Upon examing the many effects of online ordering and in-store pick up, it becomes very clear…that nothing is clear except that it seems to be a solid business move and almost a necessity for a retailer who wants to stay in business and thrive.
Plenty of retailers – large and small – are seemingly having success with online ordering and in-store pick up.
They are realizing sales increases and, admittedly, additional costs…costs they are more than willing to incur to get this important business channel out of infancy in their organizations.
Many of the costs can be clearly linked to the movement of goods, the extra space required, the added inventory, etc.
But, there are other costs that are not so clearly linked to transactions or the business model itself.
For example, in-store management and staff morale.
Let’s look at some of the details that have to be considered and how they would affect store management and employees. Even though the effects would not necessarily be negative, they still need consideration.
Shooting oneself in the foot is never a good idea, right?
Now, some might say that having in-store pickup is the only way to ensure the ongoing financial health of the business and, therefore, store employees should be happy to make it all work out. That may be true. Every case is different.
Still, retailers need to think about things like:
Compensation – Including Commissions and Bonuses
Who gets credit for the original sale? Perhaps no one seeing as the customer purchased online. But, is that fair to the designated pick up store who will be very involved with the sale…inventory, labor, etc.
And what if the customer returns their purchase to the store and a store associate spends time with the customer presenting options with the intent of turning a return into an exchange and possibly increasing the amount of the transaction?
Who gets credit for the sale in that situation?
If the answer is that the store associate does not get any credit, then why would s/he spend time with the online customer?
Of course, the store associate should want to assist for the good of the company…but does it really make sense for them to spend their time on something they will not get credit for while another customer might need attention; one who plans to spend $$$ in-store?
Bear in mind that ‘get credit’ doesn’t have to mean commission or bonus (although we think it should). If the associate gets the credit it means that their sales record will show the sale or partial sale as theirs.
This is crucial when it comes time to judge the employee’s performance.
How can a performance evaluation be done without knowing the numbers? The employee’s results…in KPI’s… are an integral part of the performance evaluation and sales numbers are paramount to understanding their performance in almost every KPI.
If ‘getting credit for the sale’ means commissions and bonuses, then the retailer must give credit to the in-store employee who handles returns and exchanges.
Handling it any other way would be a quick way to lose good people. Only the retailer would know if that is important to them or not.
If not, it will soon be apparent to customers and that would mean a sad ending, even if not immediate.
More on this later in the week…
• Workload • Labor/Wage Cost • Returns • Inventory Allocation • Space Allocation • Who is in Charge and Who is Accountable?
DMSRetail 
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