Brick-and-mortar stores are feeling the heat from online retailers that combine a seemingly limitless array of inventory with fast, free shipping. Under that pressure, a number of retail chains, among them industry stalwarts like Macy's, J.C. Penney, Sears, and Kmart, have shuttered dozens of locations nationwide.
But traditional retailers are hardly giving up the fight. In response to the threat, they're rethinking how they use their stores. In particular, they're looking for ways to turn what is often a vast network of physical retail outlets to their advantage. For many, the answer has been to expand their store-based fulfillment activities—in other words, to leverage those stores for the swift fulfillment of online orders. (Because retail outlets may be located closer to the customer than DCs are, store fulfillment can mean shorter order-to-delivery times.)
As fulfillment activity migrates to stores, it's probably no surprise that the tools used in the DC to support fulfillment are making their way over as well. Take voice technology, for example. Long popular in the warehouse and DC for directing tasks like order selection, voice systems have a solid record of boosting productivity and accuracy. That's largely because they enable workers to receive instructions via headsets, rather than looking at a screen, which frees up their eyes and hands to select items or perform other warehouse tasks.
So, many retailers have asked, Why not translate that tested method to the brick-and-mortar shop, where store associates could leverage the technology to stock shelves, look up prices, and assist customers? Visit a Staples office supply store, a Best Buy consumer electronics outlet, or a Kroger's grocery store, and you might see employees walking the floor with headsets.VOICE HITS THE RETAIL FLOOR
Those headsets will likely become even more commonplace as stores get increasingly involved in order fulfillment. Voice can be a useful tool for stores that are starting to adopt some of the functions of warehouses, said Scott Powell, product management leader at Honeywell Voice Solutions, which markets voice-directed picking systems through its Vocollect brand.
"As the retail industry continues to be impacted by e-commerce, we're seeing stores become DCs to some degree," Powell said. For instance, many retailers have begun to merge their storefront and online operations by offering "click-and-mortar" services like buy online/deliver from store (click and deliver), buy online/pick up in store (click and collect), and curbside delivery.
As retail outlets take on those fulfillment tasks, voice can help in three ways, Powell said. To begin with, the technology enables employees to optimize their efficiency. Second, it helps standardize the level of service provided. And finally, it helps assure tasks are executed well regardless of which worker is on that shift.
Voice-directed work tools translate well from the warehouse to the retail floor when employees are performing repetitive yet detail-oriented jobs like order selection, inventory counts, stocking shelves, or updating prices. However, when you bring customer service into the mix, it can have some drawbacks. For instance, some retailers cite concerns that a worker's bulky headset will discourage shoppers from asking questions or seeking help, which could ultimately result in a lost sale.
One workaround is to choose sleek, lightweight headsets instead of ruggedized warehouse versions, Powell said. Another option is to pick a model with a microphone boom that, when lowered, pauses the voice direction so the associate can engage with a customer.FINDING ORDER IN RETAIL CHAOS
Despite that potential, users should not expect to simply migrate voice-picking hardware from their DC to the store and instantly achieve DC-level results, experts caution. That's largely because retail work tends to be more chaotic than operations in the well-ordered warehouse.
"There are many best practices developed in the DC that can be applied to the store, but not all of them can," said Gary Oldham, vice president of sales at the Vitech Business Group, a voice-directed picking technology vendor. For example, while warehouse shelves are typically labeled with information like zone, section, and bin numbers to help workers locate items quickly, retail shelves lack that type of identifying information. That difference can affect a worker's ability to rapidly locate a product he or she needs to pick, Oldham said.
As users roll out the first retail voice pilots, many companies are discovering that they may have to use the technology differently on the retail floor than they do inside a warehouse, agreed Sean Wallingford, senior director of strategic operations at systems integrator Intelligrated Systems Inc.
The nature of the work in a retail environment means employees are often assigned to a wide variety of tasks—in a single day, they could clean floors, stock shelves, and receive products off a truck—while a warehouse worker usually concentrates on a single specialized job from sunup to sundown, he said.
"In the DC, everything is tracked and measured, then compared to an engineered standard for the number of people needed for the job," Wallingford said. "But stores have no idea how long it will take. They'll pull people off cash registers because a shipment of hot orders came in, and then customers see 20 registers with only one lane open because there are three people out back picking," he said.FINDING A NICHE FOR VOICE
With all those distractions, voice technology probably won't be a good fit for every corner of the retail store, but retailers are testing a raft of approaches to find the ones that work best.
One such approach is to deploy voice technology only in certain physical segments of the brick-and-mortar store, like the stockroom. This has a couple of advantages. First, it insulates employees from the distractions of having to field queries about prices, discounts, inventory location, sizes, or returns. Second, it assures that shoppers won't be deterred by the technology from seeking the help they need.
Using voice in the stockroom instead of the display floor is an effective way to address concerns that the technology will create a virtual wall between employees and shoppers, said Frank Rossi, manager for North American business development at systems integrator Dematic Corp. Other solutions include picking inventory from shelves at slow times instead of peak periods, or simply having employees wear a button that reads "Have a question? Ask me."
Enhancements to technology are also helping to ease those concerns, since voice-recognition technology has improved greatly since voice-based tools first entered the DC, and the proliferation of voice-operated consumer devices has led to greater familiarity with the gear. "The public is getting more accepting if they walk into a retail store and see an associate wearing a headset, especially in direct-to-consumer or grocery sectors," Rossi said.
As for other applications for voice, some retailers are leveraging voice tools to accelerate the training and onboarding of workers, said Sean Elliott, vice president of corporate technology at HighJump Software Inc., which sells voice-directed picking technology through its Vitech unit.
Many companies are intrigued by the prospect of treating their store inventory as a small, forward-deployed DC, Elliott said. But achieving that goal means they have to retrain retail associates who are more accustomed to folding jeans and dressing mannequins than matching products with shipping slips. Voice systems, which are known for their user-friendliness, can be a good method for teaching store clerks new skills.MORE ADVANCES TO COME
As competition from e-commerce players intensifies, so will the pressure on traditional retailers to match—or even exceed—their rivals' service levels. For some, that will mean stepping up their game where store-based fulfillment capabilities are concerned. In many cases, they'll look inside their own organizations for inspiration, analyzing their warehouse and DC operations for ideas they can leverage on the brick-and-mortar side, experts say.
"Stores are simply inventory points all around the country, and you have to leverage that value of having a physical footprint close to your customers," Intelligrated's Wallingford said. "So they're saying 'We've got tried-and-true solutions in the DC; let's see if we can apply them to retail.'"