommerce order fulfillment services so that your customers can receive their items as fast as possible.

Highlight services

• Support order, inventory, and warehousing monitoring
• Reduce a considerable amount of inventory loss or damage by minimizing supplier errors, receiving errors, employee theft, improper handling, and expired stocks
• Consolidate as many items as possible into a package to lower shipping costs
• Provide same-day eCommerce shipping and fulfillment
• Deliver real-time and mobile reports on fulfillment operations
• Monitor return processes and handle return requirements in no more than 2 days
• Support custom packaging to protect items from damages

Pricing

Red Stag fulfillment pricing is as follows.

• Set-up fees: Free
• Receiving fees: $14.25/pallet or $6/non-pallet package
• Monthly storage fees: $0.75 per cubic foot, based on the daily inventory average for items stored no more than 180 days
• Picking and packing fees: $1.80 – $2.25 per package, and $0.32 per item after the first item in each order

Geared towards Magento merchants, Magestore Order Fulfillment possesses many outstanding features to assist SME business owners in dealing with a high quantity of orders smoothly and accurately. With multiple charts and insightful reports, retailers can optimize order fulfillment operations, thus delivering the best eCommerce fulfillment experience to customers.

As fulfillment is an inseparable process of retail operations, retailers should streamline the whole operations to get the optimal performance and complete view of business performance. A good way to simplify retail operations is using a full-fledged Magestore Retail Management PWA, which includes inventory, procurement, reporting, and also the Magestore Order Fulfillment modules.

Let’s talk to our experts to get straight to your business pain points and find out the best eCommerce fulfillment solutions for your retail business now.

1. What are the fulfillment strategies for eCommerce?

The fulfillment strategies for eCommerce refer to the methods employed to manage the process of receiving online orders from customers, preparing orders, and delivering products to them as fast as possible.

2. What does a fulfillment company do?

A fulfillment company is a 3rd-party organization that helps business owners fulfill their customer orders, which often includes managing inventory, picking and packing items, shipping products, and handling returns.

3. Is outsourced fulfillment right for you?

It depends on the number of order volumes, product types, customer locations, and other factors. To decide whether outsourced fulfillment is a good fit, retailers should consider different aspects of their business carefully. Please refer back to the section—What to consider before opting for an eCommerce fulfillment solution—we’ve discussed previously.

Cash flow is the amount of money going in and out of your business. Cash inflows come from customer purchases while cash outflows happen when business expenses incurred such as inventory replenishment, operating bills, staff salaries, etc. 

Cash flow management refers to all activities involving receiving, collecting, analyzing, monitoring, and managing cash inflows and outflows. 

When it comes to in-store cash flow management, the managing scope focuses on retail physical stores as its name suggests. A realistic plan for managing cash flow requires business owners to fully realize and understand the sources of cash flow in their stores.

Cash flow is the backbone or lifeblood of business. According to Investopedia, the top common reason a small business fails is financial hurdles which are mainly about poor cash flow management. Whether you are running a small or big business, you should never give careless consideration to it. As managing cash flow in offline stores is a part of managing cash flow as a whole, we’d like to first summarize the key reasons why cash flow management matters.

You need enough cash to cover business costs.

As business owners, you need to ensure to have money available at your disposal to pay for expenses when they are due. You should know that even lucrative businesses can break down if they fail to manage cash flow properly. If you don’t have enough money to pay for suppliers or employees, suppliers will stop supplying you with products and employees will leave you.

You need cash to grow your business.

Let’s take a typical example in the retail business. The holiday season is just around the corner and you want to increase sales by providing customers with the newest items or investing more in marketing activities.

However, your operation bills are due soon and you don’t have enough money left. In this case, effective cash flow management is more than ensuring you have money to balance the cash inflows and outflows. The effectiveness is about having idle cash for future purposes as well.

You need cash to survive in crisis situations.

COVID 19 pandemic is a harsh test on the global economy which sped up the classification of strong and weak businesses. No one can anticipate exactly when such severe situations could happen. As business owners, you should always be aware of the future and also have plans for crises. In other words, you need money to survive and then thrive in your business.

Besides the central importance above, you should pay attention to other benefits the good in-store cash flow management can bring to your business.

You can ensure there are no or least cash differences between the system and reality.

If you see any cash differences, you can right away check the cash you have in stores with the system to spot the problem. Sometimes, your staff uses cash to pay for electricity bills and forgets to record the transaction in the system. That causes the cash differences. As your staff in physical stores works closely with the POS system, you can make use of the POS to record such transactions.

It helps you anticipate the cash flow trends in your stores.

In physical stores, you should look at the cash flow on day-to-day basics. For example, if you see that customers are more likely to visit your stores during lunchtime or late afternoon. You should assign more staff to those working shifts. Another example is, you’re going to have a negative cash flow at the end of the month. You want to figure out the root cause of it. And you find that it’s poor inventory management that you have a lot of old inventory unsold. You then need to immediately seek an on the spot solution.

You don’t have to always purchase goods on credits.

When sales seasons come, you want to replenish inventory with new items but lack money. Then you have to pay on credits. If you rarely encounter this situation, then congratulations, you are managing your cash flow properly. But if this case sounds often to you, you should give thoughtful consideration to in-store cash flow management.

Managing cash flow is not an easy task. You can imagine that you are holding a scale with one side of cash inflows and the other side of cash outflows. As business owners, you prefer the inflow side to incline, don’t you? In this part, we would share with you tips to monitor cash flow in physical stores appropriately.

