Background

The client had recently implemented omnichannel fulfillment capabilities including ship from store, ship to store and buy online pickup in store. The goal was to better utilize enterprise inventory and improve merchandise sell through.

Approach

Summit Advisory Team’s (SAT) unique Phase Zero methodology was invoked to help the client identify the root causes of current state issues, highlight gaps in processes, system configurations and technical data flows and identify paths forward to improve and scale their solution and prioritize a path forward across business process, change management & technology.

Challenges

Order cancellations and bounce rate was very high.
Monthly parcel costs were very high and increasing month over month.
Customer sentiment and satisfaction scores were very low & customer complaints were high..
Inventory records presented online were not accurate to actual physical store stock.

Outcomes & Actions

• SAT identified several issues that were driving cancellations & bounce were identified including –
  • Issues with inventory data: allocation system not seeing omni sales, issues with inventory sync timing & issues with inventory file sent to the website.
  • Issues with conflicting inventory exposure & order sourcing rules particularly with store capacity settings and expedited order sourcing rules.
• SAT also identified several issues with operational SLAs, order handling in-store & shipping methods.
• After corrections, the customer subsequently achieved significant financial improvements including
  • Improved fill rate (78 -> 96% driving +$10m annual revenue) & reduced bounce rate from 3.5 -> 1.4
  • Reduced costs – from 1.6 units/parcel to 2.0 ($750k annual savings) & $10 to $7.50 cost per unit SFS
  • Improved CSAT and customer delivery SLA from 60 -> 85% delivered within 5 days