A business without an efficient order management system is likely to struggle. Whether you’re handling retail sales or financial transactions, an Order Management System (OMS) is essential to ensure smooth operations. We will now talk about what OMS is, its key features, and the significant benefits it brings to a business entity.

Table of Contents

1. Definition of An Order Management System
2. Key Features of an Order Management System
3. Why Do Businesses Need an Order Management System (OMS)?
4. Types of Order Management Systems
5. How Does an OMS Work?
6. Benefits of an Order Management System
7. Choosing the Right OMS for Your Business
8. Challenges of Implementing an Order Management System
9. Future Trends in Order Management Systems
10. Summary

Definition of An Order Management System

An Order Management System (OMS) is software that manages every aspect of an order. An OMS simplifies and automates tasks like order placement, processing, fulfillment, and returns. In simple terms, it ensures that an order placed by a customer is handled with precision from start to finish. One may feel that an OMS is an unnecessary tool for a business. That may be true for small businesses, but imagine if the orders start to pile up day after day. For businesses that continue to scale up, OMS is a game-changer.

Key Features of an Order Management System

1) Order Processing

An OMS automates processes like order capture, verification, and fulfillment, reducing manual errors and significantly speeding up processes. Basically, when you standardize and automate workflows, your business can handle higher volumes of orders without the cost of additional resources.

2) Inventory Management

Real-time inventory updates that prevent overselling and ensure stock availability across sales channels. With such a system in place, you can gain a unified view of inventory levels across however many warehouses, stores, and online platforms. This amazing insight will allow you to avoid stockouts or overstocking, which can impact profitability.

3) Omnichannel Integration

Integration with multiple channels, including online stores, physical outlets, and marketplaces, to centralize operations. If you operate your store through different channels, you definitely would want customers to have a consistent shopping experience regardless of the platform they use. With OMS platforms, you can ensure such an experience for your consumers since one centralized system handles these processes across all channels.

4) Reporting and Analytics

Deep insight of specific business metrics, such as order trends, bottlenecks, and performance, enabling businesses to take informed actions to optimize processes and drive improvements. Let’s be honest, it can be quite a nuisance to generate essential reports for the maintenance and growth of your business. Utilizing OMS, you can forecast demand, track order fulfillment efficiency and highlight any other areas of improvement as well.

5) Customer Communication

Automated notifications that keeps customers informed about order status, delivery timelines, and returns, reducing the need for manual follow-ups. Have you ever experienced the “Where is my order” question by a customer? Imagine having that question asked over and over again every single day. OMS systems can personalize these updates, enhancing the overall customer experience and engagement.

Why Do Businesses Need an Order Management System (OMS)?

1) Efficiency and Accuracy

The advantage of an OMS is that it is excellent in automating repetitive tasks, minimizing errors, and ensuring faster order processing. When you eliminate manual workflows, you get to allocate resources to more strategic activities. For example, if you run a small bakery, instead of focusing on each order, inventory levels and deliveries, you can dedicate more time to creating new recipes or marketing your bakery to grow your business. OMS handles the mundane work, allowing you to concentrate on what matters most.

2) Scalability

OMS platforms support businesses of any size or scale. They are designed to handle increasing order volumes as businesses grow. Whether a small business is expanding its operations or an enterprise is managing complex global supply chains, an OMS adapts to changing demands. You can continue to grow and grow and grow without fear of exceeding your business’s operational capacity.

3) Improved Customer Experience

When you have faster deliveries, real-time updates, and efficient returns processes, you gain happier customers. When customers receive real-time updates, it builds trust in the business due to the transparency shown. Let’s face it, at the end of the day, customers are what makes the business a success. Happy customers equals successful business.

26% found it difficult to coordinate separate facilities/departments relevant to successful order fulfillment. -OrderTron

Types of Order Management Systems

1) Standalone OMS

Standalone systems only focus on order management specifically and are ideal for small businesses. Such systems are cost-effective and straightforward since they are easy to implement and does not require a lot of training. They would be perfect for small businesses in their early stages.

2) Integrated OMS

Integrated systems are a part of something much bigger. They are integrated into larger softwares like ERP(Enterprise Resource Planning) or CRM(Customer Relationship Management). Such a system would be a perfect fit for businesses requiring multiple functionalities, such as inventory control, accounting, and customer data management, all centralized in a single platform.

3) Cloud-Based OMS vs. On-Premises OMS

• Cloud-Based OMS: Accessible remotely from anywhere, suitable for globally distributed teams. This is a great solution since it eliminates the need for expensive hardware or infrastructure and is updated automatically.

• On-Premises OMS: Managed within a company’s own infrastructure, providing control over data and security. These systems are more suited for industries with strict regulatory requirements.

Onecart offers a cloud-based OMS platform, combining flexibility with powerful features for businesses of all sizes.

A cloud-based order management system (OMS) is a powerful and intuitive tool for tracking orders, sales, and inventory as well as streamlining the processes involved in order fulfillment. -XABIS Inc

How Does an OMS Work?

The basics of an OMS process flow is as follows:

1. Order Capture: Gather orders from various channels.

2. Order Processing: Verifies details, checks inventory, and processes payments.

3. Fulfillment: Coordinates picking, packing, and shipping with logistics partners.

4. Returns Management: Simplifies the return and refund process for customers.

Benefits of an Order Management System

For Retail Businesses

• Faster order processing.

• Reduced errors in inventory and fulfillment.

• Enhanced customer satisfaction.

For Global Supply Chains

• Centralized operations for multi-warehouse coordination.

• Improved collaboration between suppliers and logistics providers.

Choosing the Right OMS for Your Business

Key Considerations

1. Business Needs: Choose a system that fits into your current business operations

2. Integration: Ensure the OMS integrates with any of your existing tools in your business (Example: CRMs, ERPs etc)

3. Scalability: Choose an OMS that can grow with your business

Challenges of Implementing an Order Management System

1) Initial Costs

Some OMS solutions require significant investment upfront, which can be a barrier for small or medium-sized businesses. However, many providers, like OneCart, offer scalable pricing plans that reduce upfront expenses and make such a system very much accessible.

2) Integration Complexities

Ensuring a harmonious communication between systems can be challenging, especially for beginners. If a business uses existing tools like ERP, CRM, and warehouse management systems, it is important to ensure that the chosen OMS can integrate smoothly with other mentioned systems.

3) Learning Curve

Employees may need extensive training to use the OMS effectively. While this may not be a huge obstacle, it could result in a temporary slowdown of operations during the transition period.

Onecart addresses these challenges with affordable pricing, easy integration, and a user-friendly interface that requires minimal training.

Future Trends in Order Management Systems

1) AI and Machine Learning

Let’s face it, every latest trend these days involves AI. OMS platforms will soon leverage AI to improve forecasting and automate the decision-making process. For example, AI can analyze historical data to predict demand surges, helping businesses to optimize inventory levels ahead of time.

2) IoT and Smart Warehousing

IoT(Internet of Things)-enabled devices will further improve fulfillment operations. This is already an ongoing implementation as warehouses have adopted the use of robots to speed up order processing efforts.

Summary

An Order Management System (OMS) is an unavoidable tool that a business needs to embrace in order to improve efficiency, scalability, and customer satisfaction. From automating repetitive tasks to providing real-time visibility into orders and inventory, an OMS system excels at improving processes and reducing errors. Choosing the right OMS is essential to unlock the benefits attached to such a system. A flexible, cloud-based solution like Onecart offers powerful features that are perfect for businesses of all sizes.

Ready to take your order management to the next level? Start your free trial with Onecart today and discover the transformative benefits it can bring to your business.