Viare head of sales and partners, Jared Telling, discusses why the retail store model is at a crossroads in 2026.
Rising delivery expectations and margin pressure are forcing retailers to redefine stores as fulfilment hubs, experience destinations – or strategically both.
Thirty years ago, I was running the music department at David Jones in Melbourne, back when retail was simpler, no ecommerce or other online channels, just stores. The customer experience was simpler and easier to control.
Fast forward to today and retail has evolved. Retailers have websites and they’ve had to connect online and in-store to legacy systems, which as we all probably know can have its challenges. There are now multiple touchpoints in the customer journey and omnichannel now has a big focus to ensure customers have a seamless experience across online and in-store.
This shift creates a challenge for retailers. Do you optimise stores as fulfilment hubs, efficient, cost-controlled, and integrated into omnichannel logistics? Or do you invest in stores as experience destinations, differentiated environments that justify physical presence through engagement and brand value?
Challenge 1: Optimise stores as fulfilment hubs
In Australia, where distance can turn delivery into a margin killer, the ability to ship from the closest store offers a strategic advantage. Sending orders from a central DC that’s far from customers can add significant time and cost, which can kill margins and the customer experience.
Australia Post reports that 69% of shoppers want a range of delivery options at checkout, and 26% expect same- or next-day delivery when something is urgent. Furthermore, 85% of Australians say reliable delivery will be the number one factor in trusting online retailers over the next five years. If your fulfilment model is anchored to a single DC, then those expectations can become expensive and difficult to meet.
Activating Store fulfilment enables orders to be routed to the closest store with stock, improving dispatch times and reducing freight cost. Store inventory that once sat idle becomes sellable online, this improves product availability, extends the online range and reduces clearance and excess stock. Other advantages also include; the ability to leverage staff during downtimes, and removes the dependency on a DC.
Starshipit revealed in their latest report that retailers are utilising ship from-store to reduce shipping costs by 34.8% and delivery times by 31.9%, which is a huge competitive advantage.
Challenge 2: Invest in stores as experience destinations
The experience argument is equally compelling. In categories where touch, trial and advice drive confidence (e.g. beauty, premium fashion, homewares), investing in the in-store experience makes sense.
But experience-first strategies have blind spots. They’re capex heavy, hard to attribute, and can unintentionally squeeze back-of-house space just as customers demand more fulfilment choice. Investing only in the store experience can be risky and in competitive markets, speed and price can be the advantage.
Click & Collect: the bridge with measurable ROI
Click & Collect is where fulfilment and experience stop being opposites. Customers now expect to be able to collect orders in-store, and we’ve seen retailers who don’t offer this option lose sales to competitors.
Typically, we see click & collect contributing to an uplift of 20-30% in revenue due to in-store upsell and it goes without saying that this also drives customer loyalty and repeat purchases. For retailers this provides a real win, lower last‑mile delivery cost and an opportunity to increase sales and reduce costs, which in today’s challenging market this is extremely important.
A flagship store that looks incredible but can’t support pickup, fast order processing or easy returns risks becoming a beautiful dead end in an omnichannel journey.
Why the smartest retailers stop treating it as an either/or
Omnichannel customers are simply worth more. A Harvard Business Review study of 46,000 shoppers found omnichannel customers spent about 4% more in-store and 10% more online than single‑channel customers, and spending increased as more channels were used. Store fulfilment and experiential design are two ways to add (and connect) those channels.
In practice, the winning play is to assign roles across the network. Some locations should be high‑velocity pickup/fulfilment nodes that keep delivery fast across big distances; others should be brand flagships that deepen loyalty.
The strategic question isn’t what stores are, it’s what stores should be and whether your operating model makes fulfilment invisible and the experience memorable.
This is a partnered content series with Viare and eStar.