Review your current cash flow management

Before applying anything new, you’d better review your current managing tasks to see any possible issues. Let’s go through your sales reports, operating activities, financing activities, investing activities. Then pay attention to these vital components: cash, inventory, debt. Some questions you should ask yourself when reviewing are:

• How much money are you having? How long can you finance your business with such an amount?
• How much of your capital is laid in inventory? How long can you free up all inventory? What can you do to speed up inventory sales?
• How many of your debts are about to be due? Can you pay all that with your equity?

Increase cash inflows

It is obvious, isn’t it? After knowing how your in-store cash flow management is going, it’s now time to find ways to improve the cash flow. Cash inflows come from the customer’s purchases. Thus, the very first thing you can do is to generate more sales. You can induce your existing customers to re-engage and buy from you. In this case, a customer loyalty program can help you a lot. Or you can invest in the promotion to attract new customers. In fact, you should do both activities.

One thing you should notice is that your in-store service and decoration also helps boost customer shopping experience. The more you care about your customers, the more chances you can win their hearts.

Another notice is you should always follow the retail changes to better predict the sales trend. You’re about to have more sales in physical stores, meaning you’ll have more customers visiting your stores. You can consider assigning more staff to your stores to better serve customers.

Decrease cash outflows

Minimizing cash outflows is an inseparable part of in-store cash flow management. Let’s see how to handle it. 

Carefully manage inventory: do you want to import new products just to store in your warehouses or pile up your inventory? Of course not, right? But if you don’t have a clever inventory management plan, you are doing that without notice. Noticeably, poorly managing inventory can breed you to the verge of debt. Remember to always keep an eye on your inventory on a daily basis.

Reduce fixed and variable costs: internet, phone, rent, staff salaries are some of the fixed costs incurred during the year. Besides, you also have to pay for variable expenses like shipping fees. 

As your daily operations seem to tie closely with a POS system, you can surely take advantage of your powerful POS to manage inventory and staff performance. A POS system allows you to record and track inventory in real-time, separate staff log-in to measure each staff’s performance is a good fit for your business.

Make use of your unused assets

Let’s go around your stores to see if you have any unused or unneeded assets. If there is any, you can sell it out to make space for inventory storage and collect some free cash.

In-store cash flow management reminds you of reviewing, analyzing your current cash flow activities to adjust and have a better managing plan for your retail business. The earlier you start working on the more comfortable you feel when operating a business. If you need further discussion on how to design a good-fit plan for managing cash flow in your physical stores, our dedicated experts are always willing to help.

Store fulfillment is an omnichannel fulfillment strategy that leverages established brick-and-mortar stores to fulfill and ship online orders. In other words, business owners can stock inventory in their physical stores, and then designate the nearest store to the customers to fulfill their online orders. 

What underlies in-store fulfillment is the idea of transforming a brick-and-mortar store into a micro-fulfillment center or distribution point and making stores an integral part of the supply chain. This strategy facilitates diversified store fulfillment models, such as buy online, pick up in store (BOPIS), curbside pickup, and ship from store to deliver a more flexible and convenient shopping experience to customers.

What are store fulfillment examples?

Many well-known brands like Walmart have incorporated store fulfillment into their omnichannel retail strategy.

Walmart has turned their 4,700 stores scattered across the U.S. into fulfillment centers to accelerate order processing and delivery. The retail giant gives shoppers a view of offline and online inventory, lets them place orders online, and then choose to pick up their items in a local store or get them delivered. Walmart also makes the return process easy and convenient by allowing customers to return their purchases in 4 ways: return at Walmart stores, schedule for pickup, return by mail, and drop off at FedEx locations. 

Many omnichannel retailers adopt in store fulfillment as it generates enormous benefits in terms of cost reduction, resource optimization, customer satisfaction, and sales improvement. 

Reducing costs

Online store fulfillment allows shipping products to customers from a nearby store rather than a faraway fulfillment center, thus lowering transportation costs. With the BOPIS, sellers can even eliminate shipping expenses since customers come to the store to pick up their purchases. Besides, by utilizing the space available in physical locations, shop fulfillment removes the need to build or hire more warehouses to stock inventory for order fulfillment, which helps save a considerable amount of money.  

Maximizing business resources

Store fulfillment is one of the best ways to help retailers capitalize on their current resources. Order fulfillment at stores enables sellers to utilize the storage capabilities of offline stores for stocking inventory, especially the ones with low in-store sales volumes. Besides, the strategy also optimizes the labor force at physical stores. You can assign new fulfillment responsibilities to your store staff, thus improving store efficiency and employee productivity during low seasons.

Improving customer satisfaction

Transporting online orders from the store close to customers increases delivery speed so that shoppers will receive their desired products as fast as possible. Buyers also have the option to collect their purchases by reaching the nearby store to get instant gratification. In 2023, 68% of U.K. customers favor the click and collect delivery method because of its great convenience. 

With a store online order fulfillment strategy, retailers can display a wider range of products to customers regardless of the stocking locations, thus giving them more product choices while reducing stockouts. 

Increasing sales and margins

The BOPIS fulfillment option drives more traffic and sales to physical stores as customers can browse and discover other items when picking up their orders. As shown by invespcro.com, 49% of buyers make additional purchases while collecting their products in store. 

Store fulfillment enables retailers to sell slow-moving products in stock by displaying them at the checkouts, entrances, and other noticeable positions in their brick-and-mortar locations. 

