Retailers are adding more products to build a larger assortment of product offerings. How are they doing this? They are not building bigger stores. Instead they are adding new products to their web stores and revamping what is sold in stores to stay close to their customers’ needs.
Amazon, a major driver of competitive retail trends and whose aim is to “sell everything to everyone,” sells over 200 million products. Other retailers are responding.
- Home Depot is expanding its depth and breadth of products and now has 600,000 items available from its online store. A typical Home Depot store stocks about 35,000 items.
- A Walmart supercenter has about 150,000 different products. But online, Walmart offers over 5 million items.
- Sears says they have 30 million products available from their web store.
- Target announced in October the addition of 35,000 new items and free shipping for the holiday season.
What This Means For Your Small Business
Online shelf space is virtually unlimited. However, retailers have to please their particular kinds of customers. Be ready to show buyers the niche you serve and how it relates to the demographics of the retailer’s customers. Show a willingness to work with potential retailers in trial marketing with a limited number of stores or to start exclusively with their web store.
You do not have to get into physical stores to expand your distribution. Starting with a retailer’s online store can prove your product has an audience and earn the opportunity for shelf space in stores later. Or you may have a viable market that is entirely online.
Your new retail partners may stock your product in stores or they may ask you to ship straight to consumers, or they may want your business to do both. Be ready to support EDI drop shipments to individual consumers with branded packing slips.
Contact us anytime to find out more about how we can assist your small business.
Retailers face several key omnichannel challenges that affect suppliers. Retailers are in a very competitive race to give consumers the products they want in a seamless online to in-store or in-store to online experience.
Any channel the consumer chooses must be executed with fast delivery whether that means pickup in the store, or shipment from the distribution center or shipment direct from the supplier.
Omnichannel expectations are becoming pervasive and the tipping point has been reached. Last year about 37% of adults shopped both online and in stores. This year the expectation is that over 50% will do so.
The challenges that retailers face have a ripple effect that impacts suppliers.
Leading retailers are aggressively investing in new fulfillment centers to support rapidly rising omnichannel sales and ship orders directly to consumers.
Amazon added four new fulfillment centers in the month of October. Amazon now has a total of 44 such centers in North America.
Home Depot opened two direct fulfillment centers in Georgia and California earlier this year and has plans for another one next year. The centers are focused exclusively on shipping online orders. The home improvement chain estimates that the new centers will support delivery time of 48 hours to over 90% of the zip codes in the U.S. This year, Home Depot is also piloting buy online and delivery to store for its customers.
Last week we looked at the overall forecast for holiday sales. This week we will examine omnichannel sales trends for the holiday season. Omnichannel shoppers tend to spend more that others and expect to find what they want, where they want it, and when they want it. Research surveys are showing significant trends:
- The National Retail Federation predicts online sales growth of 8% to 11% in November and December.
- PwC’s most recent retail survey found that two thirds of consumers consider themselves to be omnichannel shoppers. They use a combination of mobile phones, tablets, PC’s and physical stores to research and then buy.
- According to ORC International, 67% of shoppers consider the internet site of a retailer to be important to their buying process. In the future, a little more than half, 51%, plan to spend more using the internet channel than in brick-and-mortar stores.
It is already time to start talking about holiday sales. A Google survey found that 20% of consumers began their shopping before Labor Day.
What is going to happen this holiday season? All of the sources I checked have estimates that are above the 2.9% average increase for the last 10 years.
The results will have an impact. Retail sales drive the U.S. economy. According to the National Retail Federation, 1 out 4 jobs are retail related . That’s 42 million jobs. Retail impacts $2.6 trillion of annual GDP. A large portion, 25% to 30%, of sales for the year are made in November and December.
Holiday gift spending should be up by about 8% according to a Prosper Insights & Analytics survey. About half of shoppers, 53%, plan to spend the same this year as last year. Those that say they will spend more tend to be higher-income consumers.
Shop.org forecasts a jump this year over last year of 8 to 11%. The National Retail Federation predicts a more conservative rise of 4.1%.
