Ship-from-Store in Omnichannel Retail: Case Studies and Key Insights (2024-2025)

Mar 25, 2025

Ship-from-store has become a cornerstone of omnichannel fulfillment, allowing retailers to use physical stores as mini distribution centers. Major retailers like Target, Walmart, and Best Buy have leaned into this strategy to speed up deliveries and cut costs. Below we explore recent case studies from these brands, industry data on costs and speed, evolving consumer expectations, and how technology (AI, automation, and order management systems) is optimizing store-based fulfillment. We’ll also cover best practices for staffing and logistics in stores, as well as common challenges retailers face and how they overcome them – all with the latest findings through 2024-2025.

Retailers Turning Stores into Fulfillment Hubs: Target, Walmart, Best Buy

Target – Stores Fulfill the Majority of Online Orders: Target has been a pioneer of ship-from-store. As of late 2023, over 80% of Target’s online orders are fulfilled from store inventory digitalcommerce360.com. This store-centric model lets Target leverage its 1,900+ store network for local fulfillment. Target’s CEO has noted that using stores as fulfillment hubs significantly lowered costs – earlier in their shift to this model, overall fulfillment costs dropped ~40%, and same-day fulfillment costs (order pickup, curbside, Shipt delivery) shrank by 90% supplychaindive.com. Target credits this strategy for enabling faster delivery options (like Drive Up curbside and Shipt) at scale. The main benefit is closer-to-customer inventory , which cuts shipping distance and time. However, Target has had to invest in training thousands of store employees as “omnichannel team members” to pick and pack orders. It hired 100,000+ seasonal workers in 2023 (many allocated to store fulfillment) to meet peak demand digitalcommerce360.com. Target’s success shows that with enough stores and a robust tech backend, a retailer can fulfill the bulk of online demand straight from local outlets – improving speed and keeping costs in check digitalcommerce360.com.

Walmart – Over Half of Online Orders from Stores: Walmart similarly uses its vast store footprint for fulfillment. In 2024 Walmart reported that more than half of its online orders are fulfilled from local stores walmartgolocal.com. Walmart has even branded its ship-from-store capabilities as part of its services to other retailers – highlighting that using stores as fulfillment nodes helps optimize inventory, improve cost efficiency, and speed up delivery walmartgolocal.com. A Walmart product director noted that ship-from-store allows the “right items to get to the right customers quickly and cost effectively” by tapping nearby store stockcommerce.walmart.com. For example, local store fulfillment can reduce delivery times to same-day or next-day for nearby customers, versus shipping from a distant warehouse. Walmart has invested in technology like Store Assist (available as an integration for Adobe Commerce users) that gives store associates a mobile workflow to pick, pack, and ship online orders from the store commerce.walmart.com. This ensures consistent, efficient in-store processes for online orders. Walmart’s approach also includes piloting micro-fulfillment centers (MFCs) – mini warehouses with robots (like its Alphabot system) inside or attached to stores to automate online order picking. These MFCs have enabled one-hour pickup and delivery fulfillment in tests, significantly boosting efficiency for grocery ordersgrocerydive.com. In short, Walmart is using every asset – stores, staff, and even in-store robotics – to make local fulfillment faster and more economical.

Best Buy – Finding the Right Balance: Electronics retailer Best Buy also implemented ship-from-store, but its case shows the need for balance. During the pandemic, Best Buy fulfilled a large share of online orders from stores. By late 2023, however, Best Buy intentionally reduced its ship-from-store volume to the lowest level since pre-2020 retaildive.com. In Q3 2023, about 62% of Best Buy’s e-commerce packages were shipped from automated distribution centers (meaning only ~38% came from stores) retaildive.com. The CEO explained this shift was to free up store employees for customer-facing roles like assisting shoppers and handling pickup orders, rather than packing boxes retaildive.com. Nearly one-third of Best Buy’s U.S. sales are online, and 43% of those online sales are picked up in-store retaildive.com– a huge volume that store staff manage. By moving more shipping back to warehouses, Best Buy can dedicate in-store labor to serving walk-in customers and running efficient pickup counters. That said, Best Buy isn’t abandoning ship-from-store entirely; it still uses stores for online orders when optimal, and it’s remodeling stores with more space for backroom fulfillment and inventory staging to improve efficiency retaildive.com. Best Buy’s experience underlines that ship-from-store is not one-size-fits-all – retailers must calibrate how much fulfillment to run through stores vs. warehouses based on their product mix and service priorities.