Besides boosting sales for idle inventory, in store fulfillment helps improve profit margins. Allowing customers to shop for any products on hand reduces the risk of having too much stock and limits the possibility of markdowns when the season ends. 

Before implementing store fulfillment, you should look into the following aspects of your business.

Store capacity

Understanding the capacity of your store network helps you decide which one should join the store fulfillment initiative. What needs considering is whether a specific store has enough space available for stocking inventory and whether the store location and human resources can assist in fulfilling online orders without taking a toll on in-store sales. 

Product availability

Taking your product range into consideration can do you a great favor if you don’t want to carry out store fulfillment at the expense of offline sales. You’d better think about which types of products are on eCommerce storefront only, which are exclusive to physical locations, and which are available both online and in store. The choice of products for each channel may depend on certain factors as follows. 

• Sales channels: Assess on which channel a specific kind of product often sells most
• Product type: Consider whether the product is easily damaged or costly to transport, which affects the shipping costs and return rates.  
• Profit margin: Calculate the expenses to sell a product type on different channels to see which channel brings you the best margins

Order volume

To avoid stressing out your employees and decreasing fulfillment efficiency, especially during the peak season, you should consider the total number of orders, the order volume of each store, and the number of store employees available. On that basis, you can decide which store you should set apart for fulfillment or how many orders each store should fulfill. It’s reasonable to choose stores with sufficient labor availability and low in-store sales to handle online orders. 

Inventory stocking

How much inventory to stock in distribution centers and physical stores at different periods also counts. To reduce stockouts and maintain appropriate stock levels across channels and locations, you should consider the amount of inventory to stockpile and the stock replenishment strategy. An inventory and purchasing system which can update stock levels in real time and notify you when and how much to replenish will simplify your procuring and stock control operations. 

The implementation of store fulfillment faces numerous challenges. Here we list the most common obstacles business owners must overcome to launch the strategy. 

Lack of inventory visibility and accuracy

Lack of inventory accuracy can cause serious harm to your business. The stock mismatch between online and offline storefronts and the inability to track in-store inventory might lead to frequent stockouts and unexpected delays in order fulfillment.

As a result, the most pivotal challenge is gaining accurate visibility of your inventory across channels and locations in real time. With instant updates of inventory levels, sellers can easily route the orders to the store with the required stock for fulfillment.

Inappropriate inventory allocation 

Serious consequences can ensue the inadequate inventory allocation, for example, the shortage of merchandise where there’s high demand or having to ship products that customers require from further locations. Therefore, it’s beneficial to maintain the right stock levels at the right locations. 

How to allocate inventory for each channel and each store is not an easy task. You need to forecast demands during the seasons across channels and then assign a proper stock volume to each location. 

Inefficient fulfillment processes

Store order fulfillment might be more challenging than it seems to be since it requires a smooth coordination between physical and digital processes. If not implemented correctly, it can result in damaged products, stockouts, and inefficiencies. 

Unlike dark store fulfillment which involves locations dedicated exclusively to shipping and picking, brick-and-mortar retail stores are not designed specifically for fulfilling both online and offline orders. Store employees are also not trained to efficiently perform fulfillment tasks such as picking, packing, and shipping. This might make order fulfillment more time-consuming and labor-intensive or lead to confusion when dealing with product returns and exchanges. 

Then the challenge is how to optimize in-store operation to improve efficiency and speed across locations and sales channels. 

Legacy retail systems

To enable omnichannel store fulfillment, integrating disparate retail systems is a must, but this will be highly unlikely if you’re using legacy retail systems that can’t connect with other apps and software. Your store POS, ERP, and eCommerce platforms should work well together so that you can get a comprehensive view of your business across channels to better manage your orders, fulfillment processes, and more. 

By consulting our experts and researching the best practices of many big brands like Walmart, we now come up with the 4 key principles to follow for the effective adoption of online store fulfillment.

1. Invest in the right technologies

The top principle for implementing shop fulfillment is investing in the right technology stack. It’s best to have store fulfillment software that can assist you in managing inventory and order processing across sales channels. Consider your needs carefully to pick the most suitable ones.

Besides, modern retail systems that can integrate well with each other can support seamless workflows and facilitate automated in-store fulfillment, which boosts efficiency and cost-effectiveness. It’s also advantageous if your tech stack can be flexible and adaptable enough to accommodate the ever-changing needs of your business. 

2. Provide adequate training for your store staff

Your store employees, who contribute to delivering a consistent shopping experience to customers and boosting repeat purchases, play a crucial role in executing the in-store fulfillment strategy. Make sure to provide your staff with adequate training so that they can harness the technologies available and perform additional tasks of fulfilling online orders like picking and packing with ease. 

The training should equip your store associates with the necessary skills and knowledge to meet various customer expectations and suggest a way to handle increasing order volumes effectively to avoid being overwhelmed. The training checklist should include the following. 

• Picking: How to pick products for online orders effectively without affecting in-store customers
• Packing: How to pack products properly to avoid damages, delays or loss
• Shipping: Develop a shipping process and ensure that your staff follow it correctly
• Tech stack: Instruct your staff to use relevant tools to reduce manual work and accelerate the fulfillment

3. Offer clear and easy-to-follow return policies

Processing multichannel orders may be demanding, yet it should not cause any hassle for customers who wish to return their purchases. Most shoppers expect an easy and convenient return process, like allowing customers to buy online and return in store. Needless to say, you should determine your return policies for orders fulfilled in store and communicate clearly with your customers to avoid any future friction. 

