Conceptual background and basic terminology

This section structures the research field by defining OC distribution, which is required before the related literature can be identified and analyzed. We compile current concepts of distribution in OC retailing and define basic terms.

We focus on the distribution concepts of retailers who operate both bricks-and-mortar stores and a distance channel, and refer to these retailers as "omni-channel" retailers. In practice, several different terms and definitions have been developed for retailing in multiple channels. Among others, "multi-channel", "cross-channel", and "omni-channel" are often used interchangeably and without clear distinction. However, Verhoef et al. claim that recent concepts from literature and practice tend towards seamless OC retailing, where the boundaries between physical and online retailing disappear  This definition of "omni-channel" is based on the customer's point of view. It underlines the difference between it and "multi-channel", where distance and bricks-and-mortar retailing do not overlap from a customer's perspective, even though a retailer operates in both fields. By this definition, the channels are not physically linked in multi-channel retailing.

Because we want to get the broadest possible view of the logistics systems relevant in practice, we refer to distribution in multiple channels as "omni-channel" distribution, since this is the overarching term and most advanced concept. Consequently, we investigate the structures and processes needed for OC distribution, where retailers aim to integrate operations and physical product flows to provide a seamless shopping experience. The overarching idea is to analyze the distribution systems that enable customers to complete a purchase and receive orders from any channel they choose. For example, a customer can buy a product in a webshop and choose either home delivery or in-store pickup, and may have similar options for product returns. Since we concentrate on operational distribution systems, we do not make a distinction between the customer interfaces for shopping, e.g., in-store, webshop, mobile commerce, catalog, or phone. We investigate how operations and logistics function for physical stores, the direct-to-customer channels, and the links between channels.

An OC retailer's distribution system encompasses not only the delivery of goods to stores and customers, but also backward distribution concepts, since products purchased online require options for customers to return products, if they do not want to keep them. As seen from the perspective of an OC retailer, the forward (1) and backward (2) distribution systems must therefore be taken into account.

(1) The forward distribution system is usually characterized by its sources (=dispatching locations), destinations (=points of reception) and associated links. To understand distribution systems within OC retailing, we need to consider the different types of sources (e.g., DCs and stores) and destinations (e.g., stores and customers) in the physical distribution structure, as well as possible delivery processes and modes, i.e., shipments to customers and stores.

(2) The backward distribution system encompasses the physical flow of product returns from the customer to the retailer, and the locations where returns are processed (e.g., return centers). Backward distribution therefore covers shipments from customers and stores. An alternative name for this dimension would also be "returns" or "reverse logistics".