Impact on Fulfillment Costs and Delivery Times

One of the biggest drivers behind ship-from-store adoption is the potential to lower fulfillment costs and accelerate delivery. Using stores as fulfillment centers can cut both last-mile costs and order processing expenses:

Reduced Shipping Distance = Lower Costs and Faster Shipping: Fulfilling an order from a store that is geographically closer to the customer shortens the last-mile distance. This often means packages can be delivered via ground shipping within a single zone, which reduces average shipping cost per ordershipbob.com. It also naturally speeds up transit times , enabling two-day or next-day delivery even without air shipping. For example, Target’s leadership noted that leveraging stores for fulfillment saved significant costs and improved same-day delivery capabilities supplychaindive.com. Similarly, Walmart stated that ship-from-store improves delivery speed and cost efficiency as a core benefit walmartgolocal.com. In practice, many retailers find shipping from a local store can be 20-30% cheaper than shipping the same order from a distant warehouse, after accounting for fuel, labor, and packaging savings (especially when customers choose curbside pickup, which eliminates shipping costs entirelydigitalcommerce360.com).
Lower Fulfillment Processing Cost: Fulfilling online orders in-store can be more cost-effective than in giant warehouses for certain orders. Target revealed that by shifting e-commerce orders to stores, it saw a 40% reduction in overall fulfillment cost supplychaindive.com. Stores already have staff and inventory on hand, so using them to pick and pack online orders makes additional use of existing assets. It can defer the need to build more distribution centers. Also, when customers pick up orders in the store (BOPIS), packaging costs drop and shipping fees are zero – Target found that store pickups and curbside drive-up dramatically lowered the per-order fulfillment expense digitalcommerce360.com. However, it’s worth noting that labor efficiency is key – if store processes are not optimized, in-store picking can be slower or require more staff hours than a mechanized warehouse. Retailers mitigate this with technology and training (discussed later).
Same-Day Delivery Capabilities: Ship-from-store has been essential for retailers to offer same-day and 1-hour delivery services. Traditional distribution centers alone struggle with true same-day delivery because of distance. By staging inventory within local stores and using gig-worker delivery services or couriers, retailers meet ultra-fast delivery promises. Walmart, Target, and others use store fulfillment combined with services like Shipt, DoorDash, or their own driver networks to get online orders to nearby customers in under 2 hours. Same-day delivery is now growing at twice the rate of other fulfillment options for Target and makes up a third of its fulfillment volume

supplychaindive.com, largely thanks to stores handling those orders. Many retailers see that ship-from-store is effectively a requirement to compete with Amazon’s same-day/next-day reach. In fact, a recent industry survey found 99% of retailers plan to offer same-day delivery by 2025 , up from only 35% who could do so in 2022 dcvelocity.com. Achieving this will rely on “hyperlocal” fulfillment strategies – i.e. using stores or small local fulfillment hubs – to overcome the cost and distance challenges of rapid delivery dcvelocity.com.

Of course, the cost equation can vary. Shipping from stores may introduce new costs (e.g. equipping stores with packing materials, hiring extra staff, software integration). Retailers must ensure inventory accuracy and efficient processes, or else the benefits on delivery time might be offset by higher operational expense. But overall, when done right, ship-from-store tends to improve the trade-off between speed and cost. Retailers like Walmart explicitly note it “optimizes inventory, improves cost efficiency, and improves delivery speed” walmartgolocal.com, delivering a better customer experience without breaking the bank on shipping.

