Going digital is now a must for fashion brands, but it can prove to be a complicated and costly business. Fadi Amoudi, founder of the MENA region\u2019s first robotic-driven fulfillment center, shares his advice on the pick, pack and deliver side of e-tailing<\/p>\n
Even before the COVID-19 pandemic, e-commerce digital fashion and beauty sales in this region were already growing at an accelerated rate. According to a report published by\u00a0Bain & Company<\/a>\u00a0in 2019, there was an annual growth rate of 27% between 2017 and 2019 in digital sales in the Middle East, with UAE and Saudi Arabia leading the pack. Industry insiders say that e-commerce growth may have doubled last year in the fashion segment thanks to the pandemic. Now that consumers have become used to just pressing a button, shopping digitally has become a way of life for many. This leaves small fashion brands with no choice but to adopt a \u201cdigital first\u201d approach to their business. While customers think that all it takes is a click of a button, for fashion brands the logistics behind digital can be complicated and costly. They have to figure out warehousing, processing, packaging, last mile delivery and returns. This is where a fulfillment agency can come to a small fashion brand\u2019s rescue.<\/p>\n About two years ago, Amoudi moved to Dubai with many years of experience in the FMCG business. He has lived in Beirut, Saudi Arabia and Miami, and hoped to open an\u00a0innovative grocery-based e-tail business, and so began a feasibility study. He quickly found two major stumbling blocks \u2013 storage of products needs location and proper care and also manpower, as people need to prepare the orders. This led him to research fulfillment. Amoudi describes this as \u201call the backstage work that goes on for digital: pick, pack and deliver.\u201d He discovered that\u00a0there was no robotic fulfillment center in the MENA region and embarked on a mission to create one. His vision: ensuring end-to-end services,\u00a0IQ Fulfillment (IQF)<\/a>\u00a0would help address logistical challenges experienced by SMEs. The company currently covers UAE, Saudi Arabia, Oman and Bahrain and is looking to expand throughout the region. IQF has the potential to process 12,000 robotic orders daily, delivering a 99.9% accuracy rate. Currently,\u00a0IQF<\/a>\u00a0is doing a few thousand orders a day at its 43,000-square-foot Dubai warehouse, with a staff of just 12 people \u2013 the rest is done by robots.<\/p>\n The company takes care of everything that happens from the minute a customer checks out. Amoudi is already working with CTZN Cosmetics, sports apparel brand Bia and colored lenses provider Eyecandy, and he\u2019s open to working with companies that do multiple orders in a day as well as those that are just starting out and only receive a few orders in a week. \u201cIn theory, all you need is your e-commerce shop and trade license, and you are ready to go digital.\u201d Of course, in reality, it takes a lot more than this. His advice to fashion brands looking to go digital is to first study the market, understand who your customer is and find out what it is they need. Then comes adding a buffer for hidden costs. For example, he finds that 70% of customers still prefer \u201ccash on delivery.\u201d This leads to returns \u2013 Amoudi estimates about 30% of fashion goods are returned, and while it costs the customer nothing, the brand still has to pay for the fulfillment and delivery charges.<\/p>\n \u201cWhat is most crucial is marketing and customer experience,\u201d says Amoudi. Of course, a brand does need to make an investment in stock \u2013 and he advises you have two pieces available in a size of every stock. \u201cSometimes having a sold-out product can work in your favor \u2013 being sold out in fashion tends to make things more desirable, but it needs to be available again in a short time span, or customers will become annoyed,\u201d he says.\u00a0 Which is why he suggests you start with a limited offering.<\/p>\n He believes that direct to consumer is the way forward for all fashion labels. \u201cThink of your digital platform, be it a website or app, as your online flagship store.\u201d It is here that customers experience the touch points of the brand, from navigating the site to the packaging. \u201cIt must be a lovely experience and those small things like a personal thank you note make\u00a0all the difference,\u201d he says. He recommends brands spend time on this aspect of the business and partner with companies such as his for the logistics. \u201cThis way you are not wasting your time on processes that take time and are not your forte.\u201d Though he does say today all fashion brands need to have an understanding of the processes of fulfillment and delivery.\u00a0 \u201cThis is as important as the creative process today.\u201d<\/p>\n