Inside Best Buy's Distribution Innovations For Online Order Fulfillment
MINNEAPOLIS (WCCO) -- Online shopping keeps growing. Researchers estimate we'll spend $135 billion this holiday season online. That has impacted how major retailers do business, big time.
Best Buy's revenue from online shopping was $3 billion in 2014; this year, it will more than double that with an expected $6.45 billion.
Promises like next day delivery, free standard shipping and tools to enhance your online shopping experience all require some changes to keep.
"How do you offer these more convenient options which inevitably are more expensive, to give your customer that choice, the control, the convenience they want?," Rob Bass, the chief supply chain officer at Best Buy, said.
According to Bass, the stuff that happens behind the scenes makes customer expectations possible. One big thing Best Buy recently added was automation. You click purchase, your distribution center gets your order, a robot retrieves the item and sends it on its way. It's a lot more efficient, and less taxing, than the old fashioned way.
"To do that part of the automation, a typical team member at Best Buy would walk seven miles a day. Literally walking up and down aisles, up and down stairs to grab one or two at a time for those segregated orders," Bass said.
Another dilemma they've addressed are excessive cardboard boxes. Best Buy has three metro e-commerce centers around the country, using technology that does things differently. When your order's processed, a scanner takes a 3D image. It cuts cardboard to the exact size it needs to get a perfect fit, which means a little bit of wiggle room and a protective lip. The item goes on top of the cardboard, which folds over, then sealed and on its way.
"Ultimately then allowing us to put more of these on the trucks. If you can do that you actually put less trucks on the road, less airplanes in the air," Bass said.