Watch: Welcome to the Age of Multinode Fulfillment

Multinode fulfillment is a natural outgrowth of the trend toward omnichannel retailing. David Glick, chief technology officer with Flexe, explains the term and its benefits to retailers and brands.

Multinode fulfillment makes it easier for distributors to fulfill consumer demand across a broader area. Over the years, some retailers have attempted to serve the entire country from one or two big regional distribution centers, a strategy that keeps costs down in the warehouse, but is more expensive on the transportation end. Moving to multiple nodes “allows them to service the customer faster and cheaper,” says Glick.

It was Amazon.com that woke up many traditional retailers, with its vast network of DCs across the country and ability to fulfill orders in just one or two days. (Or even hours, in some cases.) “That’s an expensive proposition,” says Glick, “but not as much as it used to be. As you put inventory closer to the customer, it shortens the last mile.” The more traditional approach requires packages to pass through multiple shipping zones, and in some cases be put on a plane to get them to the customer overnight.

Some retailers have had success with treating their physical stores as distribution nodes, while others have struggled with the concept. Glick says Target ships 73% of its online orders from stores, utilizing large backrooms to store and ship items. But those with less space must grapple with inefficient pick paths, some of which were deliberately designed that way to force shoppers to cover more square footage and therefore be exposed to a greater amount of product. Then there’s the possibility of shoppers onsite vying with store staff trying to fill online orders.

One solution is to create micro-fulfillment centers in stores, segregated by floor stock. In the event, retailers can improve inventory accuracy and set up shorter pick paths, Glick says.

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• Source: https://www.supplychainbrain.com/articles/36301-watch-welcome-to-the-age-of-multinode-fulfillment