The upcoming e-commerce trend: ordering groceries online (Source: Rewe)
Delivery vs. Click & Collect
For many people, having to go to the supermarket to buy pizza or pasta for dinner after a hard day at work is an unappealing idea. Of course, things can now be done differently, as buying groceries online is already a given in many places. While England and France are shining with high growth rates, other European countries are still in the starting blocks. This also includes – still – Germany, where buying food online is still a marginal phenomenon despite high growth figures. However, this can change quickly, as many grocery retailers are now relying on online shop solutions to meet the e-commerce competition that is emerging.
The customer rewards these efforts. According to studies, over 60 percent of consumers find it practical to buy everyday items online. In addition to a user-friendly website and competitive prices, smoothly running intralogistical processes are among the central success factors for a functioning online grocery store. But what about the delivery of the goods?
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Transporting food by truck doesn't just have advantages
In this country, retailers such as Rewe or Edeka prefer to transport goods by truck. This has the advantage for the customer that they can have their ordered products delivered directly to their home and save themselves the trip to the supermarket. However, at the same time he is confronted with one of the main problems in e-commerce shipping: accepting the delivery, for which the recipient must be at home if he has not provided an alternative address. But in contrast to normal parcels, a supermarket shipment cannot be so easily dropped off at the kiosk around the corner, as there is most likely no possibility of temporarily storing temperature-sensitive items such as dairy products or even frozen food. To avoid this, it is essential for retailers and consumers to have the most exact delivery date possible. This in turn causes higher logistical effort for the sender, which is added to the transport costs that are already incurred. Here it is primarily expenses for personnel (drivers) and vehicles (trucks, gasoline) that make calculations more difficult for the dealer. Because one thing is certain: if the transport surcharge on the online order is too high, the customer will abandon the order. Given the low margins in the German food trade, this is a dilemma that retailers are facing. At the same time, this is also a reason why grocery e-commerce has not yet become established and why a big player like Amazon has not yet taken off with its Fresh delivery service
However, there is an alternative that at least partially relieves retailers and consumers of transport costs and delivery problems: Click & Collect - online ordering and later collection in the store based on the model of the classic drive-in system.
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Drive-in – the alternative?
The principle of the drive-in is simple and comparable to the concept known from burger chains: Orders are placed online, picked up by car at a pre-selected station, where the (refrigerated) bag is simply handed over to the driver without having to he even has to enter the store.
These food drive-ins are a system that is finding more and more users. In France, over 2,000 drive-in supermarkets already offer their groceries online, which are then picked up by buyers on site. The US supermarket chain Walmart and is significantly expanding its Click & Collect service in 2016 (initially only in the USA).
The ready-picked boxes are then temporarily stored until the customer picks up the goods. Since an order usually consists of products of different quality and durability, special requirements are placed on their storage. It must be ensured that the option of refrigerated or even deep-freeze storage is available for individual items.
Depending on the ceiling height of the warehouse, the storage equipment used, some of which is air-conditioned, can be either horizontal carousel storage or vertical carousel racking. Depending on your needs and space, shelf shelves can be combined.
The intralogistics processes of the drive-in supermarket are controlled using warehouse management software. Once the software receives an order, the orders are routed to the various storage zones. In zones with automated storage devices, the food is retrieved and received by staff at the service opening according to the goods-to-person principle, where it is packed into the order container. In order to avoid picking errors or repetitions, the picking is confirmed by the employees using a barcode scanner. By using batch picking and/or multi-user picking tools, order processing can be further accelerated.
Once an order has been processed, the products are temporarily stored in a box/bag, with temperature-sensitive items being stored in a cooling area or storage device with an integrated air conditioning function. As soon as the customer drives up to the supermarket in his car, he only has to read a receipt code at one of the two parking bays installed scanner stations, after which the goods are removed from the interim storage by an employee and brought to the car. After the shopping has been stowed away, the customer can drive off with their purchases without leaving the car.
Conclusion
If the drive-in station is on or near their natural route home, the system means that the customer hardly loses any time during the process. And in contrast to delivery by driver, which cannot be precisely calculated, he can decide for himself when he will pick up the goods. The success of such a system certainly depends on the widespread distribution of drive-in stations, as customers would not have to take long detours for this offer. However, the success in France shows what potential lies in the concept.
In addition to (one-off) investments in the interim storage facility and the drive-in solution on site, the retailer also has to pay wages for those employed in the transfer of goods. This eliminates the costs of the logistical infrastructure for transporting the goods to the customer. In the end, the individual calculation of the retailer and customer will decide which solution they consider to be more advantageous.
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