Consumer Expectations for Shipping Speed in 2025

Today’s consumers have been conditioned by Amazon Prime and others to expect fast and reliable shipping , and those expectations are only rising heading into 2025. However, speed isn’t the only factor – consumers also care about cost and convenience. Here are the key insights on what shoppers expect:

Fast Shipping as a Baseline: What was once considered premium (two-day or same-day delivery) is increasingly seen as standard. Same-day delivery, in particular, has become “table stakes” in 2024 for many retailers walmartgolocal.com. Customers now expect the option of same-day or next-day delivery for a wide array of products – even relatively low-cost items – whereas a few years ago that speed was a luxury service walmartgolocal.com. This doesn’t mean every order needs to arrive same-day, but shoppers want the choice of ultra-fast fulfillment when it matters. Retailers report that offering faster delivery can drive significant increases in sales. (Walmart GoLocal noted one retail client saw a big jump in new shoppers after introducing same-day delivery walmartgolocal.com.) In short, to meet 2025 expectations, retailers feel pressure to make near-instant delivery available, at least in urban and suburban markets.
Free Shipping Over Speed (If Forced to Choose): Interestingly, while consumers want fast shipping, surveys show they won’t sacrifice cost for blazing speed in most cases. A 2024 McKinsey survey found over 95% of U.S. consumers prefer free standard shipping versus paying for expedited shipping mckinsey.com. In fact, more than 80% said they would still purchase an item even if delivery takes 4–7 days , as long as the shipping is free

mckinsey.com. Only a very small segment (under 5%) prioritize getting the fastest possible delivery regardless of cost mckinsey.com. This means customers have come to expect fast and free – a tough combination for retailers. Two-day free shipping is an expectation that Amazon cemented (e.g., 39% of U.S. shoppers now say they expect two-day shipping to be free

approvedforwarders.com). As we enter 2025, the consensus is that free shipping within about 2 days is the new norm for many product categories, with an option to pay (or subscribe to a program) for same-day/overnight in urgent cases. Retailers are responding by using ship-from-store and local delivery to enable both speed and affordability.

Reliability and Precision: Another aspect of consumer expectation is reliability. Many shoppers are willing to accept slightly slower deliveries if it means the arrival date is dependable and communicated. In surveys, consumers rank on-time delivery within the promised window as more important than sheer speed mckinsey.com. They would rather an order take 4–5 days and arrive exactly when expected, than be told 2 days and have it show up late. This puts pressure on retailers to have accurate fulfillment and carrier integrations. Ship-from-store can help here by shortening the supply chain (fewer handoffs that can go wrong) and allowing retailers to set realistic local delivery windows that they can consistently meet. In 2025, we can expect customers to demand not just fast shipping, but transparent tracking and flexible scheduling. More than half of consumers want the ability to schedule deliveries or adjust timing mckinsey.com, and they track orders closely to ensure timely arrival

mckinsey.com. Retailers implementing store fulfillment need to provide robust notification systems and live tracking, especially when using gig drivers or couriers for local drops.

Varied Expectations by Category: Consumer urgency differs by product type. For groceries or perishables, same-day or even 1-2 hour delivery is often expected (especially post-pandemic). For general merchandise or apparel, customers might accept a couple of days wait. Retailers are tailoring delivery promises by category – for example, offering faster guarantees for fresh or high-priority items, but using slightly slower (yet free) shipping for less urgent goods walmartgolocal.com. In 2025, a nuanced approach will be key: meet “need it now” expectations with local stores (ship-from-store or curbside) for certain items , while still providing a free standard option for others. The common theme is that consumers expect options. They want to decide between speed vs. cost vs. pickup, depending on the situation. An omnichannel retailer’s job is to enable all these fulfillment options seamlessly.

Bottom line: Consumers in 2025 expect retailers to offer fast shipping – ideally same-day or next-day – but they also expect not to pay a premium for it in most cases. The ship-from-store model is a direct response to this challenge, as it brings inventory closer to customers to achieve faster delivery without outrageous costs. Retailers that can perfect their store-based fulfillment will be better positioned to meet shoppers’ high expectations for both speed and price (and reliability) walmartgolocal.com mckinsey.com.