You may have heard horror stories about EDI. EDI is indeed a technology with many layers of complexity. Choosing the right EDI provider can insulate you from the complexities. Thousands of clients have found that CovalentWorks makes EDI as Easy as email®.
Here are some of the headaches we take care of:
- Every trading partner has different specifications. No two are alike. Each trading partner’s specifications have to be mapped to business documents and tested. Mapping is further complicated because trading partners do not all use the same version of EDI and they do not all use the same transaction types.
- Every trading partner has different testing procedures. Some will send a test order to begin the process while others will wait for a live order. Some have an informal process with one analyst, others have a strict procedure and several people involved. Still others have a web site for testing.
See my blog post from July 8th for more details on the challenges of implementing EDI transactions with trading partners.
Knowledgeable support specific to each trading partner is required after implementation is completed. You can read more about what makes for good EDI support in my post last week.
EDI does not have be difficult. CovalentWorks provides complete EDI solution delivered from the cloud.
EDI software is accessed via the web. Software installation is not needed. All you need is internet access. Implementation, testing, maintenance and support with any trading partner are all included.
Contact us anytime to find out more about how we can handle the headaches of EDI for your small business.
EDI technology has many layers. Some have even called it a monstrosity of technical complexity. Good EDI support takes care of the complicated technical layers so that users get the assistance they need, when they need it.
Good EDI support:
- Provides complete answers to questions in terminology users can understand. “One and done” answers should be the norm.
- Has online help for common questions and trading partner specific requirements. It also has training videos that are available whenever needed.
- Includes a support organization that has transparent systems so that anyone in the support group knows the latest on a given client’s status and needs. It eliminates the need to wait on one person in the group to answer a client’s questions.
Last week’s blog entry reviewed why your customers require you send them Advance Ship Notices (ASN’s). This week we will look at how to make the production of ASN’s faster for your company.
We have two services to speed up ASN’s, MyB2B and B2BWorks.
MyB2B is a web-based EDI service that handles all of your customer’s EDI transaction types including ASN’s. EDI software and everything needed for a complete solution is accessed from the cloud. The web forms for ASN’s have been designed for ease of use and for speeding up the ASN process. Features include:
- ASN’s are designed specifically for ease of use with every customer’s individual requirements. Over 1,600 trading partner customers of our clients have been implemented.
- Data entry time is reduced by data from purchase orders being automatically filled in for you on the ASN. Fields that are not on purchase orders but which are always the same can be set up to be auto-filled.
Most major retailers and many industrial customers require Advance Ship Notices (ASN’s). Today’s post will cover a brief overview of ASN’s and then cover the substantial benefits of ASN’s for your customers and consequently why they require them.
An Advance Ship Notice (ASN) tells your customer in advance that your shipment is on the way and it tells them how your cartons are packed. It is an ANSI X-12 EDI 856 transaction type. The EDIFACT equivalent is the DESADV (Dispatch Advice) message.
The ASN is basically an electronic packing slip with some of the Bill of Lading information added to it. The ASN is usually sent to your customer when your goods leave your loading dock so that your customer receives the ASN well before they receive your goods.
Each carton has a unique GS1-128 bar code label on the outside of the carton. The bar code number is also in the ASN so that the customer’s receiving dock personnel can scan the label and reference the ASN you sent. You can see a video about ASN’s here ASN video
Pay On Receipt speeds up payment to suppliers by eliminating the invoicing step. Here is how it usually works:
- The customer sends an EDI purchase order to the supplier.
- The supplier sends an EDI Advance Ship Notice and ships the goods to the customer in cartons with bar code labels that correspond to the Advance Ship Notice. The Advance Ship Notice is basically an electronic packing slip.
- The customer receives the goods at their loading dock, performs the appropriate checking process, and permits the Advance Ship Notice information from the supplier to automatically update their systems for operations and payment. The check process may be a verification that all products match the Advance Ship Notice or there may only be periodic audits of some shipments.