Optimising Online Sales Fulfilment with OMS

As an online retailer, you're probably familiar with the feeling: Orders start pouring in, and suddenly, you're swamped with the task of managing them all. Keeping track of orders in the world of eCommerce can quickly become overwhelming. This is where Order Management System (OMS) technology steps in to lend a helping hand.

But what exactly is an OMS? It's a digital solution designed to streamline the process of managing and fulfilling sales orders. From the moment an order is placed to its delivery, an OMS tracks its journey, ensures your inventory records are always up-to-date, and provides valuable insights into your order processing.

By keeping tabs on orders, maintaining real-time inventory information, and offering insights, an OMS serves as a catalyst for streamlining operations and elevating customer service standards. This not only boosts efficiency within your operations but also enhances the overall customer experience.

Throughout this article, we'll take a deep dive into the realm of OMS. You'll discover why integrating this technology into your business is crucial for optimising sales in the eCommerce landscape, and how you can leverage its capabilities to your advantage. 

Let's get started!

What is an Order Management System?

At its core, an OMS is a software application that takes charge of order processing, fulfilment, and inventory management. Picture it as the nerve centre of your eCommerce enterprise, providing a unified platform for handling orders and inventory across various channels, from online marketplaces to brick-and-mortar stores.

An OMS truly shines when it comes to navigating market dynamics. Let's say you're running a popular online clothing store. Suddenly, a particular item becomes the hottest trend of the season, triggering a flood of orders. Without an OMS, keeping track of available sizes and colours could become a nightmare, potentially leading to order cancellations and disgruntled customers. 

However, with an OMS, you receive real-time updates, enabling swift action—whether it's restocking inventory, updating product availability, or suggesting alternatives to customers proactively. This scenario illustrates how an OMS empowers you to make informed decisions promptly, elevating customer satisfaction and streamlining operations.

But an OMS isn't just about day-to-day operations; it's a strategic asset. The wealth of data it generates allows you to spot trends, identify bottlenecks, and even forecast future demand. For instance, if your OMS data indicates that a particular product consistently sells out rapidly, you might opt to increase its stock levels or negotiate expedited delivery with your supplier.

In the realm of eCommerce supply chain management, the significance of an OMS cannot be overstated. By putting you in control of your orders and inventory, an OMS lays the groundwork for efficient operations, delighted customers, and a finely-tuned supply chain—paving the way for a thriving eCommerce venture.

Key Components Powering Order Management Systems

At the heart of an Order Management System (OMS) lie several key components that fuel its operational prowess: streamlined order processing, optimised inventory management, and seamless shipment fulfilment.

But an OMS doesn't stop there. Its true strength lies in its ability to seamlessly integrate with other critical systems. This includes your eCommerce platform, payment gateway, and shipping carriers. These integrations ensure a cohesive operation, where every component works in harmony, bolstering both your efficiency and customer satisfaction.

When these components operate in sync, an OMS transforms into a formidable tool for managing eCommerce supply chain operations. Let's look at the key components that power a typical Order Management System:

1. Order Processing

At the core of an OMS lies its prowess in handling orders from diverse channels. Whether they originate from your website, third-party marketplaces, or physical stores, the OMS serves as the central hub, consolidating these orders into a unified system for seamless management.

A robust OMS boasts automated functionalities to validate order details, verify inventory availability, and facilitate payment transactions—all in real time. This automation minimises manual errors and expedites order processing, thereby elevating customer satisfaction. Moreover, an OMS is engineered to manage high order volumes effortlessly, smoothly scaling up during peak periods or promotional events.

2. Inventory Management

In the realm of inventory management, an OMS stands as a vigilant guardian. It diligently monitors stock levels across all warehouses and stores, furnishing you with a real-time snapshot of your inventory status. Whether a product's stock is dwindling or accumulating, the OMS promptly alerts you, facilitating timely decision-making. This could entail initiating restocking procedures, reallocating surplus inventory, or even pausing specific marketing initiatives.

Furthermore, the system meticulously tracks inventory in transit and returned items, ensuring comprehensive oversight of all stock movements. By offering a holistic view of your inventory, an OMS helps mitigate the risks of costly stockouts and overstocks, promoting optimal inventory turnover.

3. Shipment fulfilment

The journey of every order, from the warehouse to the customer's doorstep, is carefully guided by the OMS. It kicks off the fulfilment process, which encompasses tasks such as product picking, secure packaging, and efficient shipping. A sophisticated OMS goes a step further by optimising these operations, suggesting optimal routes for pickers and cost-effective packing materials.

