Even before the COVID-19 pandemic, Lowe’s had noted an uptick in the number of consumers purchasing online and then picking up the items in its stores. But the virus pushed people to be even more active in seeking options that would enable them to obtain the products they needed without requiring much (or any!) interaction with strangers. Therefore, Lowe’s has sped up its novel distribution plans, aiming to get a strategic change into place faster and more extensively than it previously predicted.
This option relies on high-tech lockers, installed in some stores already and slated to be in all of them by March 2021. When consumers place orders online, it prompts in-store employees to pick the ordered items. They get installed in a locker than can be opened only with a scan of a barcode, which the system generates and send to customers via email once their order is ready. Thus for the purchasers, the items are easily and readily available, but for others, with potentially thieving or nefarious designs, they are well protected and inaccessible.
In addition to minimizing interactions with other people in the stores, the lockers eliminate the need to touch keypads or screens to complete the purchase, which represents another benefit in the coronavirus era. Reflecting these benefits, Lowe’s has reported that customers in test stores indicated their great satisfaction with the lockers and intentions to keep using them for future purchases.
The home improvement retailer is not just limiting its distribution efforts to in-store experiments though. About a year ago, it announced plans for a new direct fulfillment center in California, slated to open soon, which will join an existing center in Tennessee. Once operational, these two fulfillment centers will allow Lowe’s to guarantee two-day delivery to nearly all its U.S. customers. In support of its efficient delivery efforts, the company also has announced future expansions and additions to its bulk distribution centers, ecommerce fulfillment warehouses, and cross-dock delivery terminals.
That is, across the supply chain, Lowe’s is working to increase its capabilities and the variety of tools it uses, to get products to customers where and when they want them.
Discussion Questions:
- Are lockers a significant improvement over other in-store pickup options? What benefits do they offer, and are they worth the investment in building them?
- What other distribution considerations does Lowe’s need to address to be able to continue supporting customers’ online buying, in-store pickup preferences?
Source: George Anderson, “Will Lockers Help Lowe’s Pick Up More Sales?” Retail Wire, September 23, 2020