The power of managing orders quickly is all you need to thrive in a time when everything is fast-paced and always on. Customers today demand a fast and crisp process, and nowhere is this more crucial than in shopping. Who doesn’t love a single click on a saved Pinterest pin that takes you directly to an e-commerce website, where with just one more click, you can purchase the exact same piece of clothing? But to make that happen, you need an Online Order Management System like no other.
By centralizing and automating the entire process—from inventory tracking to order fulfillment—an OMS lets you manage everything in one place, simplifying operations, improving accuracy, and helping your business grow. In the article below, we’ll understand what an OMS does, how it does it, and how to choose an OMS for your specific business.
What is an Online Order Management System?
Let’s address the elephant in the room first, shall we?
So, an Online Order Management System is a kind of digital platform that streamlines and automates an order from its origin to delivery. Basically, everything from inventory updates, payment confirmations, shipping, and delivery tracking—all of that is put under one roof, so you, as a business, don’t have to switch between tools or do any manual entry. An OMS is able to bring together all these moving parts, making sure orders are accurately processed and ensuring customers are kept in the loop.
Why an OMS is Essential for Business Growth
If your business is thriving and expanding, you’ll likely need a way to manage the increasing volume of orders across various sales channels. Sound familiar?
An Order Management System (OMS) can simplify this process by handling complex order logistics, reducing the risk of bottlenecks. It streamlines operations, speeds up order processing, minimizes errors, and provides real-time updates, all of which enhance customer satisfaction.
Whether you're in e-commerce or retail, an OMS is an essential online solution that helps businesses of all sizes meet the diverse challenges of order management, ensuring growth and efficiency as you scale.
How Does an Online Order Management System Work?
Picture it like this — an OMS is like an automated conveyor belt for your orders. It continuously runs from the moment a customer orders until delivery with automated inter-work steps to minimize delays or errors.
Steps in the Online Order Management Process
Here’s a general flow of how an order management system on the web processes orders:
- Order Placement: The customer places an order on a sales channel such as a website or app.
- Inventory Check: The system checks the inventory automatically in real-time.
- Payment Gateway Processing: It connects to payment gateways to safely complete the transaction.
- Order Fulfillment: The order is transported to the nearest warehouse or fulfillment center and is packed and shipped.
- Shipping & Delivery: The OMS creates tracking information and updates the customer.
Integration with Inventory, Shipping, and Payment Gateways
A powerful OMS can connect with each and every part of your business — it will link inventory systems, payment providers, and even shipping carriers to create a smooth and tension-free order management process for you. Another thing that this kind of integration does is eliminate the need to update stock or shipment details manually — every single thing gets automated. Now, isn’t that flawless?
Benefits of Using an Online Order Management System
Having an OMS is undoubtedly highly beneficial – for one, it is able to improve efficiency and reduce errors, and on top of that, it can also offer better transparency to both your team and customers. A closer look at the benefits:
Automating Order Processing for Increased Efficiency
Automation in OMS would allow you to automate repetitive tasks, such as order entry, status updates, and stock management. The benefit to your business is that it will accelerate, eliminate any form of manual mistakes that are easily detectable, and it will free up your team’s time for more strategic tasks.
Centralized Multi-Channel Order Management
When you have an OMS, you can manage orders from multiple sales channels—whether from your own website, from some physical store, or any other social media website—all of this in one system. A centralization like this reduces the likelihood of errors that can come from switching between platforms and ensures consistent service no matter where the order originates. A win-win for everyone!
Real-Time Inventory Tracking and Order Updates
Everyone knows that keeping up with inventory can be pretty challenging, and this is especially so when orders come from different websites/platforms. Again, we look to OMS for help; the OMS will be able to provide real-time tracking for both inventory and orders — as a result, customers will be able to receive accurate stock availability information and businesses will be able to avoid problems like overselling or stockouts.
Features of a Good Online Order Management System
It’s time we find the right OMS for you. Here is a look at its key features and the two different types to get you started:
Key Features to Look for in an OMS
- Order Tracking: Provides visibility into the entire order lifecycle, from placement to delivery.
- Inventory Management: Monitors stock levels in real-time, so you know exactly what’s available and what needs restocking.
- Multi-Channel Integration: Allows you to manage orders from all sales channels in one place.
- Automated Customer Notifications: Keeps customers informed with real-time updates on order status and delivery.
- Data Analytics: Provides insights on sales trends, stock movement, and customer behavior to inform better business decisions.
Cloud-Based vs. On-Premise Order Management Systems
Would you rather have a cloud order management solution or an on-premise one? What it boils down to is your business’s demand.