AI and Automation in Store-Based Fulfillment

Optimizing ship-from-store operations at scale would be daunting without technology. That’s where artificial intelligence (AI) and automation come into play – helping retailers decide the best fulfillment plans, streamline in-store work, and even automate parts of the process. In 2024, we’ve seen retailers deploy AI/automation in several ways to supercharge store fulfillment:

Intelligent Order Routing: A critical challenge is figuring out which location should fulfill each online order – the goal is to choose a store (or warehouse) that can deliver fastest at the lowest cost, without hurting in-store stock for walk-in customers. AI-powered order management systems (OMS) are increasingly making these decisions. They analyze factors like inventory levels at stores, distance to customer, delivery capacity, and promised delivery date to automatically route each order to the optimal fulfillment node. This kind of smart order orchestration uses AI to balance speed and cost , eliminating manual guesswork mytotalretail.com. For example, an AI-driven system might split an order or suggest shipping from two stores if one store is out of one item – all done instantly. According to Total Retail, AI-based fulfillment logic can even recommend new rules and automate decisions (e.g. when to ship from a store vs. a warehouse) to continuously improve performance mytotalretail.com. Retailers using AI in this way report fewer split shipments and lower shipping expenses, while still hitting service level promises mytotalretail.com. In short, AI is the brains ensuring each online order is fulfilled by the right store at the right time.
In-Store Picking Optimization: Once an order is routed to a store, automation helps within the four walls. Many retailers equip store associates with mobile apps that use algorithms to optimize picking routes through the store, batch similar orders together, and minimize time away from the sales floor. For instance, grocery chains have utilized software that directs pickers in an efficient path (similar to how warehouse robots work) and even uses machine learning to predict the best times for picking to avoid aisle congestion. Some are experimenting with vision AI and smart carts that scan items as associates pick, reducing errors. While not every retailer is at the cutting edge, even simple tech like a tablet app for pickers can dramatically boost productivity – Walmart’s Store Assist app provides a unified interface to manage pick-pack-ship tasks, ensuring consistency and minimizing errors with a guided workflow

commerce.walmart.com. The result is faster in-store fulfillment and higher accuracy, which are crucial for ship-from-store to scale effectively.

Robotic Automation (Micro-Fulfillment Centers): On the more advanced end, retailers are deploying automated systems inside or alongside stores to handle online order fulfillment. These micro-fulfillment centers (MFCs) are often compact automated storage and retrieval systems that hold a few thousand high-volume items. Robots or shuttles retrieve items for orders, which store staff then consolidate with any fresh or large items. Walmart, for example, has been rolling out its Alphabot system (from its acquisition Alert Innovation) in select stores – a robotic fulfillment system that can pull products in a small back-of-store warehouse. In Walmart’s pilot, the Alphabot MFC allowed orders to be assembled within an hour for pickup or delivery grocerydive.com. It also improved efficiency enough to handle orders for multiple nearby stores from one automated hub grocerydive.com. Other chains have used systems by Fabric or Dematic to similar effect. The promise is that automation can handle 80-90% of the picking for online orders, drastically reducing the manual labor burden in stores. This not only speeds up fulfillment (robots can work quickly and 24/7), but also frees associates to focus on tasks like picking fresh items or helping customers. While these systems require investment, many retailers see them as the future for high-volume locations – especially grocery retailers dealing with thousands of online orders a week. By 2025, we expect to see more stores outfitted with miniature fulfillment robots or automated pickup towers, blending the physical retail and warehouse worlds.
AI Forecasting and Labor Planning: Another role of AI is behind the scenes – forecasting demand and staffing needs for omnichannel fulfillment. Retailers are leveraging AI to predict spikes in online orders at the store level (influenced by promotions, local events, weather, etc.), so they can schedule enough store labor for picking and packing ahead of time. AI models can also suggest optimal inventory allocation : how to distribute stock between warehouses and stores so that each region has the right products on hand to fulfill local online demand. Walmart, for instance, uses machine learning for inventory optimization across its network, which helps ensure popular items are in-stock at local stores to fulfill e-commerce orders promptly mytotalretail.com. Additionally, AI can monitor in-store fulfillment performance and identify bottlenecks (e.g., a particular store consistently lagging in pickup prep times) – flagging managers to take corrective action or adjust processes. All these uses of AI contribute to a smoother, faster fulfillment operation that can meet customer expectations.

