How to Empower Retailers by Utilizing Click & Collect in Omnichannel Strategy

This article was reviewed and updated on August 3rd, 2023

The size of the U.S. Click & Collect market is expected to surpass $154 billion by 2025.¹ The popularity of this feature is also growing in the e-commerce of other countries around the world. In this article, we examine the challenges associated with implementing Click & Collect. You will also discover the benefits that providing the option of placing online orders for quick in-store pickup offers both businesses and customers.

Click&Collect as a Key Factor in Customer Store Selection

With the ever-increasing number of people shopping online, expectations regarding shopping experiences are growing too. The choice of a specific store among a wide range of competitors is often influenced by the order delivery method.

Customers expect to receive their ordered goods free of additional charges and at lightning speed - preferably on the same day. In this context, it's unsurprising that nearly 67% of shoppers in the United States have used the Click & Collect service in the last six months alone. It is also estimated that by 2025, 10% of all sales will be fulfilled through Click & Collect² . In this way, they can minimize order fulfillment time and reduce delivery costs, frequently even down to zero.

Click & Collect as a Game-Changer for Business Growth

From a business perspective, introducing the Click & Collect service is an excellent way to reduce cart abandonment rates. The possibility of inspecting products on-site (with potential exchanges or returns) encourages customers to make online purchases and lowers the rate of complaints.

The availability of online stores 24/7, including holidays, offers convenience for consumers while simultaneously boosting sales for companies. Additionally, implementing fast pickup options (Click & Collect within an hour) leads to quicker order finalization and reduces warehousing costs. Adopting this sales model can also help minimize logistical expenses and enhance business attractiveness by improving accessibility.

Is Click & Collect the Recipe for Success for Every Retailer?

The introduction of the Click & Collect service may initially appear as a typical win-win situation, benefiting both customers and businesses. However, it's important to acknowledge that it is not a one-size-fits-all solution for all e-commerce challenges, and not every business will reap the rewards from this order fulfillment method.

Click & Collect works best for companies with established omnichannel presence and consistency across all sales channels. This ensures customers encounter the same product assortment and pricing, whether they shop in-store, on the website, mobile app, or social media. Centralized product data management is fundamental for implementing swift pickups.

Furthermore, the "order and collect" feature is most advantageous for businesses with an extensive distribution network. However, the locations of pickup points must be attractive enough for customers to compete with courier delivery options. Additionally, the industry in which a company operates plays a crucial role.

Offering payment-on-pickup can lead to unpaid orders and temporarily reserving stock in-store. While this may not be a major concern for a bookstore, it could pose limitations for a grocery store.

Implementing a new sales channel also entails adjustments to systems and the roles of employees in the organization. Adequate resources must be available for this process, and employees should be capable of handling additional responsibilities.

In conclusion, while Click & Collect holds great potential, its successful implementation requires careful consideration of a company's existing setup and industry-specific dynamics. Taking these factors into account will enable businesses to fully harness the advantages this order fulfillment method offers.

How to implement the Click & Collect service

Introducing a new sales channel is a significant organizational challenge and involves a series of modifications in the purchasing process. Among the major challenges is the logistical handling of such orders, which in turn requires modifications to IT systems and training staff to manage the new sales path.

1. Logistics - How to Source the Goods

A key challenge is deciding on sourcing goods required for fulfilling orders with fast pickup. Most retailers combining brick-and-mortar with online sales have one or more central warehouses responsible for distributing products to stores and customers.

In this model, online orders are delivered to the stores along with regular restocking, typically on a multi-day cycle. As a result, customers receive their packages in a timeframe similar to courier deliveries. Therefore, the only incentive that could convince them to opt for Click & Collect in this setup is free delivery.

Hence, the most consumer-oriented solution would be to create a decentralized warehousing system where each store functions as an independent warehouse. This would enable order fulfillment directly at the pickup point, reducing the entire process from several days to as little as one hour.

If, for various reasons, implementing such a system is not feasible, an alternative could be establishing central warehouses in major urban centers (similar to what eobuwie did). This way, customers from selected cities could collect their orders on the same day, which already offers a significant advantage compared to courier deliveries.

2. IT System - Where to Handle the Process

If we have the possibility to offer Click & Collect from retail stores, the most crucial decision to make is choosing the system to handle orders with fast pickup. Click & Collect service can be implemented by introducing a separate Warehouse Management System (WMS) in each store, expanding the functionality of the currently used Point of Sale (POS) system, or integrating it directly with e-commerce.

Implementing Click & Collect through a WMS (Warehouse Management System)

Opting for the implementation of multiple WMS systems transforms brick-and-mortar stores into a network of dispersed warehouses. While this may create challenges in management and inventory optimization, it also enhances future expansion opportunities. Additionally, it provides independence from deliveries from a central warehouse, which is particularly crucial in the current epidemiological situation. However, the downside of this solution is relatively high implementation costs.

Implementing Click & Collect through a POS (Point of Sale) System

The situation where one internal system handles all functionalities performed in both brick-and-mortar and online stores seems like an ideal solution. It would streamline staff workflows, enable quick access to real-time inventory information, and help maintain consistent pricing policies across all sales channels. However, in practice, POS systems are often inflexible and challenging to expand.

Implementation of Click & Collect in E-commerce

Adding the "Order and Collect" feature to e-commerce seems to be the easiest solution due to the high flexibility of online shopping platforms. It allows for a clear overview of the order within the same system the customer uses, without additional delays caused by integration.

However, such a solution involves introducing another application that store employees must use, which may lead to errors resulting from human factors. It is also essential to remember that by doing so, we are essentially shifting the entire process of handling fast pickups to a place that should typically serve different purposes.

3. Staff training

From the employees' perspective, the most convenient option would be to expand the currently used POS system, which they are already familiar with. However, adding the "Order and Collect" feature usually requires managing an additional application. Implementing the new sales process in an e-commerce or WMS system means some orders must be handled in a different system. This could increase the risk of errors, at least during the initial implementation phase.

Therefore, it is crucial to consider the employees' work mode and provide adequate training not only to store personnel and those directly involved in fulfilling fast pickup orders but also to, for instance, helpdesk staff. Ultimately, the success of the entire undertaking will be determined by customer experiences, which will be influenced by the entire shopping journey, including the service at the pickup location.