order management
01 Jul

Order Management Best Practices: A Comprehensive Guide

In today’s competitive landscape, efficient order management is no longer a luxury – it’s a necessity.  For supply chain professionals, ensuring smooth order fulfillment from click to delivery is crucial for customer satisfaction, business growth, and profitability.


This comprehensive guide deepens into order management best practices, equipping you with the knowledge and strategies to optimize your operations.


Order Management Key Steps for Manufacturing


Order management is a critical process in manufacturing, encompassing the entire journey from order placement to fulfillment and post-delivery support. Efficient order management ensures customer satisfaction, optimizes resources, and drives profitability. Here are the key steps and best practices to follow:


Order Placement and Capture:


Multiple Channels: Allow customers to place orders through various channels (website, phone, email, EDI) for convenience.

Accurate Data Entry: Ensure accurate capture of customer information, product details, and delivery requirements.

Order Confirmation: Provide prompt order confirmation to customers, including estimated delivery dates.


Order Processing:


Inventory Check: Verify product availability and reserve inventory against the order.

Credit Check: Conduct credit checks for new or high-value customers.

Order Prioritization: Prioritize urgent orders or those with special requirements.

Documentation: Generate necessary documents like sales orders, pick lists, and packing slips.


order management


Order Fulfillment:


Picking and Packing: Efficiently pick and pack items according to the order details.

Shipping and Delivery: Choose the most cost-effective and reliable shipping method.

Tracking and Communication: Provide order tracking information and keep customers updated on delivery status.


Post-Delivery Support:


Invoice and Payment Processing: Generate and send invoices promptly, and track payment status.

Returns and Exchanges: Handle returns and exchanges efficiently and professionally.

Customer Feedback: Collect customer feedback to identify areas for improvement.

order management


Order Management Best Practices for Manufacturing


  • Automation: Automate repetitive tasks like order entry, inventory updates, and shipping label generation to reduce errors and improve efficiency.
  • Centralized System: Use a centralized order management system (OMS) to manage orders from multiple channels and integrate with other systems like ERP and CRM.
  • Real-time Visibility: Provide real-time visibility into order status and inventory levels for both customers and internal stakeholders.
  • Clear Communication: Maintain clear and timely communication with customers throughout the order lifecycle.
  • Performance Measurement: Track key performance indicators (KPIs) like order accuracy, on-time delivery, and customer satisfaction to identify areas for improvement.
  • Scalability: Ensure your order management process is scalable to handle increasing order volumes as your business grows.
  • Continuous Improvement: Regularly review and optimize your order management process to improve efficiency, reduce costs, and enhance customer experience.


By following these best practices and steps, manufacturers can establish a robust order management process that ensures customer satisfaction, optimizes resource utilization, and drives business growth.


order management


Order Management Workflow


The order management workflow ensures every order is fulfilled smoothly. It coordinates various steps and systems to get products from your store to your customer. Here’s a simplified breakdown:


  • Stages: Receive, Process, Pick & Pack, Ship & Track, Post Delivery
  • Start: Customer places an order (mobile, tablet, desktop)
  • End: Order is delivered


Stages of the Order Management Workflow


  • Receiving: BigCommerce consolidates orders from various channels. Payment is captured automatically or manually. Inventory is adjusted in real time if tracking is enabled.
  • Processing: Orders are moved through fulfillment stages. This can be done manually in-house or automatically through a 3PL service.
  • Pick & Pack: Orders are picked from inventory and packaged for shipment. Picking methods (Single, Batch, Zone, Wave) and packing materials depending on your business needs.
  • Ship & Track: The order is shipped with your chosen carrier after packing. Your team ensures the correct shipping label is applied, the order is marked as “Shipped,” and tracking info is sent to the customer.
  • Post Delivery: Focus on creating a positive experience beyond delivery. This could involve custom packaging, easy returns/refunds, or prompt follow-up on feedback.


order management


What is an Order Management System?


An order management system (OMS) is a software tool used in businesses to manage the entire order lifecycle, from when a customer places an order to when it’s delivered. It essentially acts as a central hub that keeps track of everything related to an order.


