Last Mile: Apple Joins Trend Toward Using Stores As Fulfillment Centers
The last mile is proving to be a competitive hotspot as the retail industry enters its critical fourth quarter. Using retail stores as distribution points has been tabbed an “Amazon killer” by some analysts and now Apple is joining that trend.
Target has been seen as the pioneer to use its network of retail stores as distribution centers for shipping products to consumers. With consumers and eCommerce companies concerned about shipping times during the holiday period, Apple reportedly will use its stores in a similar fashion. According to Bloomberg, the company was using regional warehouses in the U.S. to ship items. located customer’s region or directly from China. Now items that are in stock can be shipped directly from its network of almost 300 retail stores.
“Apple told staff the shift will mean faster delivery times for customers who live further from distribution centers than from stores, according to the people who asked not to be identified discussing internal policies,” said Bloomberg. “The products will be shipped through United Parcel Service Inc. in Canada and FedEx Corp. in the U.S. via ground shipping and may be delivered as early as the day after a customer’s order, Apple told its staff. The program will apply to customers who live within 100 miles from a store.”
According to Apple Insider, Apple tested the new distribution process at a handful of stores in June and July. More locations have been added in the intervening months, though not all outlets are taking part in the program. It points out that along with faster delivery, the move takes pressure off the company’s overseas supply chain.
“In addition, the program keeps Apple Stores operational during coronavirus lockdowns. Apple has discussed turning some stores into online support or sales call centers — as already seen at select locations — if and when they are required to shutter due to state or regional restrictions,” says Apple Insider.
The digital-first economy continues to stress the ability of companies to deliver goods in a timely fashion. With eCommerce expected to more than double last year’s levels, it also continues to affect other parts of the economy. According to the Bureau of Labor Statistics, the number of trucking jobs across the U.S. rose by 10,000 in August to 1.45 million. Around 8,000 courier and messenger jobs were also added in August, bringing the total to 923,000.
What Apple has also done is put more pressure on those shipping jobs and services. According to Karen Tyndall, director of customer solutions at GlobalTranz Inc., suppliers like Apple are making solid moves by using stores, but still need their delivery partners to come through, FreightWaves reported.
“Partnering with a third party provider that is adept in handling those challenges, making sure that the carriers understand this is what’s expected with each and every delivery, setting up compliance metrics, that ultimately scores these providers and ensures that to remain in the program, they have to meet different certain service levels and expectations or their cut from the program, it motivates them and ultimately ensures that the customers are getting a consistent level of service,” Tyndall said.