What is Order Management System
LAST UPDATE: JUL 6, 2022
6 minutes reading
What is OMS?
An order management system is a platform that helps businesses to manage orders and inventory. it automates the order-to-cash process, and tracks the order process along its workflow from sales quotes to placing order till fulfillment, and shipment.
Order management systems can streamline order processes, shipments and returns.
It touches nearly every facet of your business operations helping companies to ensure more accurate inventory levels, eliminate manual errors, and alert you to avoid exposure to the two biggest problems: stockout and overstock.
Moreover, the order management system tracks sales across different channels and selling platforms, and improves business’s cash flow and maximizes profitability, helping businesses to focus on growth and market demands.
Using an order management system not only tracks sales records, and inventory volume smoothly, but also helps businesses to ensure that all customers’ orders are filled in a timely manner. Therefore, this can boost the customer experience and protect the company reputation as well as maintaining customer satisfaction which is a key to long-term success in business.
Order management systems can work for any size of businesses whether it is B2B and B2C business.
The Importance of Order Management System
With the continued growth of ecommerce at an impressive rate, an order management system becomes increasingly important because it is designed specifically to save businesses time by automating the order process, eliminating manual errors, and increasing efficiency and accuracy.
Using order processing automation software helps businesses to fulfill their goals in sales and revenue creating a streamline flow of the sales process. As a result, business owners can focus on growth, and ensure customer satisfaction.
The Order Management Process: Step by Step
- The order is placed
- Warehouse processing
- Reconciling the order
- Shipping the order
- Post-sales follow-up
Order management software programs, in general, follow a series of synced steps which help to automate the order process and fulfill customer orders accurately. This creates a seamless order-to-cash flow process.
As a result, orders are fulfilled faster, and businesses are growing quicker.
Here are the end-to-end order fulfillment steps:
1. The Order Is Placed
It begins when your customer places an order in-store, or through your own website, or even over the phone with a live customer services representative.
Then, a customer profile is created, the details are then stored in your order management system, including the purchase history, the volume of order, and payment and preferences. Finally, the customer order is sent to the warehouse.
2. Warehouse Processing
As soon as the order arrives at the warehouse, the inventory is checked by a warehouse management team, and the items then picked from the stock using SKU or barcode – if it exists- and added to the order.
In case of low inventory or stockout, the order management software automatically places a purchase order with a notification sent to the customer that there may be a delay.
3. Reconciling the Order
The order is then sent to the accounting department or automatically synced with your cloud accounting software to be recorded, after, in the ledger as either cash sales or accounts receivable.
After the sale is logged, an invoice is generated and a receipt sent to the client. Lastly, the payment is recorded.
4. Shipping the Order
As the order is picked from the warehouse, it is packed carefully by the packing team and shipped via third-party shipping service.
Your order management system will send your customer a notice that the order is shipped, in addition to a tracking number and an estimated delivery time.
5. Post-sales Follow-up
Once the order arrives, your customer service team follows the Post-sales process with the customer, they also oversee on asking them how they liked the items, or if they want to refund or replace the order.
What does OMS software do?
1- Order Management
The good order management system records and processes orders placed in-store or over the phone or even through your webstore, marketplaces, and other platforms.
It receives order information via all channels of sales and tracks them making all details of orders centralized in one place, so you can check order statuses, and view the order workflow step by step.
2- Automate Order Fulfillment
eCommerce merchants can rely on an OMS to automate the entire process of order fulfillment.
It will streamline many logistics processes including picking orders and routing them to the right warehouse, auto printing shipping labels, shipping orders and much more.
Such efficiencies are important to reduce delayed orders and reduce the cost to ship products.
3- Manage & Track Inventory Levels via All Channels
An order management system will simplify the inventory tracking process, whenever your customers are, they can simply place an order across a variety of channels, customers can purchase products through in-store, or POS, or even through your websites.
In a few clicks, when the order is received, the system updates inventory levels in real-time across all sales channels.
The system also provides you an accurate measure of your inventory to avoid overselling, overstocking, and inaccurate forecasting, in addition to the ability to search for items using its SKU, and know which SKUs are the best sell through each channel.
4- Handle Reverse Logistics(Returns)
If the returns process was easy, the vast majority of your customers will return to shop again.
An efficient OMS leads your return processes, and handles all returning cases to provide that fuss-free returns experience for everyone.
Benefits of an Order Management System
What is the benefits that OMS solution can provide for your business, let us see the top important benefits of an OMS:
Using an OMS system will simplify the supply chain operations and automate the entire order fulfillment process including placing orders, updating inventory levels, payment details, shipping, as well as managing returns.
This will reduce human error from manual process, which can cause inventory issues and ruin customer experiences creating logistical nightmares from the number of returns you’ll need to process.
The right OMS will free your time up allowing you to focus on growing your business and boost customer satisfaction.