4. Stay customer-centric

No matter which retail fulfillment strategies you’re implementing, customers should always be at the heart of your operations. In the end, what matters is that you make a sale and satisfy customers so they may come back for more purchases in the future. Therefore, whether they buy online or in store, you should ensure they get the best customer service and convenience as expected. 

Keeping close tabs on your customers’ expectations does more good than harm. Observing their buying patterns can give you a good understanding of their need to offer them their preferred fulfillment options. You can also learn from other big retailers to optimize your omnichannel strategy to customers’ demands. Some exemplary retail giants are Target, Best Buy, and Macy’s.

• Best Buy provides diverse order pickup options, including store pickup, curbside pickup, and pickup at UPS and FedEx stores, CVS Pharmacy, Walgreens, or any of their pickup locations. 
• Target enables customers to order items on the website or app, then collect the products at Target stores or have them brought to their cars in the parking space at a Target store. It also supports curbside returns.
• Macy’s: Macy’s offers BOPIS, curbside pickup, and ship-to-store order fulfillment options. Besides, it allows users to exchange and return the products purchased online at stores or by mail.

The key to effective store fulfillment is to manage all of your retail data in a single place. Magestore provides you with a comprehensive retail management PWA to streamline your store operations across online and offline channels with highlight features as below. 

• Sync inventory and order data between eCommerce website, POS, and back office in real time
• Track product quantity and locations with stock on-hand reports
• Oversee entire inventory movement, from purchasing to sales
• Allow setting up low-stock threshold to inform stock replenishment
• Generate purchase orders based on demand forecast
• Manage order processing across channels in real time
• Speed up order processing with simple pick-pack-ship workflow
• Customizable to integrate with 3rd-party shipping services 

At physical stores, Magestore POS helps retailers handle many fulfillment solutions, such as buy online and pick up in store, buy in store and ship to home, or buy online and pay in store with the store pickup feature. Besides, Magestore supports dropshipping and return management. Thus, you can offer your shoppers a flexible and pleasant experience to encourage their repeat purchases. 

Getting consultancy based on your unique business needs is a good way to save your time and money. Talk to our experts now to find out the most optimal solution for your case! 

1. What is flow-through fulfillment?

Flow-through fulfillment is a process of gathering products from different locations into the distribution center. The products are then re-sorted based on the delivery destinations and shipped out within the same day. 

For example, Walmart has 210 distribution centers across the U.S. Each distribution center supports 90–100 stores in a 150+ mile radius, to collect all product types, sorts the items, and transports them to specific store locations. 

2. What is the difference between warehouse fulfillment and store fulfillment?

While store fulfillment means fulfilling online orders from a physical store closest to the customers, warehouse fulfillment is an inventory fulfillment method that processes orders from warehouses rather than brick-and-mortar stores. 

3. What is direct store delivery?

Direct store delivery enables shipping products directly from manufacturers or suppliers to retail stores. This distribution method reduces the number of touchpoints, thus improving efficiency and lowering labor costs.

Hybrid dropshipping is a way of enabling retailers to both:

• sell products from their own local inventory
• place the orders directly with the manufacturer or a distributor. It happens when an SKU goes out of stock locally, or retailers don’t want to stock that item on purpose.

This approach enables you (as a retailer or distributor) to seemingly always have products in-stock, get the best prices, and have a variety of items in your catalog to fulfill the customer needs. We call this hybrid dropshipping, and it’s not just for the big retailers or wholesalers anymore. New software and services have made it accessible to everyone.

In detail, retailers using hybrid dropshipping will need to stock their own products in local stores or warehouses and fulfill orders as normal. This also includes products that are shipped via third-party logistics companies (3PL’s). Meanwhile, they also prepare a dropshipping operation or a system to fulfill dropship orders. The orders will be directly shipped from a manufacturer, distributor, or other third-parties after you request a dropship purchase from them.

Dropshipping methods are not new. Everyone seems to know about this way of fulfilling retail orders. To create your own hybrid dropshipping model, you simply need to understand the three most applicable stakeholders that make up the dropshipping supply chain: manufacturers or wholesalers, retailers and customers. Hybrid dropshipping will still involve these players in the process.

Manufacturers or wholesalers

Manufacturers produce the product and normally do not sell directly to the public. Instead of that, they often sell in bulk to wholesalers or retailers. Buying directly from the manufacturer that offers dropshipping is the cheapest way to purchase products for resale. However, most purchases require minimum order requirements you’ll need to meet. You as a retailer can buy a minimum quantity level and store the products at their warehouse. Every time you have an order, they might have a team to handle the distribution and fulfillment parts for dropship orders.

Wholesalers can also be your dropship supplier. They buy products in bulk from manufacturers, increase the price based on their own profit calculation and other factors, and then sell them to retailers for resale. Many wholesalers offer dropshipping to increase the chance of selling products to more retailers and end-users.

Retailers

A retailer sells products directly to the public, stocking their products from manufacturers or wholesalers. If you run a hybrid dropshipping business that fulfills your orders via dropshipping suppliers, you’re a retailer.

Customers

The customer is the one who places an order for a product on the retailer’s online store or marketplaces such as Ebay and Amazon. They have touchpoints with both retailers and suppliers (manufacturers or wholesalers or third-party shipping providers).

