Why You Should Extend the Principles of Retail Consolidation to Your FF&E

A wide range of retailers use retail consolidation to reduce transportation costs, simplify inventory management, and stock their stores more reliably. Unfortunately, many of those same retailers have yet to extend the advantages of this distribution strategy to their FF&E. 

If you’re one of them, that means you’re missing out on significant cost savings. But more than that, you’re also missing an opportunity to dramatically improve your overall process for getting FF&E into your store remodels, conversions, and new openings.

In the following, we’ll detail four efficiencies you can gain by applying the consolidation model to your FF&E. We’ll also share how you can test the waters of FF&E consolidation without diving in head first. But first, let’s be clear on our consolidation terms.

What is retail consolidation?

Retail consolidation involves suppliers shipping resale products to a retailer’s distribution center, or warehouse, rather than directly to a given store. There, the products are compiled as needed into single outbound shipments to specific store sites, typically in full truckloads instead of less-than-truckload amounts.

What is FF&E consolidation?

With FF&E consolidation, a retailer partners with a consolidator who receives and warehouses non-saleable FF&E for use in future store projects. The consolidator also inspects, organizes, re-palletizes (if necessary), and ships FF&E to specific store sites. Similar to retail consolidation, this process prioritizes the use of full truckload shipments over partial truckloads.

Let’s now take a closer look at the efficiencies gained by applying consolidation to FF&E.

Efficiency No. 1: Better staff productivity

If you rely primarily on a just-in-time, vendor-direct approach for your FF&E, a surge of store projects puts heavy demands on your staff to manage dozens of vendors and coordinate potentially hundreds of FF&E deliveries.

While that’s happening, those same staff members will likely need to put other important initiatives on the back burner. But is shepherding FF&E orders really the best use of their time?

With FF&E consolidation, your designated warehouse space creates advantages similar to a retail distribution center. More specifically, your team is empowered to order FF&E items much further in advance, potentially for your entire program’s next cycle. 

And that means you can also ramp up for projects faster because your FF&E are now sitting ready to be picked, packed, and shipped when needed. Then there’s the bigger picture: Your current team members are more efficient because they can now focus on managing FF&E inventory levels—rather than managing all those vendors.

Efficiency No. 2: More cost-effective shipping and logistics

A vendor-direct approach for shipping FF&E typically involves using an inefficient, multi-hub system of less-than-truckload shipments. For you, this ultimately means you’re paying a much higher cost per pallet. And with dozens or more store projects on your horizon, those pallet costs can really start to add up.

On the other hand, similar to retail consolidation, FF&E consolidation saves you significant money thanks to full truckload shipping. On top of that, the warehouse space you now have enables you to buy FF&E in bulk volumes (potentially at discounted costs) for multiple stores, leading to both more full truckloads and fewer overall shipments.

And when it’s time for your consolidator to ship to a store site, you’ll likely be saving money yet again thanks to full truckload shipping. That’s because your consolidator can fill up a truck with your fixtures and with all the other store supplies you’re warehousing with them.

Efficiency No. 3: More reliable delivery and installation

Unlike your steady demand for retail products, your need for FF&E generally comes in surges, typically when you have sites that are being remodeled, converted, or newly built. But that fact arguably makes the timely arrival of FF&E extra critical. 

Unfortunately, vendor-direct orders that should arrive just in time don’t always do that, and deliveries that trickle in over days can delay the installation process. Even worse, if items are so late that they can’t be installed in the designated project window, you may have to keep installers longer (if that’s even an option). Or, you’ll need to call them back. 

Neither scenario will be cheap.

But with FF&E consolidation, since ALL your needed FF&E items are already at the warehouse, they’re ready for delivery to your site on day one. In fact, you could even compress installer timelines, negotiate shorter setups, and move soft openings up in your calendar to start ringing in sales sooner.

Efficiency No. 4: Reduced cost creep

We’ve already touched on how less-than-truckload shipping is both inefficient and expensive. But with every transfer terminal and forklift touch, this process also increases your risk of lost and damaged freight. And that can mean more costs due to reorders and last-minute shipping. 

And what about when a vendor-direct order goes out but the store site isn’t ready for it? You’ll have to find a temporary—and likely expensive—storage solution. 

Since FF&E consolidation maximizes the use of full truckloads (see No. 2), it also minimizes the risk of loss and damage because your freight doesn’t travel through multiple terminals—nor get touched by multiple forklifts. 

Moreover, if there’s a sudden schedule change but FF&E are already en route, the driver simply returns to the warehouse. Your consolidator will unload your FF&E at no extra cost. 

A smart way to ease into FF&E consolidation

Maybe you’re already convinced that FF&E consolidation could benefit your FF&E process. Maybe what gives you pause is the apparent leap it would take to change up your current FF&E distribution system.

If that’s the case, Store Opening Solutions can help. You can give FF&E consolidation a trial run by partnering with us on a smaller-scale project. 

Want more details? Then be sure to contact us to start a discussion today!