Moreover, through seamless integration with multiple shipping carriers, the system empowers you to select the most suitable shipping options based on factors like cost, delivery speed, and carrier reputation. Once the order is dispatched, the OMS diligently tracks its progress in real-time, continuously updating its status and furnishing customers with precise tracking information. This level of transparency not only manages customer expectations regarding delivery times but also enhances overall satisfaction.

4. Integration with Other Systems

For an Order Management System (OMS) to deliver its full potential, seamless communication with other components of your eCommerce infrastructure is essential. This entails integration with eCommerce platforms, Customer Relationship Management (CRM) systems, payment gateways, and shipping carriers. By establishing such interconnectivity, data can flow effortlessly across these systems, minimising the need for manual intervention and enhancing data accuracy.

Integration with your eCommerce platform allows the OMS to synchronise order data seamlessly, ensuring a cohesive flow of information. Similarly, integration with payment gateways streamlines transaction processing, while collaboration with shipping carriers facilitates efficient order delivery. These integrations create a cohesive ecosystem where data moves seamlessly between systems, reducing manual workload and mitigating errors.

5. Reporting and Analytics

In addition to its core functionalities, a robust Order Management System (OMS) boasts built-in analytics capabilities. It churns out comprehensive reports on a myriad of performance metrics, including order volume, fulfilment speed, return rate, inventory turnover, and beyond. These insights serve as invaluable tools for pinpointing bottlenecks, deciphering customer behaviour, forecasting demand, and formulating strategic initiatives to foster business growth.

By delving into these analytics, businesses gain profound insights into their operational efficiency and customer interactions. They can identify areas of improvement, fine-tune processes, and tailor their offerings to meet evolving consumer demands. Moreover, armed with data-driven insights, businesses can make informed decisions to optimise resource allocation, enhance inventory management practices, and capitalise on emerging market trends.

How does an Order Management System work?

 An Order Management System (OMS) serves as the backbone of a smooth shopping experience and efficient fulfilment process. Upon receiving an order, the OMS automatically assigns it to warehouses based on predefined rules and factors such as product availability and delivery details. 

This automation minimises errors and delays, enhancing accuracy, efficiency, and customer satisfaction. In essence, the OMS optimises order processing and fulfilment, ensuring a seamless experience for both businesses and customers alike.

Here's a breakdown of how the Order Management System (OMS) navigates through the complex tasks of managing orders:

Step 1: Browsing a product

The journey begins when a customer visits the product detail page. Here, they can explore available delivery methods and corresponding expected dates (referred to as availability to promise) before adding the item to their cart. This transparency instil confidence in the shopper, as they swiftly grasp the expected delay in receiving their product.

Step 2: Shopping cart/checkout

The shopper proceeds to the cart, where they find the availability to promise for the items in their cart. During checkout, they select their preferred delivery method and complete the payment.

Step 3: Order placement

Upon order placement, the OMS springs into action, coordinating the orders and assigning them to the appropriate warehouse while notifying relevant personnel in real-time. Centralising order information within the OMS grants managers enhanced oversight over order fulfilment, freeing up time for customer engagement.

Step 4: Order preparation

With each new order, staff oversee the pick and pack process. If shipping is necessary, the system can automatically generate shipping labels. Once the order is prepared, the stock of each item is updated in real-time. If an item is out of stock, the OMS promptly activates and assigns the order to an alternate warehouse. The shopper receives automatic notifications from the OMS regarding each change in the order status: from support waiting to in preparation, ready for pickup, ready to be shipped, picked up, and shipped. To streamline integration, the order management system communicates directly with the payment system to process payments automatically based on the order status.

Step 5: Return management

If a return or refund is required, the OMS simplifies the process by offering a refund option and automatically processing refunds while overseeing the return of products to the warehouse. This simplifies returns and enhances the overall customer experience.

What are the most common Order Management System features?

Here's an overview of some key features commonly found in an OMS:

1. Multi-Channel Management

An OMS excels in managing orders across diverse transaction channels, encompassing online platforms, physical stores, and contact centres. This feature ensures a seamless and comprehensive approach to order management across various geographical areas and currencies, fostering a unified and efficient retail strategy.

2. Unified Stock

Central to effective inventory management, the Unified Stock feature consolidates inventory data from warehouses, brick-and-mortar stores, and drop-shippers. This aggregated stock information is then made accessible across all sales channels, including Point of Sale (POS), e-commerce sites, and instant messaging platforms, promoting efficiency and accuracy in inventory management.

3. Click and Collect 

   — Express C&C Offers customers the convenience of swift pickup within one or two hours from a store, leveraging real-time store inventories.

   — Ship-to-Store C&C Allows customers to place online orders and collect them at a physical location, with inventory replenishment seamlessly supported by the unified stock system.

