How Retailers Use Order Management Systems

  • Retailers coordinate distribution across multiple channels using order management systems.

  • Consumers value visibility into orders, and an OMS can give both the shopper and the retailer information on delivery schedules and interruptions.

  • The cost of operating unnecessary systems is referred to as the “e-commerce tax,” which can exceed the benefits of growing e-commerce sales.

  • Retailers can reduce their e-commerce tax by replacing the order management component inside of “monolithic” platforms with fabric OMS.

Retailers use order management systems (OMS) to control logistics around all of their orders across multiple channels. That means that all sales, both digital and in-store, are processed in the OMS to facilitate efficient order management. In this era, a robust retail order management system is an essential part of any retail seller’s operations.

Retailers are under more pressure than ever to provide a seamless, omnichannel experience. When people go to the store, more than a third are using omnichannel features like buying online and picking up in person. That expectation for smooth service across digital and in-store channels means that any retailer needs to use a robust system to manage sales, like an OMS.

Multi-Channel Coordination and Insights

Consumers are shopping online more than ever before. The online share of total retail sales has recently increased sharply, so it’s essential to make sure that retailers can sell effectively across both in-person and online channels.

Inventory management

A retail order management system lets the seller see inventory across all physical locations. If stock levels are getting low in one location, administrators can see that data and respond to it on the same platform. The insights from the OMS can then let retailers conduct store order management over which sites need new stock and what the best route for restocking would be.

Instead of coordinating a store’s order management on a location-by-location basis, retailers using an OMS can look at demand patterns and distribute more intelligently. That can inform where a business builds its next distribution center or even let the retailer anticipate future demand.

Consumer visibility

Using an order management system in retail also means that vendors can give consumers better visibility into their orders. Control over delivery ranks as one of the most important features for consumers buying from retailers. That means buyers want to know where their order is, when it will come, and even what choice they have over the delivery time.

Visibility into the delivery process also builds the consumer’s trust in a brand. While an emergency can create a snag that slows down an order, some retailers don’t show the shopper where their order is or tell them when it’s expected to arrive. By tracking an order at every step, an OMS lets retailers keep their shoppers in the know and confident in the brand.

Avoiding the “E-Commerce Tax”

With the rapid rise in the importance of e-commerce, it’s no wonder that retailers are trying to expand into it as fast as possible. Unfortunately, that means that they’re often choosing to do so in an inefficient and cost-intensive way. Instead of carefully planning out their e-commerce strategy, retailers are quickly adding e-commerce tools that may be redundant or even incompatible with one another.

The cost of operating all these unnecessary systems is referred to as the “e-commerce tax,” and it can even exceed the benefits of growing e-commerce sales. Instead, an OMS can reduce costs with comprehensive e-commerce modules. The result is the same capacity for inventory management and consumer visibility, all without incurring the e-commerce tax.

An OMS can replace inefficient store order management features within a few different platforms you may have heard of. You could reduce your e-commerce tax by implementing the strangler fig pattern, swapping in an “OMS microservice” to replace the order management component inside of one of these “monolithic” platforms:

  • Salesforce Commerce Cloud: Commerce Cloud is Salesforce’s B2B and B2C e-commerce platform. While it connects to Salesforce’s other tools easily, some users find it difficult to scale due to its rigidity.
  • Shopify Plus: Shopify has a headless order management system that allows for more flexibility than some other, less scalable platforms. Still, it has limitations due to being a one-size-fits-all solution.
  • Oracle ATG: Oracle ATG is a legacy e-commerce system that also supports order management. Because it isn’t cloud-native and has an older set of features, some customers are finding it easier to migrate onto a microservices-based system instead.
  • BigCommerce: Like Shopify, BigCommerce lets you conduct headless order management with greater flexibility than other platforms. That flexibility makes it easier to replace as a perfect candidate for the strangler fig strategy for updating your platform.

These are bulky, expensive programs that can be rigid and difficult to use. A more agile, microservices-based approach can tune to your exact requirements, all while reducing the e-commerce tax you pay for running more complex and rigid order management systems in retail.

Topics: Product
Chris Meabe

Tech advocate and writer @ fabric.

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