MINNEAPOLIS (WCCO) -- In five years, online shopping revenue has doubled for Twin Cities-based Best Buy, up from $3 billion in fiscal year 2014 to $6.45 billion in 2019. With it comes a change in how the retailer fulfills its orders, from sorting to shipping.
To meet consumer demands for the 2019 holiday season, Best Buy announced next-day delivery on thousands of items in store and online, free standard shipping, and new online resources to help improve the online shopping experience.
"The trick is, how do you offer these more convenient options—which inevitably are more expensive—to give your customer that choice, control, and convenience they want," said Chief Supply Chain Officer Rob Bass in an interview with WCCO. "It does take more money."
Automation is among the latest improvements. When customers click "buy" and a distribution center processes the order, a robot retrieves the item and sends it on its way. Bass described it as more efficient and less taxing than the previous model.
"To do that part of the automation, a typical team member at Best Buy would walk seven miles a day," Bass said. "Literally walking up and down aisles, up and down stairs, to grab one or two at a time for those segregated orders."
Excessive cardboard is another online shopping dilemma, for companies and consumers alike. Best Buy is one of a few companies investing in new technology, designed by an Italian company, CMC Machinery.
When an order is processed, a scanner takes a 3D image, then cuts cardboard to the exact size it needs to get a perfect fit. Bass demonstrated how it leaves a marginal amount of room around the product, and adds a cardboard lip to protect corners from falls.
The item goes on top of the custom layout, the cardboard folds over, the box is sealed, and it's sent on its way. Bass said while the consumer benefits with less waste, the company gets more space.
"To make a specific box for that exact item with no air pillows, no popcorn, no wasted corrugate, ultimately then [allows] us to put more of these on the trucks," Bass said. "If you can do that, you actually put less trucks on the road; less planes in the air."
He also said they are faster than the traditional boxing process.
The machines are at Best Buy's three Metro E-Commerce Centers nationwide—Chicago, Los Angeles, and New York.
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