How To Improve Your E-Commerce Order Management Process

Patrick Wong

Content writer @ fabric. Previously copywriter @ Liquid Lab Solutions.

June 22, 2022
ecommerce-order-management-process
Summary
  • An order management system (OMS) plays a pivotal role in streamlining the e-commerce order management process by providing a centralized platform to manage orders, inventory, and fulfillment.

  • Automating key order management processes with a modern OMS results in improved speed and accuracy and can vastly improve the e-commerce customer experience.

  • By choosing an OMS that’s built with omnichannel capabilities, businesses can improve inventory accuracy on PDPs, monitor KPIs, process orders quickly, and offer one-click returns.

  • You can leverage fabric OMS to get started on streamlining your e-commerce order management process.

Improving your e-commerce order management process begins with automating your sales systems. By doing so, you can handle customer orders, prepare invoices, and ship them with speed and accuracy. In today’s highly competitive e-commerce environment, fast shipping largely influences purchase decisions and plays a pivotal role in helping businesses meet their customers’ expectations.

While there are many businesses that continue to rely on manual e-commerce data entry, human errors are inevitable and are some of the leading causes of business data loss. The repetitive process of entering key values into Excel spreadsheets is time-consuming and makes it extremely difficult to trace errors.

However, a modern order management system (OMS) application can eliminate human errors by completely replacing manual processes and spreadsheets with fully automated software. In this article, we’ll explore several ways you can streamline the e-commerce order management process and create an improved customer experience for consumers.

The E-Commerce Order Management Process

The order management process involves a series of steps that a business follows to fulfill an online purchase. After a purchase is made online or from a different sales channel, it sets off a chain of communications that involves multiple other services.

For example, the typical workflow goes like this:

  1. An order is placed on an e-commerce site, mobile app, or other digital sales channel.
  2. The payment is validated through a payment gateway and the order is recorded and accepted through an OMS.
  3. The warehouse receives the order from the OMS or warehouse management system (WMS).
  4. The product is picked, packed, and shipped.
  5. The order is delivered to the customer.
  6. If the customer wants to return the order, a refund and return process is initiated.

Six Ways to Improve the E-Commerce Order Management Process

1. Choose an OMS with omnichannel integration

A modern OMS with omnichannel capabilities can integrate multiple sales channels into one dashboard where you can track and monitor customer orders. For example, if you’re a merchant on both eBay and Amazon or any other sales channel, you’d be able to aggregate orders into a single source of truth with a bird’s eye view of all customer purchases.

An API-powered microservices platform offers omnichannel fulfillment capabilities, faster order processing, better accuracy, greater visibility and control, higher productivity, and better inventory management. Companies that attempt to utilize a manual system to create a superior post-purchase experience may run into difficulties when trying to scale.

2. Improve inventory visibility and availability with an OMS

A modern OMS helps to monitor and update inventory availability across the entire retail supply chain, in real-time.

Not only would you gain complete visibility into available inventory levels across all sales channels, fulfillment centers, and customer service channels, but you would also be able to display exact available-to-promise (ATP) quantities of stock on your storefront with an inventory availability storefront API endpoint.

ATP is the projected amount of inventory a business has in stock that’s ready to sell and that isn’t allocated for existing customer orders. It helps businesses keep enough inventory available to be sold, but also anticipates future requirements using data-based forecasts. The goal is to minimize costs incurred from overstocking or understocking.

3. Include detailed product information

85% of customers agree that product information and images influence their purchase decision. To improve conversion rates, companies need to provide as many details as possible about the products on their product detail pages (PDPs).

An optimized PDP should include information about available item units, shipping options, costs, estimated delivery date, and personalized recommendations. All this information helps customers know what to expect and helps to answer any questions they may have regarding their purchases.

4. Monitor performance metrics

An OMS application collects and stores order information into one centralized system. Order management key performance indicators (KPIs) are used to track and analyze the success of the order management process. By measuring KPIs, businesses can learn how to improve particular processes to boost performance. Some common KPIs used to measure business operations within OMS software include:

  • Cost per order: The total costs incurred from fulfilling one order.
  • Rate of returns: The percentage of products returned by customers.
  • Order fulfillment cycle time: The timeframe between when a customer places an order and receives it.
  • Perfect order rate: The percentage of how many orders you've completed without returns or issues.

5. Manage complexity with DOM and advanced order routing

As businesses grow and have larger and more complex e-commerce operations, they require robust solutions for increasingly sophisticated order management processes. For example, a modern OMS with distributed order management (DOM) capabilities can support distributed commerce models, including newer buy-online-pickup-in-store (BOPIS), ship-to-store (for store pick up or replenishment), and store fulfillment (as mini distribution centers) models.

Meanwhile, advanced order-routing and logic-based rules can find optimal fulfillment locations to ship orders from—helping to make sure orders are delivered within set times and costs. With a modern OMS, the logic (or business rules) can prioritize picking facilities by distance or ranking. It can also be managed with configuration, rather than code, and the data can be pulled from sources like inventory data, product data, order data, and facility data as well.

6. Simplify the returns process

Returns are inevitable. Thus, it’s important to have a seamless return system to optimize reverse logistics. 92% of customers who return their items say they are more likely to patronize the same business if the return process is simple.

Modern OMS software gives retailers the ability to offer instant refunds by using an easy return and automated refund process. In addition to creating and tracking reason codes for returns, cancellations, delays, and exchanges, businesses should also set up returns policy settings that automatically enforce business rules when processing returns and refunds.

Patrick Wong editor Content writer @ fabric. Previously copywriter @ Liquid Lab Solutions.

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