In summary, AI and automation are becoming the unsung heroes of ship-from-store. From smart order orchestration that “eliminates manual trade-offs between speed and cost”mytotalretail.com**** to robots that cut picking time for a 50-item order down to minutes , technology is amplifying what stores can do. Retailers embracing these tools are turning their store networks into a high-tech mesh of fulfillment centers, gaining a competitive edge in omnichannel fulfillment. And notably, even solution providers are making these innovations accessible – for example, Adobe Commerce (Magento) integrates with store fulfillment solutions (like Walmart’s Store Assist) and offers native support for ship-from-store within its order management capabilities business.adobe.com. This means retailers on modern platforms can more easily plug in AI-driven fulfillment rules and in-store apps to optimize their ship-from-store performance.

Best Practices for In-Store Fulfillment Staffing and Logistics

Implementing ship-from-store successfully requires not just tech, but solid operational practices on the ground. Stores are traditionally built for shoppers, not for e-commerce fulfillment, so retailers have learned to adapt layouts, staff routines, and processes to accommodate both. Here are some best practices and tips for in-store fulfillment (BOPIS and ship-from-store) that have emerged:

Plan Staffing Levels and Schedules Proactively: Don’t overwhelm your retail associates with online order duties without proper planning. Assess your order volume patterns and forecast the demand for in-store fulfillment before “flipping the switch.” It’s wise to hire or allocate additional staff if needed, especially during peaks starshipit.com. Many retailers adjust weekly schedules to ensure dedicated pickers are on shift during high online order times (e.g. mornings for next-day shipping, or early evening for same-day). Batch picking during quiet store hours is a common tactic – e.g. staff might pick online orders in early morning before the store opens or when foot traffic is low starshipit.com. By anticipating workload, you avoid under-staffing (which leads to slow fulfillment and stressed workers) or over-staffing (wasting labor budget).
Train Store Staff as Fulfillment Experts: Fulfilling orders is a different skill set than traditional customer service. Retail associates need comprehensive training on e-commerce processes – from using handheld devices and picking efficiently, to proper packing and shipping procedures

starshipit.com. Key training points include: how to pack items securely (choosing correct box sizes, using bubble wrap, etc.) starshipit.com, how to manage their time and prioritize orders, and how to handle any customer communication about orders. It’s also critical to train staff on the software tools (order management apps, label printers, inventory lookup) they’ll use

starshipit.com. Retailers should train a core group in each store as fulfillment leads, who can then mentor others. Remember that initially, there may be resistance – store employees hired for sales may feel picking is outside their job. Clear training and expectations help, but also consider incentivizing and motivating staff : explain how omnichannel fulfillment benefits the company (and keep any commission structures fair if salespeople are spending time on picking) starshipit.com. Some retailers create a rotation so that no one person is stuck in the stockroom all day; mixing duties can keep morale up.

Optimize Store Layout and Inventory for Picking: A big challenge is that stores are designed for shoppers, not for picker efficiency foodlogistics.com. To counter this, retailers are adopting best practices from warehouses. One tip is to designate a small area or “dark store” section for order staging and fast-moving e-commerce items. For example, some apparel retailers keep their most popular online items in a backroom area with easy access, so pickers don’t need to trek the shop floor every time. Clear signage and organization in stock rooms is crucial so pickers can quickly find SKUs. In grocery, where possible, arrange aisles or set up secondary storage to minimize back-and-forth. Also, ensure scanning and inventory update systems are in place – every item picked for an online order should decrement store inventory in real time to prevent overselling. Using barcode scanners or mobile apps as employees pick will keep inventory accurate and also double as a quality check (right item, right quantity). Overall, the store should evolve to accommodate both customers and fulfillment. Many are adding dedicated pickup counters or even drive-up bays, as well as shelving for holding order packages awaiting pickup or carrier pickup.
Leverage Technology for In-Store Workflow: Empower your staff with the right tools to make ship-from-store efficient. Tablets or rugged smartphones for staff are basically a must-have in 2024 – “the days of picking with pen and paper are long gone” starshipit.com. A good store fulfillment app will show new orders instantly, prioritize them by cutoff times, provide picking lists, and allow easy updates (like marking an item out-of-stock or printing a shipping label right at the store) starshipit.com. If using an order management system like Adobe Commerce OMS or others, ensure all store team members are trained on its use. Technology also includes label printers, scales, and packing stations in stores. It’s worth setting up a small packing area in each fulfilling store with tape, boxes, printer, etc., so staff aren’t scrambling to find materials. Modern ship-from-store solutions even integrate shipping rate shopping – the system can choose the best carrier and print labels in one click, which reduces human error and ensures cost-effective shipping rates (Walmart’s Store Assist, for example, automates carrier selection to cut shipping costs by 18–22% on average through rate optimization) commerce.walmart.com. By giving store teams a unified interface and proper equipment, you standardize the process and make it faster. In fact, Walmart highlights a “unified employee interface” as a key to boosting productivity and minimizing errors in store fulfillment

