order management system

If you hadn’t noticed already, customer expectations are constantly growing, and when it comes to experiencing a brand, they have really high expectations.

Today, consumers want to purchase exactly what they want, whenever they want, and how they want. In simple words, your customers just need their stuff and they don’t care where you have them.

But, when they experience an issue with your brand, say related to delivery or an error in payment, chances are high that they wouldn’t want to shop from you again in the future.

This is where order management and an order management system (OMS) come into play.

What is an Order Management System?

An order management system, or OMS, is a platform or tool that helps you keep track of your orders, inventory, sales, as well as fulfillment, by doing which it creates a positive customer experience.

how does an order management system work

The whole process of order management starts right from when a customer places an order on your website, through to making sure that the order has been fulfilled, and also deals with any returns and after-sales requirements.

Some of the most common functions of an OMS are:

Stores the shipping information of customers.

Tracks inventory, along with various other aspects, including location, and constantly updates the same when purchases are made.

Tracks orders using various fulfillment processes.

Manages returns and refunds.

Generates and prints shipping labels, packing tags, and the like.

In addition, an order management system typically automates any process that is otherwise carried out manually.

Why Do You Need an OMS?

Your Current System is Dated

Starting with the most obvious reason, you will need an order management system if your current system is dated and unable to meet customer expectations.

As a business, it is crucial that you provide a consistent customer experience across all channels, including customer service, marketplaces, social channels, and more, and with old technology, you wouldn’t be able to do the same, especially with omnichannel orders.

Whether you use a POS system, and ERP system, or anything else for that matter, chances are it will struggle to keep up with multichannel orders, which makes an OMS the best viable solution available to you.

Increase in Sales and Revenue

Since an order management system performs the job of gathering information across different channels, it gives your sales executives the ability to offer your customers exactly what they are looking for, regardless of the product’s location.

order management system benefits
OMS benefits

This approach is widely referred to as the endless aisle, which is known to increase sales and thereby your revenue as well.

Since this gives customers the ability to choose how to get the product (having it shipped to their home address, shipped to a store, or held for pickup) it also improves customer experience and customer satisfaction.

Should You Use an Order Management System?

The answer to this question would be a “yes”, if:

Your business operates in numerous locations.
Your business deals with high volumes of shipments on a regular basis.
Your fulfillment process is complicated at present.
You sell across different channels.

Let’s just say that if you are selling your products via a single channel, say a single website, an OMS is not something that will be helpful to you.

On the other hand, as mentioned, if you sell across numerous channels, or for any of the reasons given above, your business will highly benefit from an order management system.

How to Choose an OMS?

Before you shortlist a few OMS vendors to consider, here are a few steps you should take:

Discuss with your team about the various order management features and integrations you will need and make a list of the same.

Rank the same in order of importance, just so you are able to differentiate the essentials from the rest.

Write down all the vital data, which should be inclusive of your budget, order volume, channels you are selling on, total number of SKUs, etc.

You can then start researching the many OMS vendors offering their services, shortlist a few, and start analyzing the shortlisted ones.

Once these steps are done, you should come up with the top two or three vendors you know will be able to meet your OMS requirements, and choose one from the list.

When it comes to analyzing the OMS vendors, some of the factors you should look for are:

Value for money. This goes without saying, and one fact you should remember is that the most expensive OMS tool on the market may not always be the ideal solution for your business needs.

What you need is an offering that will be sustainable for you in the long run.

Ease of use. Of course, one of the main reasons for you to use such software is to make your job easier.

Right from the setup process to the platform’s user-friendliness, everything about it should be easy for you to use.

Scalability. As a business, you are going to take up and manage more orders with time, which means that the OMS solution you choose should be able to scale with you.

It should be flexible enough to seamlessly make the required transition, without giving you any form of headache.