Why First-Arrived-First-Out (FAFOᵀᴹ) is the new way businesses are optimizing their labor, reducing waste, and driving customer retention.

 

By Maie Lee | Director of Corporate Strategy & Organization Development

 

Article Summary

The longevity of in-store or curbside pickup is no longer in question.  More and more retail, grocery, and QSR/restaurant brands have realized this too.  For example, now more than half of the top 1,000 retailers offer curbside pickup compared to around 10%¹ The reasons behind the popularity of pickup are uncomplicated.  Most recently, many businesses had no choice but to expand their e-commerce operations for both pickup and delivery due to the in-person safety limitations imposed by the pandemic².  In general, consumer psychology says saving even a small amount of time satisfies people³, which is a core benefit of pickup, and offering multiple shopping methods means more sales opportunities.  Let’s dig into some specifics on why pickup is here to stay.

Why is Pickup Here to Stay?

Safety. How many alcohol wipes does it take to kill Covid off a cereal box?  Did you hold your breath through a crowded sidewalk?  We’ve all formed some level of hyper-hygienic habits during the pandemic especially when running errands for bare essentials.  For example, 77% of consumers say that “going forward they will seek out information on the type of health and safety standards and processes businesses have in place before visiting them.”⁴ Perhaps getting the vaccine helped some folks mitigate the obsession with cleanliness.  But even after a successful vaccine, only 50% of consumer survey participants said they would visit physical stores and 87% of consumers say businesses should continue to offer options like curbside pickup that limits the need for in-person visits.”⁶,⁷.  Covid or not, most consumers want to be able to stick to their e-commerce routines.  In order to retain customers and avoid losing sales volume, retailers, grocery stores, and QSRs/restaurants ought to continue honoring consumer preferences and maintain multiple off-premise shopping options.  At the very least, brands should think about their image and how their safety measures, or the lack of, come across to their audiences.

man in grocery store wearing mask

Convenience The Bureau of Labor Statistics’s latest American Time Use Survey⁸ results show that the average full-time employee works about 8 hours per work day.  In addition to work, both men and women spend about 2 hours doing household chores while parents add another hour or so of childcare.  Somehow people fit in about 5 hours of leisure activities throughout the day such as watching TV, socializing, and exercising.  In short, people are busy all the time.  Busy people are drawn to creating more efficiencies in their lives.  For example, a parent can drop off their kid at school and grab a hot breakfast via BOPIS/BOPC on their commute to work without missing a beat, worrying about being late, or sacrificing the quality of their meal.  BOPIS/BOPC has become a lifestyle that empowers consumers to have more agency over their time. 

Price.  Prices of goods have been going up lately due to a variety of reasons including shortages in labor and materials as well as high consumer demand.  Margins are becoming slimmer for brands paying 20% or more in marketplace fees to delivery service providers (DSP)¹⁰BOPIS/BOPC removes shipping or delivery fees from the equation making it a must-have cost-effective option for both brands and customers¹¹ In fact, big brands like Starbucks and Chili’s have been investing to improve their pickup operations because they noticed their customers prefer it over delivery citing exactly this as a reason¹².  With third-party fees gone, prices can stay as low as possible for customers and margins can stay optimal for brands.  

Profit.  The “do-or-die” pickup operations adopted during the pandemic evolved into a long-term online business strategy for many brands, especially retailers¹³.  Brands are realizing that the massive increase in their e-commerce pickup sales isn’t a coincidence.  For example, grocery brands offering pickup increased average basket sizes by nearly three-fold¹⁴.  More importantly, brands are realizing that it’s not just about putting a pickup process in place.  Unshockingly, the pickup experience has to be good.  Research shows that just one bad in-person or online experience will drive customers away and make them over 60% less likely to return¹⁵.  What’s worse, half of the time they are likely to tell others about their bad experience¹⁶, which can spread quickly and even block new customers.  By contrast, a positive experience is likely to increase repeat customers by 90% and in-store or online sales by 60%¹⁷ Thus brands with the best pickup experiences can obtain recurring loyalty and revenue.

Flybuy as a Solution

Safety.  As a location-based solution, Flybuy informs staff about customers whereabouts especially on-premises within and near the pickup area for a timely and stress-free order handoff.  No more unnecessary conversations and exposure to things like “Are you Karen who ordered the chicken enchilada?” or “Can you please show me your ID with your name on it so that I can confirm that this order is really for you?”  Customers, delivery drivers, and staff can rely on Flybuy’s efficiency-focused features to eliminate frustrating friction and avoidable annoyances that have potential to be health hazards.

Convenience.  Flybuy’s First-Arrived-First-Out (FAFOᵀᴹ) feature isn’t just convenient for a seamless customer pickup experience. FAFO creates labor efficiency by helping staff automatically prioritize incoming orders based on customer arrival time¹⁸. A dedicated staff to manage off-premise orders or to manually organize order priority based on order type, size, etc. is no longer necessary. Let Flybuy assist staff while they carry out their everyday responsibilities without missing a beat, worrying about messing up an order, or sacrificing the quality of a customer’s meal.  

Price & Profit. 

In a recent survey by a Flybuy restaurant, 85% of of their customers said they were highly likely to return as a result of at least one good curbside pickup experience.

