According to industry experts, one of the biggest issues in the integration of online shopping and physical stores isn't technology but identifying where to assign sales credit or commission for a purchase that is made online and fulfilled in-store.
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The problem has been known to encourage bad behavior in store managers and sales associates, who sometimes stash popular items to sell in the store—and to ensure they get credit for the sale.
"The single greatest obstacle to what the shopper wants, in my opinion, is not technology [or] merchandise, but the issue of revenue recognition," said Jon Stine, retail industry director at Cisco Consulting Services.
Retailers are reluctant to discuss the problem because it's complicated and takes a number of approaches, according to Vincent Quan, an associate professor at the Fashion Institute of Technology who has experience at Saks Fifth Avenue.
Some companies split the sales credit 50-50 between the Web operation and the store, while others attribute the sale to the store that supplies the inventory, Quan said.
Another option is to credit the sale to the Web, assuming that the associate's work is limited to pulling the already-selected inventory from a stockroom. While that method may seem logical, removing inventory from the store and attributing the sale to the Web creates an accounting imbalance.
"The sale is one piece—the inventory's another," Quan said.
Not a new problem
Although the assigning of sales credit was a hot-button topic among exhibitors at the recent National Retail Federation convention, it dates back about 10 years, to when the now-defunct Circuit City allowed in-store pickup for online orders, said Forrester Research analyst Sucharita Mulpuru.