What Is Order Management?

Order management can be described as the process for the collection, processing and and fulfilment of orders that happens in the running of a business. It can include everything from capturing customer data, printing the labels, order routing, returns and in some cases the invoicing and payment – everything from an order being placed to a satisfactory resolution.

In the past, the order management process relied on enterprise resource planning and manually updating static spreadsheets. Nowadays, those processes are outdated and can’t support modern-day retailers and warehouses the same way they used to – they have become an ineffective solution. Even worse, the need for band-aid fixes between different systems and processes can lead to a lack of visibility, figures that don’t add up and headaches that need not be there.

In order to stay ahead of the competition, brands need to have solutions with enough flexibility to scale and meet the needs of your customers and industry. An efficient, reliable order management system is necessary in order to perform at the level that the market now expects.

An order management system (OMS) is able to ensure the automation and integration of the entire system in order to standardize every step of the order journey. E-commerce Order Management software is in place to enable operators to manage and track orders that come from various fulfilment points and arrive through distribution channels. They speed up automation for service providers and collect all the data they have in a single user-friendly interface. Brands are able to offer a consistent customer experience across diverse channels. 

Since E-commerce business and multichannel trading go hand in hand, order management systems have not only become indispensable but have become a new standard requirement if your business has ambition. 

Real-time data is an integral part of an effective, distributed order management system and making good use of it can be a competitive advantage. Data accessible via spreadsheets and the like is inadequate, outdated and often more time consuming and error prone than employing a more modern, integrated solution such as Mintsoft.

What does an order management system do?

Regardless of the size or nature of your business, an OMS must fulfil certain basic functions. How complex you need the OMS to be is completely dependent on the firm and the level at which it operates. B2B E-commerce for example may contain different nuances when compared to FMCG commerce. That’s why certain companies may need more comprehensive systems than others. The basic functions that all levels of OMS will share are as follows:

Tracking

The ability to track and monitor orders may be the most important basic function of an OMS. Once your E-commerce brand starts its growth, it will need a system in place to handle and collate orders.  

Functionally an OMS will allow a streamlined monitoring service for both customer and vendor. TO have regular updates on the progress of shipment for example can alleviate concerns and reduce customer queries.

OMS becomes even more vital when your firm is responsible for sales through multiple channels. Good OMS is able to track and record order details through your webstore, marketplaces, and all other platforms. Having one place to go to look for stock levels, order progress and customer details makes a huge difference when it comes to efficiency and productivity, with the added benefit of drastically reducing errors and increasing opportunities to cross-sell. 

It doesn’t have to be all about digital channels either. Some OMS will also record and handle orders that are placed via phone or in-store if needed. The details of all orders will become visible in one place. Communication between staff will increase meaning order statuses can be checked, relevant changes can be made, and the ability to reach out to customers if there are questions, delays or opportunities will become much easier. 

Inventory Management

When orders are placed and fulfilled for physical goods the stock levels (inventory) will change. If you are selling on multiple websites or have multiple clients sharing space in your warehouse, things can get tricky rather quickly. Inventory management is essential when a rapid flow of goods takes place in a pooled resource environment.

When you aren’t able to accurately measure inventory, effective warehouse management becomes difficult and a whole host of issues can crop up. 

The accepting of orders for products that you don’t have the adequate stock level to fulfil is known as overselling. This can lead to needing to cancel orders that have already been placed by customers. It’s quite unprofessional and if it happens regularly, how many customers will you lose?

Overstocking is the opposite problem whereby you do not want to be short on products and end up wasting valuable warehouse space and capital. By employing such guesswork it is quite likely you will be left with stock that goes to waste as often stock depreciates, spoils or is less in demand as time goes by.

While both the above concerns are easy to imagine, it is harder to imagine the positive effect that having accurate forecasting could do for your business. Without the correct global inventory stock level figures, it’s harder to understand customer order demand. With the numbers in front of you, you can have confidence to put more effort in to your seasonal ranges for example – or instead to prioritise your efforts elsewhere as the case may be.

An OMS will simplify your inventory tracking process. this will mean a more efficient use of resources, the ability to spot problems and opportunities and reduce errors and the lost time and money that goes with them.

Fulfilment

Fulfilment is getting the package from the warehouse to the customer. This usually involves finding the stock, packaging it, arranging for the best delivery options and attaching labels. You might be able to picture warehouse workers with mobile barcode scanners, documenting each step of the process. This is how the data is fed into an order management software system such as Mintsoft. Armed with this data, you will gain total oversight in to each of your orders. You will know how long they take to arrive, where problems are arising and help make lost packages a thing of the past. 

Returns

Nobody is thrilled with the idea of returns but an OMS makes it as painless as possible to deal with them in a way that reduces customer dissatisfaction and eliminates as much wasted time and and effort as possible on the part of the retailer or warehouse manager. Utilising a single software system, you can easily resend or refund with minimum disruption.

How does an order management system work?

An order management system is a digital way to manage the lifecycle of an order. It is able to track information and process each element through order entry, inventory fulfilment, sales and service. The aim of E-commerce order management systems is to deliver products to customers as quickly as possible. They monitor every item in their order from shipment to arrival at their front door, with any returns that might follow. 