Typically cloud-based systems are easily accessible, flexible, and affordable so that you can get it in your hands if you have a company that values mobility and the ease of maintenance — go get a cloud OMS solution!
Conversely, on-premise solutions are often more customizable but still cost more upfront and may need maintenance.
Security Features in an Online Order Management System
When you’re selecting an online solution and order management platform, look into its security. Look for an OMS that provides encryption, payment processing security, and GDPR compliance for the security of customer data. Payment security not only protects data, it also helps increase customer confidence, particularly during digital payments.
Choosing the Right Online Order Management System for Your Business
Finding the right OMS can transform your business operations, but it’s important to consider your specific needs and budget before selecting one.
Factors to Consider When Selecting an OMS
- Cost: Make sure you look at the upfront cost and any ongoing expenses for the OMS. If you are a small business, a free online order management system might be a good starting point for you. Once you grow as a business and feel that more requirements are needed, you can always search for a better one.
- Scalability: Choose an OMS that can adapt as your business grows, allowing you to seamlessly add more channels or handle higher-order volumes.
- Integration Capabilities: Ensure the OMS integrates with your existing tools, like inventory software, payment gateways, and e-commerce platforms.
- User-Friendliness: A simple, intuitive interface can save training time and help employees work more efficiently.
Comparing Popular Online Order Management Systems
Companies must consider their needs when selecting an online order management system (OMS). Bigger stores with high volume and multi-location inventory may need more advanced functionality like automated inventory monitoring and multi-channel integration. On the other hand, smaller businesses might look for a more budget-friendly or free online order management system to get started.
Popular platforms, such as Shopify, offer an integrated inventory, order processing, and sales funnel solution that’s perfect for growing e-commerce stores. Meanwhile, tools such as TradeGecko (QuickBooks Commerce) that provide advanced inventory management and easy integration with Amazon and Shopify are ideal for scalable businesses.
Challenges in Implementing an Online Order Management System
Adopting a new OMS isn’t always easy, but understanding potential obstacles can make the process smoother.
Common Obstacles and How to Overcome Them
- Integration Challenges: Integrating an OMS with existing systems can be a little tricky, especially if you’re using multiple platforms. Ensure that you choose an OMS with solid support and compatibility to minimize these hurdles.
- Employee Training: A new system often requires employee training; getting a user-friendly OMS and setting aside time for training can make everyone comfortable with the new setup.
- Data Migration: Migrating data into an OMS can be a tad bit challenging. Careful planning and testing are essential to ensure data accuracy and a smooth transition.
Maintaining Consistent Customer Experience Across Channels
When it comes to businesses moving into new sales channels, there’s one thing we’re sure about — continuity. An OMS is a centralized service that guarantees the same high level of service to every order regardless of where it is ordered. This ensures your brand consistency and maintains the trust of the customer.
Future Trends in Online Order Management
Order management is changing fast, and new technologies are constantly expanding the capabilities of an OMS; here are a few trends in the future:
AI and Machine Learning in Order Management
Machine learning and AI are the two ways to expand OMS and provide data-driven knowledge of inventory, customer behavior, and demand planning. Such systems can enable businesses to make informed decisions, tailor the buying experience, and even cut fulfillment costs by forecasting high demand times.
The Role of Automation and Robotics in the Future of Order Fulfillment
Automation and robotics are playing a growing role in fulfillment centers, speeding up tasks like order picking, packing, and shipping. Do we realize what this means? This means that in the future, we could see fully automated order management systems online that can manage everything from start to finish with minimal to no human intervention.
Conclusion
An online order management system can very well revolutionize the way you operate your business. With its deletion of the ‘to err is human’ factor and the ability to achieve high levels of customer satisfaction — it is truly one of a kind.
From automating order processing to centralizing multi-channel management, an OMS offers the tools to keep up with customer expectations and industry demands. Whether you’re starting with a free online order management system or a comprehensive paid platform, investing in an OMS is a strategic move that allows you to grow with confidence, improve efficiency, and focus on delivering the best possible customer experience.
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FAQs
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What is an online order management system, and what does it do?
An online order management system is a digital infrastructure — it is software that automates and consolidates the order fulfillment from beginning to end (listing, tracking, delivery). It also enables companies to improve efficiency by automating multiple stages of the order flow. -
How can an online order management system improve customer satisfaction?
An OMS with automation and real-time updates can reduce the time of order fulfillment and deliver precision — the customer will be pleased and better informed. -
What are the key features of a good online order management system?
Some of the key features are inventory, order, multichannel, customer alerts, and data analytics for better business and customer experiences.
