If big box department stores have the extra space and the coveted foot traffic, it makes sense for beauty retailers/brands to set up shop (within a shop). This is not that much different from setting up shop in a mall, except the store is integrated into an existing space and not standalone as it would be in a mall.
The percentage of online orders a retailer should fulfill from a store will depend on a number of factors, which include proximity of the store to customers, the size of the store, store sales (non e-comm) and the replenishment cycle. Fulfilling from stores is a great way to reduce last mile costs and speed up delivery, but not at the expense of store sales. If a store has great sales per square feet (again, non e-comm), using inventory from that store to fulfill online orders may cannibalize store sales -- which are higher margin because no shipping is involved.
An alternative could be to open a micro-fulfillment center (i.e. an extra stock room) adjacent to the store to fulfill online orders.
Hyperlocal fulfillment/micro-fulfillment--whatever you want to call it--requires striking a balance between meeting both physical and digital shoppers' expectations.
This is the best of both worlds: In-person shopping to experience the product first-hand with the convenience of online shopping/delivery. It takes a lot of the effort out of shopping for large/bulky items (no more asking for favors from friends/family members with vans). Of course, the real purpose of this is to get shoppers to download the app so Sam's can track their shopping behavior and tailor promotions. etc. If as a shopper you're cool with that, go for it!
I'm not sure a ghost kitchen will drive traffic to the mall as consumers have now become used to home food delivery -- trekking to a mall just to sit in a food court seems like a stretch. The more likely scenario would be more opportunity for ghost kitchens as they would no longer need to rely solely on digital promotion and be able to take advantage of mall foot traffic.
Retailers like Lego need to make their stores a destination if they want to compete with private label knock-offs and the likes of Amazon and Walmart who can ship their products same-day/next-day for free. The more shoppers that buy playsets directly from Lego stores, the more margin Lego can hold on to. That in addition to additional impulse purchases and generational brand building.
A time guarantee around curbside/in-store pick-up is another part of the ever-growing omnichannel package that can make or break a sale. For example, companies like Target, Walmart, Office Depot, Best Buy and Staples may be competing for the same customer with similar or identical products. If the prices/products are the same and the stores are a similar distance from each other, but at one retailer I can swing by in an hour, wait a couple minutes in the lot, have someone load the trunk and I'm on my way -- the other retailers will need some major differentiation to get me to wait an extra two to five hours.
Retailers like Home Depot and Costco have the capital and clout to dictate shipping terms (or get their own ships!) but for mid-market retailers, this just isn't an option. Air freight is a margin killer, so use sparingly (if there's capacity of course). This leaves importers/brands/retailers with few options except diversify the base of manufacturing, order early, explore expedited sea freight options, shop around at different forwarders to see who has capacity and order more up front to anticipate future bottlenecks.
Let's not forget that the reason why real estate prices are low is because of the over-expansion of retail stores in the first place. So I would caution any retailer to expand without understanding the ROI for each additional location. That said, omnichannel is about the seamless integration of physical and digital. Just because an online presence exists or is enhanced, that doesn't mean that brick and mortar should be minimized. It's about striking the right balance of optimizing service to current customers, while being visible and accessible to new and potential customers, both online and in-person.
Offering a fast turnaround for BOPIS/BOPAC should be seen as a competitive advantage -- something that will drive customers to your store vs. a competitor's due to the speed and convenience you're able to offer. I say the quicker the better. The challenge comes in the way of available capacity. Not enough staff and you don't meet SLAs. Too much staff and overheads are high. There will be a learning curve where retailers will need to test and see the optimal staffing levels for any given day and hour of the day. From a technology perspective, big box and department stores should also look at technology to expedite the picking of items from store shelves or the stock room. Micro-fulfillment (without the automation) aka "store-as-warehouse" systems would direct associates to the item location, much like a WMS system does in a DC. For large stores with many SKUs, these systems would reduce the time spent picking or retrieving products off the shelves, helping to meet SLAs.
If it is more sustainable to convert diesel to electrical, and sustainability is part of the retailer's brand story, it will be difficult not to do so. But they shouldn't stop at their truck fleet--owning their last-mile delivery with an electric vehicle fleet should be looked at as well.
Whatever moves they make, be it in grocery or pharmacy, they need to be differentiated from what already exists in the market, otherwise why bother being a "me too" pharmacy? The way to differentiate is to expand upon their existing model. Make life easier for existing customers: place your prescription order online or though Alexa. Pick up your packages at the same time as your pills. Bring your returns to the pharmacy when you pick up your pills. It needs to be an extension of Amazon.com.
Petco has a strong advantage over Amazon thanks to its network of stores that are being used as micro-fulfillment centers. Petco's fulfillment and shipping costs are lower than Amazon's due to their their proximity to the customer which also accelerates order delivery time. Add BOPIS/BOPAC into the equation and Petco's formula will be hard to beat by DTCs.
To attract the best people to work in their stores, the market is indicating that retailers will need to increase their wages and benefits. For retailers with deep pockets, this won't be an issue. For others, it could be the difference between being profitable, breaking even or losing money. It seems the writing is on the wall for where wages are going, which means retailers on the margins will need to find ways to stay competitive. This means looking for savings in sourcing, supply chains, rent, tech, etc. and increasing foot traffic, conversion rates and sales per square foot.
Could be a record year for retail as businesses begin to reopen and customers are ready to get out and shop. This could also be the peak for the likes of Target and Walmart as specialty retailers who were not given special status should start taking market share back from them. Next year if life is back to pre-pandemic habits, retail could see some decreases as customers opt to spend their disposable income on experiences such as restaurants, hotels, concerts, car trips, flights, etc.