Many are familiar with the concept of pop-up retail, most likely because the concept has been around since the 1990’s, but as of lately, a very similar idea has found its way to into the supply chain of many retail establishments, that is- pop-up fulfillment otherwise known as pop-up distribution. Before we get into the benefits, let’s take a brief look at the process.
What is pop-up fulfillment?
Pop-up fulfillment is the act of setting up a distribution center at a specific location for a brief period of time to distribute or fulfill a temporary demand for certain goods. This demand is one that is well-above the usual levels and is most likely to take place during the holiday season. A breakdown of the whole process can be seen by clicking on the infographic to the side or by clicking here.
4 Major Benefits of Pop-Up Fulfillment
- Can be properly set-up within few days
Once a location for the pop-up distribution center has been chosen, it takes just a few days to set up an account and ship out the right inventory to be stocked.
- Provides flexible expansion of fulfillment capabilities
Pop-up fulfillment centers provide an effective means of fulfilling order volumes that might not be supported by the retailer’s current facility. They are also flexible in terms of selecting a warehouse location and a specific fulfillment period. This allows retailers to test out the concept.
- Overall expenses for warehousing during off-seasons is minimized
Since pop-up fulfillment centers usually last for around 3 months, this allows retailers to save on warehousing and other costs associated with stocking larger inventory levels during off-peak periods.
- Gives merchant time to analyze processes and adjust accordingly
Since the task of fulfilling additional orders during the peak season is outsourced to the pop-up fulfillment center, the merchant has the time to analyze and implement any changes in their distribution network. It also allows them to focus on other aspects such as their current marketing campaigns and customer service.
Some of the success metrics involved with the pop-up fulfillment process would be looking at the amount of inventory remaining at the end of the peak season- the lesser the better and also the average shipping cost per order using pop-up fulfillment versus the regular warehouses. A successful run usually entails that a majority of the orders made were truly the same high volume SKUs as predicted and that their deliveries were made at both an efficient and cost-effective rate.