commerce.walmart.com.

Adjust Metrics and Incentives: Managing in-store fulfillment also means redefining success metrics at the store level. It’s a best practice to track fulfillment KPIs for each store: e.g. average order pick time, orders shipped per day, pick accuracy, etc., in addition to traditional retail sales metrics. Share these with store managers so they can identify improvement areas. Some retailers incorporate fulfillment performance into store staff evaluations or create bonus structures for meeting online order targets, to ensure it’s taken as seriously as sales. Also, re-think associate incentives: if a store employee typically earns commission on sales, consider how to reward them for time spent fulfilling online orders (which generate revenue too, just not rung up at that register). Aligning incentives prevents any resentment and encourages staff to view omnichannel orders as part of their core job, not a distraction starshipit.com.
Customer Experience at Pickup: For omnichannel retailers, in-store fulfillment often goes hand-in-hand with BOPIS (buy online, pick up in store) and curbside services. Best practice here is to make pickup fast and convenient – dedicated pickup counters or lockers, clear signage when customers enter, and staff trained to quickly hand off orders. Even for ship-from-store (home delivery), the store may occasionally interact with customers (e.g. if there’s an issue, or a customer wants to return an item in store). So customer service training should extend to these scenarios: staff should know how to handle inquiries about online orders, process in-store returns for online purchases, etc. starshipit.com. A seamless experience across channels will build customer trust in your omnichannel model. One bad pickup experience can turn a customer off, whereas a smooth one reinforces the convenience of shopping with you.

By following these best practices – proper staffing, training, layout tweaks, and tech enablement – retailers can run efficient store-based fulfillment operations that complement their traditional retailing. As one guide put it, “Successfully implementing in-store fulfillment is a team effort” , requiring giving your staff the tools and adopting industry-wide best practices so you can reap the benefits starshipit.com. Many brands have found that after an adjustment period, stores can routinely handle a high volume of online orders without hurting the in-store shopper experience. The payoff is faster delivery to customers and better utilization of inventory across all locations.

Challenges and How to Overcome Them

While ship-from-store offers clear advantages, it also comes with challenges that retailers must address. Implementing this model isn’t always smooth – it can strain store operations, complicate inventory management, and require investment. Here are some common challenges retailers face with ship-from-store, and strategies to overcome them:

Inventory Accuracy and Visibility: One of the biggest hurdles is maintaining accurate, real-time inventory across all stores and online. When you fulfill from stores, your store inventory is effectively shared with online customers – which means if your systems aren’t synced, you risk selling something online that just sold in-store five minutes ago. Overselling and stockouts are a serious concern shipbob.com. To overcome this, retailers must implement a robust omnichannel inventory management system. Ideally, use a single platform or well-integrated systems that update inventory levels instantly as purchases or picks happen. Many turn to distributed order management (DOM) software or extend their e-commerce platform’s inventory module to stores. Investing in an OMS that supports unified inventory and “available to promise” logic is critical shipbob.com. Additionally, some retailers set aside safety stock in each store for online orders – essentially a buffer so that the last few units of a product aren’t offered to online shoppers if the store is busy selling it. This can prevent disappointing cancellations. Regular cycle counts and audits in stores also help keep inventory records clean. In short, overcoming inventory challenges means upgrading tech and processes to treat all channels as one – something Adobe Commerce users, for example, can leverage via built-in omnichannel inventory features (ship-from-store, ship-to-store, endless aisle) that ensure store stock is visible and saleable online with proper controls

business.adobe.com.

