It’s the beginning of August and already I’ve been inundated with back-to-school advertisements. I suppose this is better than the Christmas ads that will plague us following Labor Day, but still, it just seems a bit early for me. My son doesn’t go back to school for another 5 weeks. But retailers are all in for creating buzz around their back-to-school offers. The National Retail Federation (NRF) expects back-to-school shopping to hit $26.6 billion in 2014, with nearly $8.5 billion spent on electronics. Check out NRF’s cool infographic here to see some more mind boggling back-to-school numbers. I’m just hoping to get in a few more trips to the beach while it’s still officially summer.
And now on to this week’s news:
- More UK spots turn into pickup points for online orders
- Royal Mail introduces ‘click and collect’ service for small businesses
- Wal-Mart Canada fuels rise in free shipping
- Rising e-commerce tide spurs warehouse development in N.J.
- Amazon launches 3-D printing store
Buy online, pick up in-store is getting a facelift in the UK. A number of companies are turning local shops, car parks, airports, and gas stations into pick up places for online orders. Waitrose, in partnership with logistics company ByBox, will set up refrigerated lockers from this autumn in Gatwick’s two terminals, enabling travelers to pick up their groceries on the way home. Having just returned from a vacation, this is certainly a perk that I could get used to. But the big push behind the influx of pick up locations is the holiday shopping season. The hope is to give shoppers more and more options to have their online orders fulfilled around the holidays, which will help alleviate the problems associated with last year’s delivery nightmare.
On a similar note, the Royal Mail has begun phasing in a new ‘click and collect’ service to 20,000 small and medium sized businesses as it moves to capitalize on its parcel business. Customers will be able to collect packages directly from any of 10,500 Post Office branches nationwide. As Amazon continues to evolve its delivery network, retailers are looking for new ways to reach their customers quickly and efficiently. With the “click and collect” model already well established in the UK, this move simply makes sense for the Royal Mail and small and medium sized businesses.
In Canada, the push is not towards more pick up locations, but towards free shipping. Last year, Wal-Mart Canada introduced free shipping on all purchases. This is a deviation from the norm, where shipping is either free based on spend thresholds or for loyalty members. In a country as large and sparsely populated as Canada, free shipping has not been a logistical possibility, especially for smaller retailers. But Wal-Mart’s introduction of free shipping on all orders has changed the retail landscape, and an all-out war has been declared. Amazon has responded by offering unlimited free shipping for six months to students in Canada through its Amazon Prime Program. After that, students pay half price for the annual service, which is regularly $79.99 in Canada. It will be interesting to see how this all plays out, and what the effect on prices and profitability will be.
In the US, New Jersey is becoming a launching pad for the online fulfillment boom. From Jersey City to Trenton, 12 warehouses and distribution centers are under construction, amounting to 5.17 million square feet of new industrial space entering the New Jersey market. All but two of the properties are speculative. As the e-commerce market continues to grow, more businesses are looking for distribution facilities to meet their e-commerce needs. In the last year alone, there has been a flurry of lease activity in New Jersey, with Amazon opening a one-million-square-foot distribution center in Robbinsville, Peapod opening a 345,000-square-foot distribution center in Jersey City, and Williams-Sonoma leasing a 750,000-square-foot distribution center in South Brunswick. The state’s proximity to New York and area ports has been crucial to the growth. According to Thomas F. Monahan, a senior vice president at CBRE, a commercial real estate brokerage firm, “New Jersey has always benefited through thick and thin by one thing and one thing only, and that’s location. And that will never change.”
And speaking of Amazon, the company launched its 3D printing store this week. The 3D printing store offers shoppers over 200 products, including toys, jewelry and home decorations. The items are produced via 3-D printer, and can be customized by size, color, material or with personal text and images. A widget allows shoppers to play around with the design and preview the end result before they buy it.
“The introduction of our 3-D Printed Products store suggests the beginnings of a shift in online retail – that manufacturing can be more nimble to provide an immersive customer experience,” Petra Schindler-Carter, Amazon’s director for marketplace sales, said in a statement.
That’s all for this week. Enjoy the weekend and the song of the week, The Clash’s Should I Stay or Should I Go?