1. Define the order process of your business

Now that you understand all the stakeholders involved, let’s take a look at how a dropship order gets processed. To illustrate, we’ll explore this process with our theoretical Magento store, Sports Outlet, an online-offline merchant that specializes in accessories for sports gear. They’re operating a normal retail selling and also dropships most of its products directly from a wholesaler called Wholesale Accessories. Alex will be the Sports Outlet’s customer in this business case.

The following is an example of how the entire dropshipping purchasing and fulfillment process might look with our theoretical store:

Step 1: Customer places an order with Sports Outlet 

Alex needs to buy a runner T-shirt and places an order via Sports Outlet’s eCommerce store. Once the order is validated, Sports Outlet and Alex will get an email confirmation of the new order that is automatically generated by the Magento system.

The payment from Alex is captured during the checkout process and will be automatically transferred into Sports Outlet’s account.

Step 2: Sports Outlet sends a dropship request to their supplier

In this step, Sports Outlet goes to the Magento system and marks the order as dropship order if that is a dropship product or the product is out of stock. Then they proceed with the purchasing and fulfillment parts. Staff at Sports Outlet will prepare to fulfill by creating a dropship request and send the email order confirmation to a sales representative at Wholesale Accessories. Wholesale Accessories has Sports Outlet’s credit card on the file and will bill it for the wholesale price of the goods, including any shipping or processing fees.

Step 3: Wholesale Accessories ships the order

In this case, let’s assume that the item is in stock and the wholesaler is able to charge Sports Outlet’s card successfully. Then, the supplier Wholesale Accessories will pack the order and ship it directly to the customer. The shipping address information is from the dropship request sent earlier from Sports Outlet.

Although the shipment is from Wholesale Accessories, Sports Outlet’s name and address will appear on the return address label. Besides, their logo will display on the invoice and packing slip. Once the shipment has been confirmed, Wholesale Accessories will send an email to Sports Outlet with the invoice and a tracking number generated from a shipping agency.

The turnaround time on dropshipping orders is often very fast. Most quality suppliers can be able to deliver the package to the customer’s door in just a few hours. This makes the selling process of retailers run smoothly, like normal order fulfillment.

Step 4: Sports Outlet alerts the customer of shipment

After receiving the tracking number, Sports Outlet will add this number to the system and update it to the customer, likely using an email interface that’s built in from the online Magento system. After the order is shipped, Wholesale Accessories collects the payment and updates the order tracking status. The customer will be notified automatically since Sports Outlet has updated the tracking number in their system earlier as well. Now, the order and fulfillment process is complete. Sports Outlet’s profit (or loss) is the difference between what it paid Wholesale Accessories and what it charged Alex.

Find an omnichannel solution supporting hybrid dropshipping

To get started with this hybrid dropshipping model, you’ll need to get up to date inventory quantities from all of your vendors. This includes the updated inventory quantity from your own warehouse(s) and any 3PLs that you have products stored as well as external distributors and manufacturers. It means you need a system that allows you to manage suppliers.

You’ll also need an automated system that can pull in inventory quantities from multiple vendors for a single product, sum those inventory quantities and update the total inventory quantity to your shopping carts or other selling channels.

Furthermore, you would want the order fulfillment system to work smoothly with dropship orders from suppliers. When sending dropship orders to vendors, you’ll need your order fulfillment system to send orders to only the vendor who has the products in stock. It’s also recommended that your order fulfillment system is able to collect unit cost data from various vendors. Find a system that allows you to route orders to the vendor with the product in stock at the lowest unit cost. If there are multiple vendors for a single product, you can then assign orders to the lowest cost distributor.

There might be a lot more features that you need to create a successful hybrid solution. If you want to implement a hybrid dropshipping system suggested above for your business, check out a demo of Magestore omnichannel solution today.

What is a product catalog?

A product catalog is simply a set of information about all the products that you are ready to showcase on your website. A product catalog on a website acts as product display booths in an offline store. Depending on customer understanding or business purposes, the information in product catalogs is divided into different sub-categories varying from industries to industries.

(An example of a product catalog on Magestore POS)

What does it include?

A product catalog typically includes the following information:

• Product name, title
• SKU (Stock keeping unit) (which is unique for each product used for inventory management)
• Product category/sub-category
• Dimensions (size, length, volume, height, etc.)
• Product description/short description (constituents, features, version, year of the launch, ideal conditions of usage, safety measures, etc.)
• Price
• Pictures 
• Terms and conditions

Who needs a product catalog?

To better answer the question: “Why is product catalog management important”, we first should understand who needs a product catalog.

• Merchants: you are the very first one to need this information. You need it to showcase what you’re selling to customers, for inventory management, for marketing activities.
• Customers: they are the ones reading your product information the most. Before making a purchase, they will research the products carefully, consider information from various sources. If they visit your website and see that you’re providing the items they demand, they are more likely to buy from you. In this case, a concise and comprehensive product showcase on your website will help you win these customers.
• Your sales staff: They may be the second-most readers of a product catalog. Your sales staff can refer to the product catalog to communicate, consult with customers about the product benefits or other crucial information about a product.
• Your partners: You’re a wholesaler and have a lot of retailers, do you like to spend some time every day just informing or answering questions about products again and again from your retailers? It’s kind of time-consuming, isn’t it? Show them your well-organized and real-time product catalog to save time for both.

What is product catalog management?

Product catalog management is now a must-have in retail businesses. The managing task refers to the strategic approach of structuring, organizing, standardizing, and publishing the product information across all online sales channels. To put it simply, it is about maintaining the product database in a well-organized and well-structured manner and keeping it up to date.

Why is it important?

