Photo: Dick’s Sporting Goods
How fast can stores fill curbside pickup orders?
During the first quarter, over 90 percent of Dick’s Sporting Goods’ curbside orders were ready within 15 minutes, according to the company. Upon checking in at the store, half were delivered to the customer’s car in under 2.5 minutes.
Such metrics may be collected by many retailers, but Dick’s has apparently made curbside speed a priority.
“We continue to expect curbside pickup will remain a meaningful piece of our omnichannel offering as our athletes [customers] turned to this service for speed and convenience,” said Lauren Hobart, Dick’s CEO on the company’s first-quarter conference call.
Dick’s website indicates curbside/in-store pickup is typically ready within one hour of placing the order. Customers are notified by email or text when orders are ready.
Among other retailers, Walgreens promises orders are ready “in as little as 30 minutes.”
Other retailers promoting a one-hour window include Apple, Best Buy, Kohl’s, Nordstrom and Staples. Gap and Macy’s promise to have orders ready within two hours. Whole Foods offers pickup in as little as an hour for Amazon Prime members. Walmart’s pickup orders are available within four hours; Target says select stores may take up to six hours.
Home Depot’s in-store pickup page states, “Most orders are ready within a few hours, however, please allow for extra processing time on items requiring assembly or large orders. Due to current events and high volume, orders may be delayed.”
CVS’s website indicates orders will be ready “within 24 hours.” Several chains, including Lowe’s, Foot Locker and Gamestop, refrain from making promises about turnaround time.
Curbside/in-store pickup is expected to remain in high demand by customers after being quickly adopted during the pandemic. At Best Buy, 44 percent of online orders in the first quarter were picked up in store, similar to last year’s first quarter when stores were closed for half of the period.
Retailers with lengthier pickup turnaround promises may be balancing other in-store needs, including assisting in-store customers or filling online delivery orders. Increased BOPIS/curbside pickup is expected by many chains to bolster online profitability as related investments scale.
Dick’s Ms. Hobart, commenting on e-commerce profitability, told analysts, “The more BOPIS and curbside, the better.”
- Dick’s Sporting Goods Inc (DKS) Q1 2021 Earnings Call Transcript – The Motley Fool
- Dick’s Sporting Goods In-Store Pickup – Dick’s Sporting Goods
- Pickup Today| Free pickup at store – Walmart
- Order Pickup – Target
- Pick Up In Store – The Home Depot
- Call ahead for FREE pickup at select CVS stores. – CVS
- Best Buy (BBY) Q1 2022 Earnings Call Transcript – The Motley Fool
Discussion Questions
DISCUSSION QUESTIONS: What expectations for turnaround times on curbside/in-store pickup should retailers set for in-store workers and customers? What are the biggest internal challenges for stores looking to make quick turnaround deadlines?
Poll
BrainTrust
The competitive landscape shapes consumers’ expectations for service levels and with some retailers promising one-hour processing of in-store/curbside pickup, that is the current bar. The biggest challenge to fulfilling online orders in the store is staffing. High volume retailers will need to have dedicated staff for the role of picking, packing and delivering (curbside) orders.
Always faster. No matter what. While curbside and in-store pickup will undoubtedly remain permanent and expanding fixtures in retailing, how this plays out in the long run (i.e. post-pandemic), will be interesting to see. Customer service is an arms race of faster is better and so, to this extent, retailers will always be trying to deliver faster. However as the pandemic subsides and demand for these services moderates, retailers will need to make cost decisions about how to best use their resources. The key for retailers is to set appropriate expectations and then deliver as promised.
At a minimum, customers are looking for same-day pick-up in stores and this could be the differentiator for a retailer in making the sale vs. the customer ordering from Amazon with a guaranteed delivery date of the next day (without the customer leaving their home).
Getting in a car and making your way to a store requires effort and if a customer is looking for same-day, then the retailer needs to find a way to get product to the customer with speed and could trigger additional sales.
Stores that are not looking to deliver to the customer quickly will lose because the customer has more options than ever. Speed is the differentiator.
Dick’s BOPIS metrics are impressive. And I can certainly understand why different retailers need different windows based on the complexity of their own logistics. But retailers cannot allow speed to work against accuracy. The aggravation from one bad BOPIS experience could be a relationship killer.