Here are some key functions of an OMS:


Order processing: Receiving and processing orders from various sales channels (websites, stores, etc.).

Inventory management: Tracking stock levels across warehouses and preventing overselling.

Fulfillment: Picking, packing, and shipping orders efficiently.

Order tracking: Providing customers with real-time information about their order status.

Returns and exchanges: Managing the process of returns and exchanges for customers.


Features of Order Management System


Here are some of the key features of an Order Management System (OMS):


Core Features:


  • Multi-channel Integration: Connects seamlessly with various sales channels like online stores, marketplaces, and physical stores. This provides a unified view of all orders across different platforms.
  • Inventory Management: Tracks inventory levels in real-time across warehouses and fulfillment centers. This helps prevent overselling and ensures accurate order fulfillment.
  • Order Processing Automation: Automates tasks like order validation, tax calculation, and generating shipping labels. This reduces errors and speeds up order processing.
  • Fulfillment Management: Provides features for picking, packing, and shipping orders efficiently. This can include functionalities for warehouse management and routing orders to the optimal fulfillment location.
  • Order Tracking: Enables customers to track their orders in real-time, providing estimated delivery dates and shipment status updates.
  • Returns Management: Streamlines the process of managing returns and exchanges. This allows for faster processing and improved customer satisfaction.


Additional Features:


  • Customer Relationship Management (CRM) Integration: Integrates with CRM systems to provide a holistic view of customer data and interactions.
  • Real-time Analytics and Reporting: Generates reports on order fulfillment metrics, inventory levels, and customer trends. This data can be used to identify areas for improvement and optimize operations.
  • Workflow Automation: Enables automation of various workflows within the order fulfillment process, such as sending notifications or triggering specific actions based on order status.
  • Omnichannel Support: Facilitates a seamless customer experience across all channels, whether customers order online, in-store, or through a mobile app.
  • Scalability: The system can scale to accommodate business growth and increase order volume.


Choosing an OMS depends on the specific needs of your business. The features you prioritize will depend on factors like the size and complexity of your operation, the number of sales channels you use, and the types of products you sell.


order management


Streamlining the Order Process:


Identify bottlenecks: Analyze your current order flow and pinpoint areas that slow down processing. Are there manual steps that can be automated?

Embrace automation: Leverage technology to automate repetitive tasks like order entry, data validation, and invoice generation.

Implement quality control measures: Establish clear procedures for order verification and error correction to minimize fulfillment mistakes.


Enhancing Fulfillment:


Clearly defined picking and packing processes: Establish standardized procedures for order picking and packing to ensure accuracy and efficiency.

Leverage technology: Utilize warehouse management systems (WMS) to optimize picking routes, automate packing processes, and track order fulfillment progress.

Multi-channel fulfillment: Implement systems that seamlessly handle orders from various sales channels (website, marketplaces, etc.).


Prioritizing Customer Experience:


Offer order tracking: Provide customers with real-time order status updates and estimated delivery timelines.

Simplify returns: Make the returns process hassle-free with clear return policies, pre-printed return labels, and self-service return portals.

Proactive communication: Keep customers informed throughout the fulfillment process, especially in case of delays or stockouts.


Technology is Your Ally:


Invest in an Order Management System (OMS): An OMS centralizes order processing, inventory management, and fulfillment activities, providing a holistic view of your order life cycle.

Integrations are Key: Ensure your OMS integrates seamlessly with existing systems like WMS, CRM, and accounting software for efficient data flow and reduced manual work.


Continuous Improvement:


Track and measure performance: Monitor key metrics like order processing time, fulfillment accuracy, and on-time delivery rates.

Data-driven decision-making: Utilize performance data to identify areas for improvement and implement new strategies to optimize your order management.

Embrace a culture of feedback: Encourage customer feedback and use it to refine your order fulfillment processes.


By implementing these best practices and leveraging technology, supply chain professionals can transform their order management processes, leading to increased efficiency, improved customer satisfaction, and a significant competitive advantage.