What is retail?

Retail: Individual customer requirements call for high-performance logistics

As consumers, we are all used to searching for products in a very specific way and transferring our expectations to the retailer accordingly. A major impetus for this development, which began almost two decades ago, was the e-commerce segment. Thanks to digital linking, we are able to demand exactly what we need, regardless of time and location - the variety of products is increasing accordingly, especially in the food sector and stationary retail.

proLogistik explains the term "retail" and shows you, in the context of intralogistics, what changes this inevitably entails.

Definition: Retail as a generic term for retail trade

The English term "retail" classically stands for the retail trade; the customer in this context is the end consumer. Depending on the context, however, "retail" is also understood in a differentiated way, for example in the real estate sector as a designation for real estate intended for retail. When it comes to fashion or textiles, logistics even has its own special field: retail logistics.

What this includes? We will show you:

  • Labeling of goods ready for sale including price labels, packaging material, etc.
  • Picking for the respective point of sale (POS)
  • Storage independent of the warehousing system
  • Quality assurance as part of the fulfillment service process
  • Assembly according to customer specifications

In short, retail encompasses all processes and tasks that need to be controlled and aligned in the course of the logistics of retail goods. By using modern technologies as well as digital control systems, it is thus possible to generate competitive advantages based on efficient outsourcing.

Retail and intralogistics: How exactly do they fit together?

A classic retailer, i.e. a retailer in the original sense, is particularly successful if it satisfies the needs of the customer. However, these are continuously increasing, not least due to global networking, which makes the management of the underlying logistics processes correspondingly more difficult.

Retail or retail logistics can often also be described as store or retail logistics, which is where most of the overlaps can be found. The aim of all this is to make the products intended for the end consumer available in a timely manner and exactly where they are needed: at the point of sale (POS).

An example from e-commerce illustrates the practical significance of this:

  • Consumers are increasingly buying via online retail, at the same time demanding fast delivery times and delivery that suits their daily lives (time-of-day options, etc.).
  • An online store that wants to win over these customers and retain them in the long term must not only offer a comprehensive range of products - but also be able to procure merchandise optimally and deliver it without delay if possible.
  • Retail logistics is designed accordingly to digitally design the entire supply chain as well as the basic flow of goods and information. An important function here is data collection, processing and analysis. It lays the foundation for better forecasting, cost-efficient warehouse management, and an offer that addresses individual customer needs.

Value added services in the retail segment: the special extra for every retailer

As has already been made clear in the above paragraphs, the logistics requirements on the part of a retailer are significantly higher than usual. The better the flow of goods can be delegated and controlled, the less warehouse capacity is needed - and at the same time the amount of capital tied up in stock is reduced. One aspect that is particularly important in the context of retail and logistics is value-added services (VAS).

What is it about? This refers to so-called value-added services, some of which extend far beyond the typical scope of logistics services. Along the logistics chain, for example, it is a matter of assembly, repair or packaging, but often also of quality inspections or disassembly tasks (especially in the case of returns).

The close exchange between the retail company and the logistics service provider makes it possible to focus on the respective core business and, in the best case, to have goods delivered that are "ready for sale". Analogous to the above-mentioned value-added services, there are also process-oriented value-added services that include picking, labeling, packaging or the entire returns management.



Image: / Shutterstock

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