Now that you’ve known what product catalog management is and who needs the product catalog. Thus, it’s now easier to understand the importance of product catalog management. A well-organized, concise product catalog on your website will help you set up a foundation for your business.

Create an Omnichannel experience

Going omnichannel is now more than just a trend. It may be one of the best ways to operate a retail business thanks to its outstanding benefits over multichannel. The primary concern of any retailer is to maintain a consistent omnichannel experience. Effective and proper product catalog management will allow you to ensure the correction and consistency of the product database.

Enhance customer service

When a customer visits your website, does it mean you’ve successfully won this customer? It’s too early to make that conclusion. You want that customer to have further engagement with you. The customer will read the product information provided on your website and compare it with other information they’ve collected from different sources.

If they can’t find the information needed or find the information confused or poorly organized, they will soon leave your website and may never come back. When you haven’t had the opportunity to talk directly with customers, let your powerful words on your website take the lead.

Develop your business

Looking at a good product catalog management, you can easily see what products you can sell fast, what your key products are. Based on that, you can add more products to your catalog, have more marketing activities to promote key products. That is how excellent product catalog management can grow your business.

Offer relevant and quality product information

This is the first and foremost point to notice when talking about managing a product catalog. As business owners, you need to make sure you’re delivering the correct and updated information to your customers. This helps ease the product search process of customers and increase their trust in your brand.

Categorize your products properly

How you convey product information to customers is as important as what information you want to convey to them. At this point, you should pay attention to easy product navigation options and clear categories. For example, your first product catalog looked like this:

Fashion Store

• Casual clothing
  • Women
  • Men
  • Children
• Underwear
  • Women
  • Men
  • Children

But after you’ve observed your customer’s behaviors carefully and consulted from other stores, you decided to change the current catalog to:

Fashion Store

• Women
  • Casual clothing
  • Underwear
• Men
  • Casual clothing
  • Underwear
• Children 
  • Casual clothing
  • Underwear

Another example maybe instead of using L to denote Large size, you change it to 38. A good product catalog structure comforts the filtering process of customers.

Provide alternative products

An effective product catalog should not only show the right products customers are looking for, but also can suggest alternatives for different products. This benefits both your customers and you.

One tip in this part is to use tags. Sometimes, customers don’t have a particular intent for a specific product, they just search for products by keywords. In this case, your search result should show them many options rather than just a few ones. When your customers have more choices and you have more chances for upselling or cross-selling.

A good product catalog shows how profoundly you understand your customers which is the pillar stone in successfully managing a product catalog. When you haven’t had the opportunity to talk directly with customers, let the powerful words on your website interact, and keep customers staying. For more discussion about how to design a great-fit product catalog management plan, let’s talk with our experts.

Every day, hundreds or thousands of inventory activities may happen in a business. They create an increase or decrease in the quantity of products.

Let’s explore eleven operations that can create a change of quantity in stock.

1. Deliver items ordered from both website and POS to customers 
2. Return items after customer’s refund or exchange
3. Purchase items from suppliers 
4. Return items to suppliers
5. Dropshipping
6. Transfer items between warehouses
7. Adjust inventory 
8. Stocktaking
9. Delete items in the product catalog
10. Import product list including quantity as master data for the first time using the system
11. Changes in the warehouse structure

To run a business efficiently, merchants nowadays need to utilize technology such as websites, POS system, inventory, or an ERP system. However, no system is perfect, and there’s no guarantee that everything will run smoothly at all times. 

In particular, in inventory systems that record a lot of transactions every day, the differences between theories and real quantity can happen in any period. 

Human error or system issues are where the differences can come from. For example, your staff is unfamiliar with the system, so they record the wrong quantity when receiving items from the supplier. 

Your system upgrade can also result in conflicts and data differences.

Let’s find out some inventory management pains that merchants can face: 

• The system doesn’t record a decrease in quantity although items have been shipped to customers or record an incorrect number.
• The system doesn’t record an increase in quantity although items have been returned to warehouses.
• The quantity doesn’t change after an inventory adjustment or transfer.
• The order is not synchronized to the admin backend.

To help merchants relieve headaches of stock discrepancies, Magestore has released the stock movement report feature on the POS system as well as retail management software.

The report will save and display all information about the stock movement by item in a grid for easy tracking.

Let’s see how it looks!

Inventory movement report in Magento backend

(Inventory movement report on Magestore POS system) 

• Date: Day, month, year, and hour your business create changes of quantity
• Status: It shows Completed if there is no error in the stock change update. In contrast, it shows Failed.
• Product info: Names and codes (such as SKUs) of items that increase or decrease in quantity
• Action: Activities or reason that results in the changes of quantity such as ship to customers or transfer between warehouses
• Source: Location that has the changes of quantity
• Old quantity: Quantity on hand before the changes
• New quantity: Quantity on hand after the changes
• Change of quantity: Quantity of stock moved into or out of the location. For example, if you ship 2 items to a customer, it means that the quantity decreases by 2. The report then will show -2. In contrast, if you receive 3 more items from the supplier, you can see +3 in this column. 
• Action details: The reference that results in stock changes. Admin can click the link to go to the reference such as a purchase order, a sales order, an inventory adjustment, etc.
• User: The person in charge of tasks that created the quantity change.

Magestore inventory movement report includes the following information:

Besides viewing the report, you may want to export it in CSV or Excel for later reference or sending to others.