4. Ship from Store 

Enhances delivery efficiency by leveraging store inventories to fulfil online orders. This not only shortens delivery times but also has the potential to reduce shipping costs.

5. Orchestration Rules 

Intelligent orchestration algorithms are employed to assign orders optimally to fulfilment centres or points, streamlining logistics and maximising resource utilisation.

6. Availability to Promise (ATP) 

This real-time feature provides accurate availability statuses, presenting feasible delivery methods for specific products or entire carts. It considers various data parameters, including stock levels, warehouse locations, delivery methods, and transportation logistics.

omnichannel-return">7. Omnichannel Return 

Streamlines the return process by allowing customers to return purchases seamlessly, regardless of the original sales channel used for the transaction.

8. Customer Service 

Offers real-time management of the entire order lifecycle, enhancing customer experience through prompt and efficient service.

9. Reporting 

Facilitates the extraction of comprehensive data regarding the order lifecycle, aiding in the reconciliation of funds among all stakeholders involved in the order management process.

10. Analytics 

Implements real-time tracking of order management performance, utilising live data to improve strategies, identify bottlenecks, and enhance overall efficiency.

The Role of OMS in Streamlining Supply Chain Operations

Let's explore how an Order Management System (OMS) can play a crucial role in streamlining and enhancing efficiency in eCommerce supply chain operations:

1. Finding the Perfect Inventory Balance

For eCommerce businesses, maintaining the right balance of inventory is essential. Stockpiling too much inventory can lead to financial losses from unsold goods, while having too little can result in lost sales opportunities. This is where the OMS steps in.

An OMS offers a comprehensive, real-time overview of your inventory spread across various warehouses and sales channels. This visibility allows you to fine-tune your inventory levels to match demand, preventing costly overstocking and frustrating stockouts. Moreover, having this enhanced visibility enables strategic decision-making, such as identifying slow-moving items or preparing for seasonal fluctuations in demand.

2. Enhancing Order Processing Efficiency

When it comes to the fast-paced world of eCommerce, efficient order processing is paramount. Customers expect speed and accuracy, and any delays or mistakes can lead to dissatisfaction. This is where the OMS steps in to streamline the entire order processing cycle.

From the moment a customer places an order, the OMS takes charge. It meticulously tracks each step of the process, from payment confirmation to invoice generation, warehouse picking, packaging, and final delivery arrangements. By automating these complex tasks, the OMS minimises the chances of human error, expedites the process, and ensures that every customer receives their order promptly and accurately.

3. Improving Customer Experience

Effective communication is essential for fostering trust and loyalty with customers. Providing timely updates on order status and delivery tracking is a significant aspect of this communication strategy.

The OMS takes centre stage in this regard by sending regular updates to customers regarding their order progress and estimated delivery times. This transparency not only builds trust but also enhances the overall shopping experience for customers. A satisfied customer is more likely to return, thus fostering sustained business growth.

4. Unifying Sales Channels

Expanding eCommerce businesses often find themselves managing sales across multiple platforms, from their own website to mobile apps and third-party marketplaces. Juggling orders from these various channels can be overwhelming.

Enter the OMS, the solution to this complexity. It brings together orders from all platforms into a single, centralised system, ensuring consistency in inventory management and order processing across the board. This integration streamlines operations and ensures a seamless customer experience, regardless of where the sale originates.

Conclusion

As supply chain operations become more intricate, businesses are on a constant quest for new tech solutions to streamline their processes. Enter Order Management Systems (OMS), which have surfaced as a game-changer in recent years. OMS automates order processing, inventory management, and fulfilment, leading to better efficiency, cost savings, and happier customers. Think of it as the nerve center for eCommerce operations, providing real-time updates and insights to help you make smart decisions and keep customers satisfied.

The Order Management System isn't just a tool; it's a crucial ally in optimising supply chain operations. By providing real-time insights into inventory levels and order statuses, it helps businesses minimise stockouts and overstocking, ultimately enhancing efficiency and profitability.

In conclusion, the OMS serves as a linchpin in eCommerce operations, harmonising sales channels and empowering businesses to meet customer demands effectively. Its integration capabilities streamline processes, leading to enhanced customer satisfaction and operational efficiency. Embracing an OMS is not just a choice; it's a strategic imperative for modern eCommerce success.

Embracing Order Management Systems (OMS) is the way forward for businesses navigating the complexities of eCommerce. By automating processes and providing real-time insights, OMS boosts efficiency, cuts costs, and keeps customers happy. It's the key to optimising supply chain operations and gaining a competitive edge in the market.