Store Gallery: How South American giant Falabella is designing stores for omnichannel

Retailers offering click and collect knew long before the coronavirus outbreak that they would one day need a better way to manage pick-ups, and Falabella has recently launched an automated parcel service for click-and-collect customers.

No company wants to say that it is benefiting from the coronavirus outbreak, but the strategic decisions the retailer has made since the pandemic to expand its omnichannel operations have, in many ways, proved to be perfectly timed as demand for perceived safer, contact-free solutions is likely to soar. 

Supporting improvements in operational efficiency and customer experience, the technology solution is the first of its kind in Chile – essentially a large, and very clever, vending machine.

It’s about creating hyper-efficiency and removing friction, making both the employees’ lives easier and the customers’ shopping experience better. The payoff is that it can deliver click-and-collect orders to customers in just 10 seconds. 

“We want our store teams to be interacting, either with customers or the product, rather than doing low-value activities”

Tomás Platovsky, Falabella

Just as importantly, it addresses the additional strain that the spike in online volumes has placed on already costly high-labour processes for retailers and avoids staff having to leave the sales floor.

“We want our store teams to be interacting, either with customers or the product, rather than doing low-value activities,” explains chief operating officer Tomás Platovsky. 

In short, it makes absolute operational and commercial sense. So much so that this innovative technology is now beginning to be explored by retailers in the UK.

Earlier this year, Asda revealed it had begun trying out the same technology in its Stevenage store, though that remains a trial. 

Also impressive was Falabella’s continued investment in training for store colleagues – what the retailer sees as the “connectivity” between the shop and the customer within a modern retail experience. 

Store teams have to play their part in completing that connection, and that means providing them with the knowledge and skills required. With more than 65,000 employees, the retailer is focused on creating high-performance teams across every aspect of store operations. 

Here, too, technology plays a key role. Store teams, for instance, are able to access learning workshops digitally so they can learn at work or at home. “Good training, good tools and good support deliver good results” is how Platovsky puts it. 

Falabella is also intent on ensuring people and profitability can co-exist in greater harmony. When it comes to social responsibility, the retailer is, quite literally, thinking outside of the box.

In Chile, there are around 60,000 people who collect and sell cardboard cartons for recycling as a way to earn money. These people are perhaps one of the most visible indicators of the social inequality that exists within the country. 

Recognising that, Falabella runs an initiative through which stores work to support this marginalised section of society – yet another example of how the business is blazing a trail.

“As one of the nation’s leading retailers, we have a responsibility to do what we can”

Ricardo Alonso, Falabella

In six of its stores, the retailer now works with collectors on a more formal ‘contract’ basis, enabling them to go to branches to collect cardboard waste or arrange for it to be taken to them.

“As one of the nation’s leading retailers, we have a responsibility to do what we can,” Falabella chief executive Ricardo Alonso says. 

As Falabella demonstrates, success is about thinking ahead, and differently, and doing the right thing. Operationally. Responsibly. And the two are not mutually exclusive.

The customer is likely to increasingly want to buy what they believe in, and in what works. Restrictions and complexity will frustrate. Efficient, effective – and ethical – retailing will encourage.

On the evidence of my time with senior executives at this Latin American powerhouse, there are plenty of encouraging signs that Falabella is one department store group that has a bright future.

• Karl McKeever is founder and managing director of Visual Thinking. He visited Chile before lockdown in March. More of his views on Santiago retail can be found in his global retail travelogue podcast at theretailexchange.co.uk