This is What it Takes to be an Omnichannel Retailer

From large big box chains to mom and pop stores, many retailers are improvising when it comes to omnichannel execution. Too often,  inventory systems aren’t fully integrated, and online orders filled by brick-and-mortar stores turn out to be a laborious process that isn’t as consumer friendly as it should be.

According to information found on OPEX, only 8% of retailers believe they’re adept at omnichannel practices, while just 12% believe they have suitable technology in place. More than 50% of retailers said their omnichannel approach is a work in progress, and 19% said it’s too much of a struggle. Overall, 75% of respondents indicated that they are dissatisfied with the execution and progress of their omnichannel efforts.

In this increasingly customer-centric world, retailers must recognize that omnichannel is no longer an option. In fact, consumers expect it!

“A successful omnichannel retail approach puts the customer at the center of the transaction and leverages technology to ensure a good purchasing experience that’s executed efficiently and cost-effectively.”

Source: OPEX

To make omnichannel work, retailers will need to invest in 4 primary areas:

1. Inventory

“Retailers need a complete and accurate view of their inventory,” says OPEX. That means they need to be able to keep track of their products from the moment they’re added to the company’s POS to the moment they’re sold.

“Without real-time, high quality, accurate data omnichannel retailing is impossible.” 

Source: Medium

A cloud-based inventory management solution that’s integrated with the retailer’s website is needed to ensure that data is available in real-time. This makes it easier to find and process orders, as well as forecast demand.

2. Automation 

“Technology that automates back-office processes like order fulfillment, carrier integrations, automated accounting and integrated purchase ordering can free retailers to focus more time on creating authentic omnichannel experiences across platforms,” suggests OPEX.

“Technology that was built for a previous age will need to be replaced. A new connected warehouse that speaks to stores and a website will need new fulfillment technology. An experience whereby a customer orders online but picks up in-store will require tracking and notification technology.”

Source: Medium:

Automated systems are typically faster and more accurate than manual labor, ensuring that back-end business processes are handled efficiently.

3. Shipping

For companies dealing with direct-to-consumer transactions, “last mile delivery” (the movement of goods from a transportation hub to the final delivery destination) is the most complex and expensive leg of the supply chain, claiming 30% to 40% of all transportation costs.

Unlike Amazon, most retailers end up passing the responsibility of payment on to their customers so they can at least break even if they’re unable to find ways to reduce cost-per-transaction.

“Making sure you choose the right carrier based on your needs and the customer needs is very important. You have to be able to depend on your carrier. You are one with them. The majority of the customers out there don’t distinguish between who makes errors. The carrier and merchant are the same for the customer. If something is not delivered, or delivered incorrectly, the blame usually falls on the merchant, when technically it could have been the carrier’s fault.”


Companies that handle their own deliveries, however, can invest in fleet management technology to improve route optimization and reduce operating costs. Alternatively, they can partner with third-party logistics specialists.

Of course, in-store pick-up can eliminate this problem altogether, and some retailers also use centralized drop-off points (or lockers), along with crowd-sourced delivery networks such as Amazon Flex.

4. Returns 

“Processing returns is labor and time intensive, however, with an omnichannel strategy, if not adequately addressed, returns can become a complex and difficult challenge to solve,” warns OPEX.

Back in the day, retailers kept online and in-store inventories separate, and returns were also managed separately. Today, stores must handle a jumble of returned goods that have potentially been purchased via a variety of channels.

While flexible return policies are important for the customer experience, they can pose challenges for retailers. That’s why integrated inventory management systems are crucial for handling in-house returns.

“One order management system, one database, one inventory. Without these you will never seem seamless to your customer.”

Source: RIS


As the National Retail Federation points out, retailers have a long way to go when it comes to omnichannel implementation. Most retailers have established digital, customer-facing solutions such as electronic product recommendations and cross-channel gift cards, but inventory-related strategies are seeing slow growth.

Currently, the online visibility of in-store inventory is only available with less than 20% of retailers, and notwithstanding the growing popularity of BOPIS (buy online pick-up in store), just 32% of retailers offer the service.

“An omnichannel strategy can help boost growth and increase customer loyalty,” says OPEX . “The data shows that those benefits will come at a very high price unless retailers first establish the inventory management and logistics infrastructure to support these strategies.”

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Sherene Funk is the author of the contemporary romance Autumn in Your Arms and two small business e-books. She is a voracious reader who owns more books than she can ever read in this lifetime. A graduate of Brigham Young University, she worked in advertising for many years before moving to her current writing position at Rain Retail Software. She researches non-stop to see what successful retailers do and loves to share what she learns with small business owners.