Home Delivery World - Scaling Click and Collect Beyond the Store

Scaling Click and Collect Beyond the StoreAndy Lockhart

Why online grocery?

� Food and Beverage market was worth $700 Billion in 2016 according to the US Department of Commerce (The single largest consumer sector in the US)

� Smallest share of the digital retail sales today

� Potential growth is huge

Source: BI Intelligence

The Growth of online grocery

� Online will be 20% of the market by 2025

� Equivalent to 3,844 grocery stores

� Retailers with a solid Omnichannel presence will retain customers and gain traffic

� Most retailers do not have a clear strategy

� How to integrate brick and mortar with digital

� Ability to meet the customer where they are is key

� Convenience, assortment and personalization will determine the winners

Why consumers shop online?

� Choice

� Convenience

� Time

� Saves money

� Retailers have to adapt to customers’ increasing preference for online grocery shopping

Source: Brick meets Click

There are still hurdles

� Biggest barrier to buying grocery online is customer desire to pick their own fruits, vegetables and meat

Source: Brick meets Click

How do you get your groceries?

� Pickup at the store

� Pickup at a remote location

� Home delivery

Can Grocery be Omnichannel?

� Meeting the customer where they want to receive their groceries

� Can retailers truly deliver Omnichannel from a store based pick model?

� Availability, accuracy, efficiency and service will be key

Customer

Shop in Store

Collect at Store

Remote Pickup

Home Delivery

Fulfillment of Grocery Orders

� Pick grocery orders in existing brick and mortar stores – click and collect

� Use existing infrastructure

� Faster time to market

� Customers come to the store

� Use dedicated fulfillment facilities

� Higher capital investment

� Accurate stock management

� Gain efficiency and improve customer service levels

The Challenges for the Store

� Challenges for picking in store for online grocery

� Picking Accuracy

� Out of Stocks

� Store Crowding

� Substitution Process

� Requires a dedicated storage space for picked orders

� Active/Passive Cooling

Dedicated fulfillment centers

� Dedicated fulfillment centers address the challenges of in store picking while providing click and collect

� Stock Control

� Accuracy

� Customer Satisfaction

� Allows multiple delivery options to suit the customer

� Home Delivery

� Remote Pickup

� Store PickupClick and Collect

Scalable Fulfillment Centers

Manual Pick

Semi Automated

Fully Automated

Customer Pickup Options

� Dedicated fulfillment allows the Grocer to deliver online orders to the consumer where they want to receive them

Grocery Fulfillment Center

Pickup at Store

Remote Pickup

Deliver to Home

Summary

� Solutions to improve e-commerce scalability and reach customers

� Dedicated Fulfillment Centers

� Improve efficiency for retailers

� Improve customer satisfaction for in-store shoppers

� Reduce losses due to out of stock and poor substitutions

� Remote Customer Pickup/Store Pickup/Delivery

� Allows retailers to meet the customer where they want to receive there groceries

� Remote pickup points provide better scalability

� Automated pickup reduces the labor requirements for pickup

Andy Lockhart

Vice President Sales, TGW Systems, Inc

Andy.lockhart@tgw-group.com

Thank You