Network of online-sales distribution centres to better survive

Network of online-sales distribution centres to better survive

In the U.S. there is a distribution war going on in retailing and there is one clear winner online-only seller Amazon thanks to his efficient group of warehouses within short distance of most major city population, now department store group Macy’s is moving in the same direction

So far, goods were dispatched at Macy’s from online warehouses and this will change in the future by sending the goods from shipping centres at its store locations. It is planned that around 292 of its 800 stores will execute the new service to customers and with enlarged storerooms.

There is of course also a back thought, if a store has too much of an item in stock, the store will put it on the website to sell it off but at regular price and not with discounts. On the other hand sold out items will still appear on the website as long as they can be found nationwide in a physical store and the order will be placed with the store nearest to the customer. This procedures save time and money on shipping. And sales grow without the need to carry higher inventories.

Nordstrom was the first department store chain to this system, it started already back in 2009 and ships now from all of its 117 full line stores. This was followed by Toy’s R in all of its 800 sales points and Babies R US stores. But admittedly it is not like at Amazon where the process is totally automated, in department stores it takes more time and labour to achieve the same goal. And of course there is also the question to be answered, which part of the company will be credited for the sale? Is it online business, the store? Anyhow, It is not always the one who performs the store-warehouse job! It really depends on how the company is organised, Macy’s declares they are struggling with compensation across the company being a multichannel retailer.

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