Example Order fulfilment process

Each company differs in its approach to fulfilment. This approach may vary depending on the customer, location, return process and seller. Generally speaking though they will all follow a similar outline to that detailed below:

1. A company receives a sales order from a customer. 
2. The order is then entered into the company’s system and the order process begins.
3. Customers will receive notification that their order has been accepted.
4. Said order is shipped to the closest storage centre/warehouse.
5. An employee will pick the order. 
6. The order is prepared for shipping with shipping labels.
7. The order is then shipped.
8. The customer is notified of the delivery being shipped.
9. The order completes its journey at the customer’s chosen delivery location. 

How Order Management Systems enable order fulfilment

OMs are designed to make compliance as efficient, cost-effective and automated as possible. You optimize every step of the order to reduce shipping costs. With increasing data quality, the collection and packaging of OMS becomes more efficient. 

Good operating software should be able to integrate with many of the leading e-commerce tools to adapt to the way your business is run. Most OMs are also able to streamline returns management and credit card processing.

Once an order leaves the warehouse, customers can track its progress until it reaches their door. This tracking is facilitated by OMS. Once an order has been delivered, OMS tracks it and integrates with 3PL, FBA and freight forwarders. When a customer buys an item, the system updates the account, generates an invoice and matches the delivery stickers.

Built for flexible growth

Typically, an E-commerce OMS is built with independent functions separated by individual tasks so each component has the information necessary to facilitate its own work in the overall function of the system. They are designed to interface and integrate smoothly with each other to create a smooth, seamless operation. 

These systems are designed to be scalable, along with plenty of options for freestanding modulus to be integrated into the existing system to provide additional capabilities and functionality. 

Because OMS is designed to act as a shared interference across the supply chain- from shipping and in-store processing to back-end manufacturing and customer capabilities- the interface used through the journey can change in order to fit the needs of its user, as do the capabilities that are attached. 

Streamlined for synergy

OMS is the heart and lifeblood of your operational platforms 

It is centralized and orchestrates processes from various systems to guarantee fulfilment and improved customer order experiences. 

A great OMS will ceaselessly monitor the different systems and channels in order to create seamless communication between systems and improve workflow. In essence, OMS is designed to drastically reduce the margin of error and improve efficiency. 

When an order has been cancelled by customers or retailers, inventory quantities change, or customer’s orders are eligible for drop-shipping from nearby fulfilment centres, the OMS knows immediately. 

Employees are only able to see what is directly in front of them, while an order management system is able to connect and communicate real-time data between each system to reduce errors and make sure no mistakes are made.

It links data together from carriers, drop-ship locations, suppliers, and more to make sure every member in your supply chain is interfacing efficiently and effectively. 

OMS will possess intelligent shipping, inventory management and be able to optimize fulfilment practices so that the company is able to get the orders shipped cheaper and faster. Overall, order management systems will reduce costs all across the board. 

Improved customer satisfaction/ experience

The unique design of order management systems not only provides additional capabilities to internal teams but is integral in creating an exceptional customer experience.

The high demand for personalized order orchestration from customers is not decreasing, and companies have discovered that order management software is able to drastically improve order to fulfilment cycles. 

Its most important feature on the customer’s side is that it will allow customers to track their order status and they will receive updates as to its processing.

Transparency into the shipping and fulfilment process means customers are now able to know when their package is being received, shipped, and delivered as well as any issues or delays that may crop up during these processes. 

If issues do arise with an order, customer support can now be integrated into the OMS which will allow support agents to access cart and order history. If for example, a customer is having issues with completing their order, customer service agents are able to manually go into their cart to solve the issue. If a customer then has questions about the order and calls in, the system is able to communicate the most likely reason they have called to support agents. 

The system is also able to intelligently source orders, meaning that orders can be shipped from the closest fulfilment centre saving on shipping costs and increasing delivery times. It also enables drop-shipping as an option, for stock that is not internally stored can be shipped directly to customers when needed. 

These are some of the capabilities OMS is able to provide but in order to stay ahead it’s important to continually upgrade and improve systems, and provide services that will put you above your competitors.

What is the best Order management system to use?

Every company is different and there are many software solutions available, so the quickest way to find out which is the best for your business is simply to get on a quick call with one of our experts. They will quickly identify your particular needs and if Mintsoft is the right choice to address them.

Companies without OMS in place can struggle to cope once they begin to scale their operations. Order processing can start to break down, data entry takes longer, and critical errors start to pop up more frequently. It’s at this point where businesses should consider looking for an order management system – software specifically designed to centralize order processes across every sales channel and fulfilment centre. This will help to automate the workflow and help control the customers experience. Mintsoft can be a fantastic opportunity for your company to help you manage your growth and automate your processes. 

Mintsoft is a cloud-based order management software system that has been designed from the ground up in order to help you streamline your order processing for those in online retail and 3PL. It’s a great solution to integrate all your orders from various online shopping platforms and multiple sales channels and manage the full dispatch process from picking, packing and shipping. Get in touch and we will show you why we think Mintsoft is the best!