With six words, Urban Outfitters CIO Calvin Hollinger ushered in a new chapter in brick-and-mortar retailing: "We're out of the register business."
Using a combination of iPod Touch and iPad devices equipped to handle not just point-of-sale transactions but also returns, restocking and sophisticated save-the-sale applications, the retailer is ready to say farewell to traditional fixed registers in its stores. Urban Outfitters began deploying handheld devices running on a mobile POS solution from Starmount two years ago, and the retailer has continued to add functionality since then.
"Two or three weeks ago, we placed our very last register order," said Hollinger during an analyst day presentation last week. "Once we successfully make sure this iPad [POS] works in all the stores, all stores will be designed and equipped with iPod Touches and iPads."
Urban's customers and sales associates have responded positively to the mobile devices, but there are also practical financial reasons for the retailer's willingness to go totally mobile. The iPod Touch device, "fully loaded, fully installed, is about $500 and a register is about $5,000," noted Hollinger. The iPad tablet device, which can be mounted on a swivel arm at a cash wrap station, "is $1,000 fully installed."
Hollinger is particularly enthused about the mobile devices' out-of-stock application, which takes advantage of Urban's ability to access inventory from anywhere in its system. "If you come into a store and we don't have your color or your size, the sales associates can find a color or the size somewhere in the enterprise," he explained. The application displays the closest three stores that have the particular item the customer is seeking. "We can print out the closest three stores," or "we can check you out with two or three physical items and fulfill, from somewhere in the enterprise, another item, with one simple transaction. The stores love this," said Hollinger.
New $55M Fulfillment Center
In addition to revamping the store experience, Urban Outfitters is also enhancing its direct-to-consumer offerings. "We strategically believe that fast delivery is such a big deal that we invested $55 million to build a West Coast fulfillment center," in Reno, NV, said Hollinger. "Between the Reno facility and [the existing DC in Trenton, SC], we will be able to get to two-day delivery and less to over 80% of our customers. In fact, from this facility, we can get to one-day delivery to the seven Western states, including all of California, which is an important market for us."
Urban is also promising cross-channel improvements; by early 2013, "we will be deploying the ability to order online and pick up in store on the same day," said Hollinger. "Because again, we think it is critical that a customer gets the merchandise very quickly. And if we see there's a huge demand, that customers want to come in and pick up in the same day, we can begin with this capability that we have been exploring, providing same-day delivery services in certain metropolitan areas," he added.
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