 As a result, that chance quickly dropped to 23% if curbside pickup were to no longer be an option.  Having curbside pickup is a necessity moving forward, and companies will lose or miss out on revenue by removing it as an offering.  For many businesses, lost revenue could mean cutting costs such as labor (e.g,. decreasing payroll) and/or jacking up prices to make up for the difference.  Neither is a sustainable strategy.  By contrast, investing in an affordable solution like Flybuy helps brands avoid such pitfalls and instead realize up to 20% in additional revenue that could be reinvested into other needs such as more labor support, cutting-edge equipment, finest ingredients and materials, or other business development efforts.  Keep customers coming back for more of the best goods and services without an eye-popping price ticket. 

Conclusion

As we hope for the world to go back to normal, it turns out we have a new normal.  Online shopping habits that saved lives throughout the pandemic such as pickup (BOPIS/BOPC) and delivery are now routine for people around the world, especially amid uncertainty of evolving covid.  Pandemic or not, research continues to tell us that people are not interested in giving up convenient options to get what they need¹⁹,²⁰.  For example, in a recent customer survey conducted by a QSR brand using Flybuy, customers said they are not likely to return to the QSR by up to 73% if the curbside pickup option were to disappear.  This means that turning off BOPIS/BOPC for whatever reason (e.g., during rush-hour), while it seems necessary at the time, can be more harmful than helpful because doing so can negatively affect sales, customer loyalty, and even brand image.  

Get Flybuy pickup instead.  Flybuy is integrated with more than 20 (with another 20+ in the works) mobile app, delivery service, online ordering, POS, and fulfillment technology providers such as NCR Aloha, olo, Oracle, Toast, DoorDash, Grubhub, etc (check out the full list here) to make implementation and usage faster and easier all around.  Meet overwhelming operations and low staff coverage issues head on with Flybuy.  It’s never too late to empower staff with a solution designed for their success as well as to create an enjoyable customer experience.

Get Flybuy and Save Time. It’s that easy. Talk to an expert today.

References:

[11] Big Commerce. (2021). Bring your customers low-contact convenience: Why and how to add curbside pickup to your ecommerce business. Big Commerce. https://www.bigcommerce.com/articles/offline-to-online/curbside-pickup/ 

[8] Bureau of Labor Statistics. (2020). American time use study – 2019 results. U.S. Department of Labor. https://www.bls.gov/news.release/pdf/atus.pdf  

[2,7] Conger, K. (2021). A pandemic lifeline for restaurants, delivery is ‘here to stay.’ The New York Times. https://www.nytimes.com/2021/07/02/technology/restaurant-delivery-takeout-orders-covid-coronavirus.html?referringSource=articleShare 

[21] Freedman, L. (2021, March 19). The Shopper Speaks: 3 secrets why curbside will not die post-COVID-19. Digital Commerce 360. https://www.digitalcommerce360.com/2021/03/19/the-shopper-speaks-3-secrets-why-curbside-will-not-die-post-covid-19/ 

[3] Festjens, A. & Janiszewski, C. (2015). The value of time. Journal of Consumer Research. https://vlab.decisionsciences.columbia.edu/newsletter/April0113/the%20value%20of%20time.pdf 

[9] Friedman, G. (2021, April 29). Diapers, cereal and, yes, toilet paper are going to get more expensive. The New York Times. https://www.nytimes.com/2021/04/29/business/consumer-goods-prices.html 

[12] Haddon, H. & Kang, J. (2020, June 25). Pickup gains ground over delivery. Wall Street Journal. https://www.wsj.com/articles/pickup-gains-ground-over-delivery-11593085831 

[18] Lee, M. (2021). Maximize labor efficiency and save time using Flybuy’s First-Arrived-First-Out (FAFO) approach.  Radius Networks.  https://www.flybuy.com/flybuy-maximizes-labor-efficiency 

[10] Littman, J. (2019, October 3). Delivery by the numbers: How top third-party platforms compare. Restaurant Dive. https://www.restaurantdive.com/news/delivery-by-the-numbers-how-top-third-party-platforms-compare/564279/ 

[13] Maheshwari, S. & Corkery, M. (2020, December 22). Customers still like to shop in person, even if they get only to the curb. The New York Times. https://www.nytimes.com/2020/10/09/business/retailers-curbside-pickup.html 

Marhamat, B. (2021, February 10). Five Consumer Behavior Trends To Watch In 2021. Forbes. https://www.forbes.com/sites/forbesbusinessdevelopmentcouncil/2021/02/10/five-consumer-behavior-trends-to-watch-in-2021/?sh=5e93c9743899 

[1] Melton, J. (2021, April 27). More than 50% of large retail chains offer curbside pickup. Digital Commerce 360. https://www.digitalcommerce360.com/2021/04/27/more-than-50-of-large-retail-chains-offer-curbside-pickup/   

[5, 15, 16, 17, 19] Raydiant. (2021, January 5). Report: The State of Consumer Behavior 2021. Raydiant. https://www.raydiant.com/blog/state-of-consumer-behavior-2021/ 

[14] Redman, R. (2020, October 9). FMI: Online grocery sales jumped 300% early in pandemic. Supermarket News. https://www.supermarketnews.com/issues-trends/fmi-online-grocery-sales-jumped-300-early-pandemic 

[4, 6, 20] Zingle, Medallia. (2020). Covid-19 and the future of commerce.  Medallia Zingle. https://cdn2.hubspot.net/hubfs/393073/2020%20Consumer%20Report/MedZing2020-Future-Of-Commerce-Report-FNL.pdf?_ga=2.256224971.158494267.1624292487-869524381.1624292487