Store Associate Bandwidth and Buy-In: Another challenge is that store staff may already be busy with customers and tasks; adding picking/packing can overload them and even degrade in-store service. There’s also change management – some associates resist the added duties (it’s not what they signed up for). We saw this with Best Buy, which noticed in-store customers weren’t getting enough attention when associates were tied up shipping orders

shipbob.com. The solution is two-fold: staffing and culture. Retailers should dedicate specific hours or personnel to fulfillment tasks , rather than simply piling it on all associates. For example, having one or two people per shift responsible for online orders (and rotating that role) can ensure efficiency without everyone multitasking at once starshipit.com. During peak times, bringing in additional temp workers or shifting back-office employees to help on the floor can relieve pressure. Culturally, it helps to communicate the “why” to store teams – explain that ship-from-store is driving sales and that their work is directly contributing to company growth. Some retailers have reframed store roles as “omnichannel associates” and celebrated fulfillment achievements in the same way as big sales. Proper training and motivation (as discussed earlier) go a long way starshipit.com. With support and realistic workloads, associates can adapt. Also, designing stores and processes to minimize disruption – e.g. separate picking routes away from shoppers, using staging carts – will help associates serve both in-store and online customers without conflict.

Operating Costs (Labor and Packaging): Fulfilling orders from stores can be more labor-intensive on a per-order basis than a highly automated warehouse. Each store might handle only dozens of orders a day, so you don’t have the economies of scale of a DC processing thousands. There are also costs like shipping materials at each store and training time. As ShipBob’s analysis noted, “shipping from store involves many hidden costs” , from hiring extra staff to increasing storage space, and these can add up shipbob.com. Retailers fear that the cost to retrofit stores and manage all these processes could outweigh the savings in delivery. To overcome this, it’s important to streamline the in-store fulfillment process as much as possible (so each order takes minimal touch time) and to gradually scale the program. Start with ship-from-store in higher-volume locations or regions where it makes the most financial sense (like areas far from your warehouses, where shipping from a local store truly saves money). Use technology to automate what you can – for instance, generating shipping labels and choosing the cheapest carrier automatically, as mentioned. Also, consider centralizing some aspects: some retailers have micro-fulfillment hubs that serve multiple stores in an area, easing the burden on each individual store. Another tactic is to closely monitor metrics like cost per order fulfilled in-store vs. at DC – if certain order types are too costly to do in-store, route those from a warehouse instead. In essence, treat ship-from-store as one part of a larger fulfillment network and continuously optimize. With time, as order volumes rise, stores may actually reach efficiencies (and keep in mind store fulfillment defers warehouse expansion costs). A case in point: Target’s huge store volume allowed it to absorb the costs and still come out ahead financially

supplychaindive.com. But a smaller retailer with only a few stores might find a 3PL or ship-to-store (instead of ship-from-store) more cost-effective – every business should crunch the numbers. If the costs start overshadowing the benefits, consider partial use of 3PL fulfillment centers to handle overflow (ShipBob and others pitch exactly this: they argue high-volume merchants might be better off outsourcing rather than overhauling every store for fulfillment

shipbob.com).

