Operating a retail business continues to become more complex. With the pandemic-inspired upswing in eCommerce and diverse order fulfillment processes in play, as well as labor shortages and supply chain challenges, automated retail technologies streamline and optimize operations, speed up eCommerce fulfillment and delivery, and reduce human error, among other advantages.
The Role of Automation in Retail
Automation technologies are not designed to eliminate the need for humans but rather to enable humans to focus on more valuable work by automating repetitive tasks and removing rote, transactional labor. In retail operations, automation is playing an important role across many different areas of businesses, including marketing, finance, order processing, order fulfillment, inventory management, fraud prevention, human resources, store management, and customer care.
Automation in the retail sector is leading the way in the digital transformation. It requires that data be connected to other data sources (in the cloud and on local servers) and that applications and systems be connected or integrated in real-time with each other. When data seamlessly flows everywhere it’s needed, common tasks or workflows can be automated. In other words, automation is designed to complete a series of tasks that ordinarily would require separate steps or actions by a human. It sets up workflows that, once triggered by an action (e.g., a customer clicks on “checkout” in her cart), prompt the entire sequence to happen automatically.
Benefits of Automated Retail Technologies
Automated systems enable retailers to streamline the customer experience across the entire retail ecosystem—from point of sale (POS) in-store and for online orders to fulfillment, delivery, returns, and customer support.
The primary benefits of automation in retail include:
- Modernizing customer experience. Customers expect a modern, connected shopping experience that delivers a true omnichannel buyer’s journey. Automation makes this possible by connecting back-end systems with front-end user interfaces to manage customer data and streamline processes such as order management, customer relationship management (CRM), and enterprise resource planning (ERP) systems with websites, apps, and POS systems — all of which lead to enhanced customer satisfaction.
- Lowering labor costs. Retail automation software reduces operational costs and labor costs by completing tasks such as order picking and packing in fulfillment centers and completing workflows faster and in fewer steps. Automation in customer care can include chatbots and virtual agents that perform routine actions for customers—including processing payments, reverse logistics, and responding to inquiries. They can also assist human agents to speed up and improve customer interactions.
- Improving efficiency. More streamlined workflows and processes can reduce wasted resources, cut down on time-consuming manual tasks, and improve efficiency across retail business processes.
- Increasing scalability. Artificial intelligence (AI) and machine learning (ML) technologies can perform complex tasks faster and at an exponential scale compared to employees. From being the front line of defense for eCommerce fraud protection to fulfilling larger volumes of orders at faster speeds, these technologies enable retailers to seamlessly scale and serve more customers—which is especially important during peak season.
- Enhancing risk management. Humans are prone to making errors, and factors like fatigue and distraction can increase mistakes, especially in the order fulfillment process. Automation completes the same workflow in the exact same way every time. While AI, ML, and robots are not infallible (they do make mistakes, which is how AI is trained to “learn” from mistakes), they significantly reduce errors and help mitigate risk across the business.
- Improving agility and resilience. Automation, when done well, enables retailers to be more agile and resilient in their ability to weather disruption and changes, including supply chain management and periods of growth.
Types of Automated Retail Processes
There are different types of automation in retail, but automated retail technologies for workflows/processes, analytics, order fulfillment, inventory management, and robotics are often the primary focuses. Retailers that deploy retail automation solutions into these areas of the business will be well-positioned to compete and deliver exceptional customer experiences.
- Workflow/process automation. Automating workflows and processes starts with data integration. Connected data can support application and system integration. With the support of an integration platform as a service to automate the integration process itself, it can enable retailers to easily connect software and platforms to create custom workflows that make sense for the business and the customer experience.
- Analytics automation. Retail technology generates massive amounts of data that contain important signals on customer preferences, intent, and behavior, as well as data on every connected touchpoint across the business (inventory, order fulfillment, logistics, shipping, reverse logistics, financials, etc.). This data is often siloed in various systems. By automating analytics and business intelligence, data can be automatically detected, sifted, sorted, and analyzed in real-time for information that should serve data-backed decision-making.
- Order fulfillment automation. Automating order fulfillment ensures that nothing gets missed in the process and that customers enjoy a streamlined experience from payment processing and order fulfillment to shipping, notifications, and reverse logistics processing. Automated retail technologies, such as a modern order management system, serve as a single platform with dashboards to keep everyone working from the same pane of glass. Integrations with key systems from third-party logistics companies, shippers, and sources make it easy to stay on top of the entire order management and fulfillment process.
- Inventory management automation. Tracking inventory has grown more complicated as retail stores are now serving as mini distribution centers, and multiple store fulfillment options such as buy online, pickup in-store(BOPIS), buy online, pickup curbside (BOPAC), and ship-to-store mean retailers need to source product from multiple locations while ensuring enough stock is available to store customers. A robust inventory management software will include real-time inventory visibility to monitor inventory levels as part of a holistic order fulfillment process.
- Robotic automation. Robots are changing order fulfillment in warehouses and distribution centers. A fleet of robots can automate the picking and packing process with increased speed, accuracy, and a never-in-need-of-rest workforce. From completing the entire order fulfillment process to using pick and pack services, robotic order fulfillment is fast becoming the norm for modern fulfillment centers. Additionally, autonomous vehicles are serving as delivery options in many urban areas to deliver packages to customers.
These different but connected types of automation in retail are part of what makes enterprise-level companies successful at optimizing their omnichannel operations. Regardless of the size of your company, digitizing your processes and deploying automated retail technologies will positively impact your productivity, efficiency, and customer experience while cutting costs and improving revenue and loyalty.
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