Technology, technology, technology. Accurate inventory management, back room locator systems, wireless communication between employees, and finally, finding the exact right spot for the pickups.
This is going to be a bigger challenge in malls than it is in strip centers, but the question of where is almost as big as how.
My gut tells me that stores should do anything they can to ensure pickups are ready within two hours, and that the pickup process is extremely easy and timely. Store pickups of any kind – whether inside or at the curb – are one of the most effective weapons we have against Amazon. As such, I feel like we need to exploit this opportunity any way we can, even at the risk of reducing margins a bit to account for the staff required for curbside deliveries. In a shocking twist of fate, I firmly believe the store is the future!
Consumer expectations are set by the leading retailers – keep an eye on ALL major retailers to stay competitive and use leading technology solutions. However always stay within your logistical bandwidth because setting an unrealistic bar and failing is worse than having a longer wait time. In lieu of BOPIS, offer sub-one hour home delivery micro-fulfillment solutions with the likes Jokr, Bond, Ohi, etc.
California still hasn’t fully opened and New York just opened May 19 so touting the first quarter to me doesn’t show demand for these services. I still don’t get when so many stores are running in a way where half to one-third of staff priority is given to BOPIS. Yes you might otherwise lose those who want nothing to do with going into a store but are they the most profitable? Malls are jammed. A breakout of cost versus upside should measure resources going forward.
Bob is on the right track — demand is not yet clear for many retailers, and getting customers in the store remains a key marketing goal, last I heard.
Speed with accuracy is the magic formula. As soon as accuracy drops because of speed, we’ll see a trend to move more slowly but not disappointing the customer. Systems can help to achieve that accuracy, and then it will be about maintaining accurate on-hand inventory and adequate staffing. There is no silver bullet here.
Customers always want their orders quickly but that poses challenges for retailers based on ensuring that staffing is available to fulfill the orders and the costs involved in prioritizing curbside/in-store pickup. Retailers need to identify target turnaround times based on the desired balance of meeting customer expectations and incurring additional costs.
During the pandemic, many retailers were rigging curbside/pick-up just to keep up with retailers that were already in the game. Those stores are now catching up, building curbside facilities, acquiring the right technology to run it, and scheduling properly to serve the increase in that type of traffic. This definitely is the new normal, and if stores have not yet perfected the curbside/pick-up they need to get moving – NOW.
There is a big difference between Dick’s where the number of items per transaction is maybe two versus a grocer at 15+. This cuts straight to the question about micro-fulfillment centers (MFCs). If a retailer uses MFCs to speed up picking and distribution, then what? They also need to finish the order and match the window given to the customer. This is especially crucial in grocery, where frozen, refrigerated, and mixed orders can’t be left waiting for customer pickup. Customer expectations? Shorter and shorter times between “want” and “have.” The phrase “instant gratification” has become a reality. And drones are just over the horizon, too.
Speed is life, no question about that. But in this situation, accuracy is just as important in my option. Accuracy meaning if it takes you an hour or two to fill an order, but you can commit to the customer that they will receive their order immediately upon arriving at the store, and that it will be complete, or at least that you managed expectations for what’s might be missing — that’s really critical to managing the customer experience.
Based on my experience, the expectations right now are under two hours but there are retailers doing it consistently in one hour. The challenge is managing the in-store customer demands while trying to fulfill these orders efficiently. Some customers can talk in-store for some time and require more attention while at the same time the clock is ticking on the curbside order. It can be stressful for the in-store associates.
The biggest challenges for consistent success in quick turnarounds are data, technology, and training. I have seen many situations where there may be only one item in inventory but it is a demo item that all customers may not want. The retailer has to decide whether the display item can be sold or not and how it should be reflected in the inventory. This is data governance and establishing rules. Also, retailers can have short staff on a particular day due to no-shows or sickness so most everyone should be trained on how to pick an order so there is flexibility in who can do the picking. Lastly, technology is key. Handheld devices must be readily available to complete the order on the fly and provide all of the paperwork in the proper workflow will help the team meet the curbside timing requirements.