(Merchants can export inventory movement report CSV file on Magestore POS system) 

Last but not least, merchants can check the list of error orders in a centralized view and proceed to correct inventory data.

(Merchants can check the list of error orders on Magestore POS system) 

Inventory movement history on PWA

The inventory movement report is also available on our Retail Management PWA. With it, store managers can keep track of inventory transactions in their location.

For more details, check out our detailed article on managing inventory on a Magento PWA.

You may invest in a big website, POS system, or a huge inventory system with multiple warehouses and forecasting. However, it still lacks an overview of how each item moves in and out. 

The inventory movement report offers a place to detect issues and find the solution to solve them. 

If you’re interested in implementing a movement report that gives you peace of mind, don’t hesitate to contact us now.

A purchase order (PO) is a document issued by the retailers to the suppliers. It serves as an official agreement between the buyer and the seller about a sale. Purchase orders usually outline what merchants need, how much, and when.

Purchase order is one of the vital documents during the procurement process. It’s important to distinguish PO from other purchasing documents such as invoices or purchase requisitions.

Purchase orders and invoices

Merchants will create POs at the start of the procurement process to define what you need from your suppliers. On the other hand, invoices are usually generated by the supplier at the end of the process to request payment.

Purchase orders and purchase requisitions

Purchase requisitions are for internal purposes. Departments in your business might submit purchase requisitions to your purchase or finance department to get permission to purchase from suppliers. Purchase requisitions are for internal approval; POS are for the purchasing process.

A PO can include the following information:

• Purchase order number: Each PO has a unique number that both retailers and suppliers can use to track status and payment. Shipping papers and invoices will also reference this purchase order number.
• Date: The date you issue the purchase order
• Supplier information: The name, phone number, address, any other contact details of the supplier
• Delivery information: The contact, address, and date for the supplier to ship products to you
• Invoice information: The contact that receives the invoices. This can be the same contact for delivery or a different department such as your finance department.
• Product: Names and codes (such as SKUs) of the items you’re requesting from the suppliers. POs usually use the product codes of the supplier.
• Quantity of each product: Number of items to purchase
• Payment information: The amount that you expect to pay your suppliers and payment terms

Purchase orders aren’t just legally binding documents between you and your supplier. They also help improve your inventory and finance operations. Let’s look at the 3 key benefits of purchase orders to your business.

Manage your budget better

When you create a purchase order, you agree with the suppliers on the price and payment terms. Based on the PO, you can calculate the funds you’ll need to set aside and how long you have to get the budget.

By looking at past POs, you can build spending reports and identify your spending trends. These reports help you calculate cost prices and sales prices. Now you know how much you’ll need to sell to make a profit and control your costs better in the future.

Track inventory accurately

POs serve as references to ensure your warehouse employees receive the right products and the right quantity.

Retailers get a clear view of inventory levels with POs. A purchase order gives you a record of how much stock you’re ordering and the time they’ll arrive at your warehouse. With this information, you can decide if you’ll need to order more goods to meet customer demands.

Identify the best suppliers

Warehouse managers should monitor supplier performance with a centralized purchase order management system. You can analyze which suppliers have the best prices and deliver the products on time and correctly.

With these records, you can prioritize purchasing from preferred suppliers and get better discounts for larger orders.

Purchase orders make your buying processes more efficient. Next, let’s walk through the process to create a PO.

The purchase ordering process is one part of the broader procurement process. A procurement process also includes activities like identifying and confirming your business product needs.

In this article, we’ll focus mainly on the process to make a purchase order. It includes the following steps:

Let’s go into the details of each step.

Retailer issues PO to supplier

Your purchase or finance department will draft a purchase order to send to the suppliers. Your PO should include as many details as possible, including the products, quantity, and when you need them. Retailers can create PO based on:

• Predicted demands: If you anticipate a holiday rush, you can order early from your suppliers to make sure you have enough products to sell. An inventory forecasting solution helps identify future demand for your products.
• Current backorders: You can work out how much stock you need to replenish to fulfill orders with out of stock items.

Supplier reviews and confirms PO

Once your supplier receives the PO, they will review all details such as quantity, due date, total amount, or other terms and conditions. If they don’t have enough goods or are concerned with some information with the order, they will request amendments or cancellation.

If there aren’t any issues that require further discussion, your supplier will approve the PO. Then they will prepare to send the goods to the delivery address on the PO.

Retailer receives and checks the goods

The third step in the purchase orders process is to receive items from the supplier. In this step, your warehouse employees can conduct a quantity and quality check. If there are missing or broken items, you can notify your suppliers.

If the received products all meet your requirements, your staff will sign the goods received note. This document records the quantity, delivery condition, and any other necessary information.

Retailer pays invoice and closes purchase order

Before you pay your supplier, your procurement staff can perform a three-way matching to confirm all documents. They will cross-verify the supplier’s invoice, the PO, and the goods received note.

Once everything is confirmed, your procurement departments can forward the invoice to your finance department for payment processing. The finance department can submit payment based on the agreed terms.

You can complete the purchase order process. Your staff then transfer the items to your warehouses or stores.

Different retailers will adopt different approaches to procurement. Here are 4 best practices for you to achieve an efficient purchase order process.

Write clear purchasing guidelines

Establishing purchasing policies and processes is essential for your staff when they purchase on your behalf. The guidelines ensure a consistent and quality purchasing process and save your staff time and confusion.

Your guidelines can include topics like POs approval process, supplier selection, and examples of purchasing scenarios.