Store Space Constraints: Fulfilling online orders requires space for staging, packing, and holding packages for pickup. Many stores (especially smaller format ones or mall stores) struggle to find room for this. You might see the stockroom overflowing or customer areas cluttered with pickup shelves if not managed. Overcoming this might involve store layout changes or capital improvements. Some retailers have remodeled stores to allocate more backroom for e-commerce orders – even reducing sales floor square footage to make space retaildive.com. Others use creative solutions like vertical storage (shelving, racks) for order bins, or even portable packing stations that can be tucked away during store hours. If space is extremely tight, a retailer could fulfill only certain types of orders from that store (e.g., small items) and redirect larger orders elsewhere. Another approach is ship-from-store “hub” models , where not every store ships orders – maybe one store in a mall acts as the fulfillment center for neighboring stores. While that reduces convenience of every store shipping, it can concentrate the space needs into fewer locations. In any case, management needs to regularly evaluate if the store environment is becoming too congested. Maintaining a pleasant in-store ambiance is still vital, so solutions like off-hours picking and behind-the-scenes staging help keep fulfillment activities invisible to shoppers. Pilot testing ship-from-store in a subset of stores can reveal space-related issues before rolling out chain-wide.
Technology and Integration Challenges: Implementing ship-from-store often requires integrating point-of-sale systems, inventory databases, online order systems, and shipping carriers – a technical challenge that cannot be ignored. Retailers may face initial headaches ensuring that an online order flows to the right store’s system, that employees get notified, that shipping labels bill correctly, etc. Older legacy systems can be a barrier , and some retailers end up investing in a new order management system or upgrading their e-commerce platform to handle omnichannel. The best way to overcome this is to choose technology that is built for omnichannel. For example, Adobe Commerce’s OMS or similar platforms provide out-of-the-box support for BOPIS and ship-from-store workflows business.adobe.com, which can greatly shorten the implementation time. It’s also wise to start with a simple process and then iterate – e.g., maybe initially limit ship-from-store to one region or a certain order type while ironing out integration bugs. Close collaboration between IT, e-commerce, and store operations is needed; some retailers set up an “omnichannel task force” to handle cross-department issues during the rollout. Many have also partnered with solution providers (like Walmart Commerce Technologies, Manhattan Associates, etc.) for their proven store fulfillment systems rather than trying to custom-build everything. Ultimately, overcoming tech challenges might cost some upfront time/money, but it’s a solvable one – and once the system is in place, it unlocks all the benefits we discussed.

Despite these challenges, retailers are finding ways to make ship-from-store work. The key is acknowledging the difficulties and tackling them head-on with planning and investment. For instance, inventory management complexities can be tamed with a good OMS, store associate resistance can be addressed with training and incentives, and last-mile coordination can be improved by partnering with delivery services hotwax.co walmartgolocal.com. Many retailers, large and small, have successfully navigated these issues. They report that once ship-from-store is up and running, it becomes an indispensable part of their omnichannel strategy – enabling flexibility and resiliency (e.g., if a warehouse is out of stock or shut down, stores can keep fulfilling). As one analysis summarized, ship-from-store increases store productivity and inventory turns and can drive more sales, but you must invest in the systems and process to “do it right” shipbob.com. Retailers who overcome the initial hurdles often gain a significant competitive advantage in meeting customer needs.

Conclusion

Ship-from-store has moved from a niche experiment to a mainstream fulfillment strategy in omnichannel retail. Recent case studies from Target, Walmart, Best Buy, and others illustrate both the potential benefits and the practical considerations of using stores as fulfillment centers. The approach can significantly reduce delivery times and costs , leveraging proximity to customers and existing store infrastructuresupplychaindive.com walmartgolocal.com. It is also a direct answer to evolving customer expectations – as shoppers demand ever-faster shipping, retailers are turning stores into assets for speed and convenience.

Implementing ship-from-store, however, is a journey that requires investment in technology, training, and process adaptation. The latest industry insights (2024-2025) show that success in store-based fulfillment comes from unifying online and offline operations: real-time inventory visibility, smart order routing (increasingly with AI), well-trained store staff, and reconfigured store layouts all play a part. Retailers are also embracing automation – from simple mobile tools for employees to advanced robotics – to scale up their in-store fulfillment efficiently mytotalretail.com grocerydive.com.

For omnichannel retailers looking to enhance their fulfillment strategy, the takeaways are clear. Use stores strategically – not every store needs to ship every order, but each store can be a node in your network to improve reach. Focus on the customer experience – fast shipping is important, but so are reliability and options like pickup or scheduled delivery mckinsey.com walmartgolocal.com. And lastly, learn from those who’ve done it : start small, measure impact on cost and service, and refine. Platforms like Adobe Commerce are already enabling these capabilities with built-in ship-from-store features and partner integrations business.adobe.com, making it easier to get started on the technical front.

In an era where online and offline retail are blurring, ship-from-store provides a way to unify channels and delight customers. It turns your brick-and-mortar footprint into a competitive advantage in the fulfillment race. With consumers in 2025 expecting both speed and convenience, retailers that master ship-from-store and in-store fulfillment will be well-positioned to deliver on those expectations – meeting customers where they are, with inventory that’s already nearby, and getting products to their doorsteps faster than ever.