Let the curbside Olympics begin! The customer will always dictate how much time it should take, so ask them at each pick-up point. How fast can curbside pick-up be? Go to your local Amazon grocery and watch for the pickers. One warning, don’t get in their way; they move at a high rate of speed! They’re probably the retailer who is setting a standard of customer expectation on curbside delivery. And they’re off…
Ready in 15 minutes with a less than three minutes wait time… As a customer, I’d buy into that every day. Curbside pickup is a convenience. Its popularity accelerated through the pandemic, and as we are heading into the post-pandemic era, customers that enjoyed the service will continue to do so. The biggest challenge retailers will have is consistency. It can’t be two minutes of waiting one day and ten minutes the next. The internal system or process has to be perfected.
Setting a higher expectation at one hour and making orders available for pick up within 15 minutes sounds great. However, to meet that expectation on a consistent basis cost-effectively requires investments in automation technologies and redefining roles and incentive structures of the store employees.
QSR magazine publishes a list of the fastest drive-thru times every year. Which, over the years, has caused a race to master that operational challenge at every level, AND gives QSRs something to brag about. Perhaps someone like Retail Week, WWD or Forbes should do an annual study of the top 50 at curbside and see who’s doing it best? You know, a public service to move the whole process along. That way, retailers wouldn’t have to waste their precious narrow margins on ads for something that could be an effective subscription tool and useful public knowledge. Just a suggestion.
Curbside is going to all but die despite people finding it to be a delightful new experience during the height of the pandemic. For those that choose to continue using it, anything beyond a five-minute turnaround once on location negates the option.
In-store pickup turnaround is very specific to the vertical and time of day/day of week. For example, peak hours at a grocery store can really cause a strain on BOPIS and lengthen turn-around versus off-peak.
From my first-hand experience, some retailers don’t take these options as seriously as their hype leads one to believe, leaving it to individual store managers to succeed or fail without good corporate oversight. Two examples:
Whole Foods (orders placed through Amazon) and to a similar degree Wegmans (orders placed via Instacart) both often have very poor inventory management/forecasting. Between the time an order is placed and it is picked, there are many out-of-stocks, leaving gaping holes in orders. It’s not a supply chain thing, it’s very lackluster store-level inventory management.
Home Depot: curbside has been hit or miss. The worst was at one of their better locations when after a half-hour after checking in and waiting, I went into the store to see where my order was (as did others). The service desk associate was very nonchalant in telling me that the person in charge of curbside must have gone home without telling anyone. I can easily list a few more firsthand Home Depot curbside failures here as well. And BOPIS returns have been unimaginable fiascos multiple times, requiring corporate intervention.
So it seems that some retailers get it and understand user-centered design thinking and others tick a box for marketing perception.
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.
While logic dictates not trying to promise anything faster than you can deliver well on, the expectation by the shopper is going to drive the fulfillment time down with the comparison to Amazon and relevant competitors. So buckle up and prepare for more speed in fulfillment moving forward!
Most retailers will need technology investments and major process improvements to meet these kind of commitments. Target and Best Buy have led the way here.
The rest? It will be interesting to see which providers emerge as the standard.
There are actually two sets of timings for customers when it comes to curbside — the availability after a product is ordered (post order) and the availability once the customer arrives at the store for the pickup (post arrival).
Post order timing is variable enough to set to a longer time clock, especially to meet logistical demands. However, competition is stiff and anything more than 24 hrs will be a real issue with large swaths of customers. In today’s market of same day delivery, a rapid turnaround here will be helpful — but won’t be the end of the world for retailers. Customers have high rates of pickup later and in some cases not at all, where the product needs to be restocked.
Post arrival pickup times should be less than the time it takes to find the product and go through a checkout line. This is the convenience customers are seeking and, missing this timeline would drive customers to think, “I should’ve just gone inside and picked it up.”
Challenges will be mostly on in-store BOPIS processes, employee availability and training, and how the retailer manages stock and availability — especially for high demand items. One big risk is stock outs at the store. Cross-order to DCs and SCs and fast ship to store will be a challenge for many retailers to make a 24 hr timeframe.
Speed is an obvious advantage as no one wants to wait, but exceeding expectations is even more important. Put the processes in place to consistently deliver in 10 minutes or less and promise 15. That’s when customers will start singing your praises. If you can’t do it that fast, then, as with CVS, make a delivery time promise you know you can keep and always beat it. But understand that shoppers shop for delivery time just as they do price. Pay more but get it in an hour versus next day … many will choose to pay more. Store operations, take a bow.