Build supplier database

Retailers should keep records of all suppliers you’ve ever purchased from. Your database should at least include the supplier’s contact details and payment terms. For key suppliers, you can also keep track of their product catalog and prices.

Accessible supplier records will make it easier for everyone in your business to select a supplier, reducing the PO creation time. This is especially useful in the scenario that a supplier runs out of the products you need. Your staff can quickly select another supplier to ensure you get enough stock to sell in time.

Have PO approval process

Implementing a purchase order approval process prevents financial and inventory mismanagements. This process ensures you don’t have duplicate orders and extra stock you don’t need.

Maintain purchase order documentation

Retailers should keep all PO documents for later audits.

You may want to keep the documents related to one purchase together, so your warehouse managers can bring up information and get the complete story. You can also conduct audits and regular quality control to ensure all PO details are correct and up to date.

And there’s one more thing you can do to make your process even more efficient.

One of the best ways to improve the PO process is to invest in a retail management solution that helps you manage all purchasing activities from one place.

A centralized purchase order software gives your staff easy access to all purchase order information. The solution will also update the purchase order status in real time across your system, reducing manual work and errors.

By connecting your purchasing to inventory and finance operations, you’ll get a complete picture of your product and spending.

If you’re a Magento merchant looking for a purchasing solution, you can get started with a free consultation with our experts. Together we can build a solution that fits your requirements and get you more savings and value from your investment.

Besides cash, there are many different kinds of payment options that you can provide for your customers. We just pick the 3 most popular payment methods that your retail is probably using or might be using in the future. These most used payment options are:

• Credit/Debit cards
• E-wallets
• Loyalty payments

Credit/Debit cards

Almost 80% of today’s consumers prefer credit card payment over cash. Not only can your business apply this payment on the eCommerce store, but you can also integrate with POS terminals to let customers swipe their cards at the offline checkout. The payment information will be recorded into your POS system for further tracking or reporting purposes.

Besides, when a customer sees a business displaying payment credit card logos like ATM, Visa, MasterCard,…, they tend to feel a certain sense of trust for your business.

Virtual wallets

Virtual wallets have become one of the most important forms of money transfer mechanisms. The way money transfers from virtual wallets is so seamless that lets you and also customers save a lot of time and energy. These wallets are emerging in every corner of the world, from small markets to big malls, from petrol pumps to most Government operated offices. 

Thanks to e-wallets, transferring money becomes instant and hassle-free using the most secure technology to prevent your money at the risk of theft. Customers just need to carry their phone with any virtual wallet app and then scan the QR codes at your store to proceed with the payment.

Loyalty payments

Merchants can benefit from a payment-based loyalty program such as points, cashback, vouchers, and gift cards, and targeted offers that can be applied in combination or independently. It brings a more personalized loyalty experience to your customers and increases sales gradually.

To apply these rewards to both online and offline stores, you need to create your own personalized omnichannel loyalty program through a centralized platform. It should be seamlessly integrated into your existing payment processes, giving you access to transaction and customer loyalty data in real-time.

After you get multiple payment options at your store, it always comes down to ‘mix’ those payments to fulfill a variety of customer requests.

Let’s take one example.

Regular customers come to your store and run out of cash to pay for the orders. They want to pay by credit card plus the remaining points in the customer loyalty account balance. If your store accepts both credit cards and loyalty points separately, it’d be easier for the customers to check out by both payment methods in one order.

This situation happens all the time. The more payment options you provide, the more payment mixes you need to include in your system. Let’s dig out into some popular split payments and how it works:

Combine credit cards and points in one order

Many retail stores or big brands accept this type of payment mix to bring flexibility toward the customer experience. Customers can enjoy more savings while merchants process more sales. You can apply it to your business workflow on the website or at the point of sale. Both channels must run in sync with each other by having one centralized system to manage customer accounts.

On the website, the business needs to design a workflow in which customers can:

• sign in their account
• create orders
• checkout with both credit card numbers and redeem points

Combine credit cards and points in one order

Many retail stores or big brands accept this type of payment mix to bring flexibility toward the customer experience. Customers can enjoy more savings while merchants process more sales. You can apply it to your business workflow on the website or at the point of sale. Both channels must run in sync with each other by having one centralized system to manage customer accounts.

On the website, the business needs to design a workflow in which customers can:

• sign in their account
• create orders
• checkout with both credit card numbers and redeem points

At your offline store, the staff needs to use the POS to find customer information and their accounts. Then the staff continues to swipe the card and redeem points to complete the transaction.

Combine cash and points in one order

This payment mix can only happen at physical stores. Similar to the credit card and points payment mix, staff can take money from the customer, enter the cash amount into the POS system, while asking the customer info to redeem the points.

One important note, your POS system needs to have options to enter a cash amount at the checkout. With that, you can check the order payment later and run reports precisely.

Nowadays, many POS systems in the market can make this process work out for you. Besides, some other payment mixes can work the same, such as cash and credit cards, cash and gift cards, etc.

Merchants need to observe how the customers are paying for orders. Also, don’t forget to update new payment technology or new payment providers as they can release new options at any time. That way, you will know the most suitable payment methods you should provide for your customers to dominate the local or international market.

Providing single or multiple payment options cannot come true if you don’t have a suitable system to back you up. Hopefully, you can get some ideas from what we’ve shared in this article and start researching the system that fits with your business.

If you’re a Magento merchant looking to add more payment methods into your business, you can book a free consultation with our retail experts to save time. We’ll work together to build a tailor-made payment solution for your business.