4 Omnichannel Upgrades Every Apparel Retailer Should Consider

apparel retail omnichannel fulfillment

The days of online and offline channel rivalry are long in the rearview mirror. 

Today, 80% of consumers make their retail purchase decisions online, yet brick-and-mortar stores account for approximately 70% of total sales. It’s clear that the former competitors have become increasingly complementary to each other. While online platforms offer unmatched convenience, offline channels now play a vital role in fostering consumer engagement, strengthening brand presence and facilitating order pickups. 

When integrated, the two channels form a powerful retail ecosystem that caters to diverse consumer preferences and needs. Customers can enjoy the ease of shopping online as well as the immersive experiences and personal touch that offline channels provide. Embracing this omnichannel relationship allows retailers to optimize their reach and build a comprehensive strategy that leverages the strengths of both online and offline channels. 

In 2022, fashion executives cited artificial intelligence, automation and omnichannel customer experience as some of the top capability gaps in their organizations. Ahead, we break down four omnichannel upgrades that can help apparel retailers address those gaps while boosting operational excellence, building brand loyalty and driving profitable growth across all channels.

1. Dynamic inventory allocation for increased flexibility and availability

Whether a result of pandemic-related overstock or conservative consumer spending, stores are sitting on a whopping $732 billion of fashion retail merchandise. Dynamic inventory allocation is one way to address this costly surplus before items begin to go out of style. This strategy assigns common stock across channels in real time. Instead of statically allocating a fixed quantity of inventory to specific locations, dynamic inventory allocation involves continuously adjusting the allocation of goods to different locations or channels to optimize resource utilization, reduce stockouts and improve overall supply chain efficiency. Through data analysis, demand forecasting and intelligent automation, retailers can make informed decisions about where and how much inventory should be allocated at any given time to meet customer demand while minimizing excess inventory.

RELATED READ: The Customer Comes Second: Building a Foundation of Intelligent Inventory Management

2. Seamless customer order fulfillment across channels

The majority of apparel retailers are laser-focused on improving the customer experience, yet many are still lagging in omnichannel fulfillment options. Those without Buy Online Ship to Store (BOSS) and Buy Online Pick up in Store (BOPIS) options are practically inviting their customers to abandon their carts for faster, more convenient shopping experiences.

Through a seamless order fulfillment process and options to shop through various channels interchangeably, a well-integrated system leads to increased customer convenience and fosters repeat purchases.

3. Efficient returns management to build customer trust and loyalty

According to the National Retail Federation (NRF), the average return rate of clothing in the U.S. apparel market sits at 20.8%, and rates have risen by more than 50% since 2020. 

Consumer expectations for free and easy returns are not dwindling anytime soon. What can dwindle, however, are the costs and headaches associated with returns. By optimizing reverse logistics to offer hassle-free options, retailers can turn returns into a strategic advantage. 

In the warehouse, a streamlined returns process requires an automated and efficient dock-to-stock or cross-dock system. This enhances restocking processes, prioritizes exchanges and resales of returned products, and simplifies picking and labor requirements. 

In-store return options are often quite convenient for customers. When inventory management and visibility are seamless across channels, it can reduce the time and cost to return an item to stock. The key is to establish a returns process that is easy across all channels, so retailers can efficiently restock or re-induct returned items into inventory for resale, and reduce return-related costs.

Automating the returns management process not only creates a trustworthy experience for customers but can also reduce 3-4 days of holding returns inventory to 3-4 hours.

Automating the returns management process not only creates a trustworthy experience for customers but can also reduce 3-4 days of holding returns inventory to 3-4 hours.

RELATED READ: Returns are getting out of hand. Could fulfillment orchestration be the solution?

4. Intelligent multi-agent orchestration for faster, more accurate omnichannel fulfillment

As smart warehousing continues to evolve, many retailers will see a need for a real-time integration and optimization layer, which Gartner refers to as multi-agent orchestration. With this capability, they can choose best-in-breed robots from multiple vendors and connect, coordinate and continuously optimize the omnichannel fulfillment actions of each agent for the best possible workflow. In the context of omnichannel fulfillment, orchestration involves integrating disparate systems such as WMS, TMS, robotic agents and other automation equipment under a single platform so that they work together seamlessly. An orchestration platform models and executes various automation and human processes to ensure that items are picked, packed and shipped for enhanced operational efficiency and improved overall performance.

RELATED RESOURCE: Gartner analyst Dwight Klappich explains multi-agent orchestration

In today’s retail landscape, the distinction between online and offline channels has blurred, with omnichannel fulfillment taking center stage. While 80% of consumers decide on their retail purchases online, physical stores contribute to 70% of total sales, emphasizing their complementary roles. Building an effective omnichannel approach empowers apparel retailers to stay competitive in the digital age, build brand loyalty, and drive growth by maximizing sales opportunities and adapting to emerging technology trends.

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