Accurate Reporting, Real-Time Information
Using an efficient OMS will provide you with real-time data display regarding inventory, orders, customers, and more.
Thanks to up-to-date information, you can track customer behavior and product performance to identify trends and address quickly any issues that may arise and impact customer service.
This way you will jump over your competitors, and make smarter analytics and decisions that boost your business.
Accurate reports also give you insights about managing your inventory to avoid overselling, or under-ordering, or going overboard with stock replenishing. Thus, you will have a more efficient and highly optimized order management process.
Improve Customer Experience
With OMS software, no longer your sales reps have to make phone calls to office staff when on a sales call.
Instead, your team can focus on providing high quality of service to your customers as the software offers them instant access to all important customer account information.
Indeed, your customers want to track their order and know what is happening with it in real time. OMS software creates a sense of ownership for customers since they can place their own orders, make changes to the order, check on the status of their orders and delivery information as well as payments, look up inventory, and be informed about the status of their account without the need to call customer service or a sales rep every time. Thus, this allows customers to self-service their order and give them control over their own accounts.
As a result, customer experience will be more reliable with long-term revenue that businesses will boost due to consistently satisfying customers.
If you have a lack of insight into your inventory levels, then it will probably result in two big problems: Over-stocking, and Over-selling.
An Order management system gives you a better visibility into sales that help to optimize inventory levels and forecast how much stock warehouses will need.
Accurate inventory management allows your business to ensure customer satisfaction and increase cash flow.
As the speed of shipping a product from warehouse to the customer is critical for organizations, they use OMS to simplify the picking and packing process.
An OMS identifies the closest fulfillment center to the customer, and sends order information to the determined center in order to pick, pack, and ship the product as soon as possible.
Reduce Human Error
As a business owner, time is an important factor for your success, it is literally money. Using OMS software saves you time and money since it reduces your accounting costs, as well as, it reduces the time associated with manual entry where data entry takes time, and that also means less potential for errors in the order management process.
In addition, an OMS reduces the need for management controls to revise manual data entry.
Order management system gives you a centralized information of your orders, inventory, and accounting with a quick overview of all you need to boost your sales and make your customers satisfied.
Choosing the Right OMS
Choosing the right OMS for your business isn’t a decision to take lightly. Businesses are unique, every business has its own needs.
The right order management system should make your business easy, cut costs, save time, and make your customers’ engagement better.
Whether you have a large or small business, there is some considerations to take when choosing an OMS:
A good order management system is integrates with inventory management and accounting tools and other services like 3PL providers.
Integration’s reliability is an important thing, whether it’s direct or indirect integration.
Reporting & Analytics
Reporting capabilities is another thing to consider when choosing an order management system, make sure the OMS can provide you the following:
– Accurate reports that give you insights into customer behavior and product performance to help you make better decisions.
– Visibility on inventory levels to Over-stocking, and Over-selling issues.
– Simplified order fulfillment tracking and sales tracking operations.
– A real-time overview on your profitability.
– A data-driven demand forecasting.
And other important factors that depend on your business’s needs.
Make sure the OMS has no negative implications on customer experience.
If you expect your order volume will double or triple in the coming five years, then choose an order management that can handle these changes to your operation.
Scalability is a key consideration when choosing an OMS for brands that have lofty plans to to grow and develop in the future.
You need to choose an OMS that provides you 24/7 available support in order to gain ongoing consulting to help improve business’s workflows.
Features every OMS software must have
A good order management system must have the following basic features:
– Easy to handle
– Real-time inventory
– Multichannel order management
– Fulfillment optimization
– Order tracking
– Customer database
– Warehouse management
– Third-party logistics (3PL) services
Order management system for eCommerce and small businesses
Nowadays, In an era where eCommerce brands think for faster, more personalized, and more modern order fulfillment.
An order management system has come to be the future way in the ecommerce world. It is because businesses are unable to grow without an order management system in place.
An order management system is designed to provide faster delivery with two-day shipping fulfillment, fewer mistakes where human errors are the source of time-and-money waster, more scalability where it can be able to grow alongside your company, and with multi-channel opportunities making brands to be everywhere.
OMS solutions provide one-of-a-kind customer satisfaction by its great features among which are centralization inventory levels, order tracking across channels, efficient order fulfillment, shipping processes, and more.
New G Solution and Ecommerce Order Management
New G Solution is multi-channel selling software to streamline and automate order fulfillment and inventory management.
New G solution is convenient for all kinds of business even if you are a wholesaler, a retailer, or a distributor, as well as eCommerce and international business with effective features include:
- Central quantity synchronization control with your eCommerce sales channels like: Market Places, B2B, and B2C platforms
- shipping management
- Warehouse Management
- Invoices and bills Control
- Reporting and analytics
- 3PLs and Financial integration
- Returns and refunds
What are you waiting for? boost your sales, grow your business with us, take your free trial now.