Two-Day Shipping or One-Day Order Processing: What Wins? - ecommerce order fulfillment | 3PL Warehouse
What is Distributed Order Management (DOM) and Why Do You Need It?
What is distributed order management (DOM) software? It's a solution to solve shipping problems by ensuring orders are fulfilled from the best location.
The days when a retailer could focus on their brick-and-mortar store are long gone. Even for businesses that sell primarily online, customers can come in through multiple channels. Yet, each of those customers expects to have the same easy, frictionless experience.
In today's changing world, you can't expect customers to come to you. Instead, you have to ensure that they have the chance to buy your goods at the most convenient location for them.
As things become even more complicated (not to mention customer-centric), retailers start to face real challenges. In fact Amazon has raised expectations with customers now expecting package tracking for every order. And not only that, but they want to know exactly when their product will arrive; five to ten business days no longer cuts it with many customers. They want fast delivery in 1-2 days...but they don't want to pay for it.
Meeting these standards with traditional order management can be challenging. These older, legacy systems don't have enough flexibility or visibility, and often disregard where inventory is located (obviously, the fastest way to ship product is to send it from the closest warehouse, but that is hard if your system doesn't know which the closest warehouse is).
The best solution is Distributed Order Management (DOM).
What is Distributed Order Management?
Distributed order management (DOM) software is designed to solve the shipping problem by ensuring that orders are fulfilled from the best location. This means that if a customer in New Jersey orders a product, it won't be shipped from California when it's in a warehouse in New Jersey. The system also takes into account priority (how fast the customer wants the item) and capacity (how many items the warehouse can ship). Yes, this does mean that if someone orders items with standard shipping, the rules may relegate it to a more distant warehouse.
The software, of course, contains all the features of legacy order processing systems, such as automated transactions, informing warehouse workers what to pick, etc. But it even goes beyond that. In fact, the more sales channels you have, and the wider a geographic area you ship across, the more important it is to switch to Distributed Order Management.
How is Distributed Order Management Better Than Traditional Order Management?
DOM systems provide a number of benefits, some of which may be more relevant to you than others. Some benefits include:
1. Improved Scalability
You can switch to a DOM early and keep adding features as your company grows. Distributed order management applications are cloud-based, so any updates made are instantly available. You can log in to the system from anywhere, including store managers using their phones.
2. Improved Data
DOM stores all of your order and fulfillment data in one place, making it much easier to evaluate and analyze the data. This can help you track marketing efforts, predict potential inventory shortages, and more.
3. More Accurate Inventory
Because DOM treats your entire system in a unified and integrated way, you don't need to juggle multiple systems to keep track of inventory. You know exactly what you have and where it is.
4. Easier Splitting of Shipments
Splitting shipments is easier, for example, if something is on backorder or if things are located in multiple warehouses.
5. Real-Time Order Processing and Shipping/Tracking Data
Tracking data can easily and automatically be provided to customers, giving them the ordering and shipping experience they expect.
6. Setting Rules
The ability to set rules for where something should be shipped from, such as prioritizing high-velocity warehouses over stores, limiting the capacity of popular locations, designating locations based on item type, etc. You can also turn fulfillment nodes on and off so that if a location is shut down or otherwise unavailable, it is taken out of the system. You can set the system to prioritize some fulfillment nodes at different times of year to help mitigate weather conditions.
7. Better Ordering Experience and Improved Flexibility
Better ordering experience for customers and improved flexibility. DOM better allows for in-store and curbside pickup, for returning items bought online to a store, etc. It also lets you promise a delivery date before the customer even orders.
8. Reduced Amount of Work
Reduced work for warehouse employees, who no longer have to double-check that the order complies with your rules.
How to Leverage Distributed Order Management Software For Your Business
DOM software is a cloud-based solution that will help your business gain all of the benefits above and then some. You should consider DOM software if:
- You have multiple fulfillment locations in varied geographic areas. DOM makes sure that the right fulfillment center is used.
- You commonly have to split shipments, such as if one item is on backorder. DOM also lets you split a shipment to ship items from different locations if needed, in order to get the product to the customer as quickly as possible.
- One of your fulfillment locations keeps getting prioritized and overwhelmed.
- You provide gift wrapping or a similar service, but not in every location.
- You provide store and/or curbside pickup.
- You have a large number of product suppliers. DOM lets you manage those relationships and track when to order better.
- You have hundreds and thousands of SKUs to worry about.
- You have multiple order processing systems, for example, a different system for orders placed online and ones placed with a store manager. This can result in a very different experience for different customers.
- You use multiple shipping providers depending on distance, speed, etc.
- You are selling to, or have warehouses in, multiple countries.
How ChannelApe Can Help
ChannelApe offers a distributed order management system aimed at brands with large numbers of SKUs. Our solution will make sure that your orders are always shipped from the right warehouse, on time. Every time. We provide the real-time inventory visibility and last-mile supply chain data you need for better customer service and you can even customize shipping rules to work for you (including pre-built templates to get you started).
Gain real-time inventory visibility, reliable pre-sell options, and the ability to avoid unplanned overselling –enabling you to provide better customer service, gain better business insights, and cut expenses.
Distributed order management is the future of omnichannel retail, and if things keep going this way, all retail will be omnichannel. Consider whether it is time for your business to switch to DOM and if the answer is yes, contact ChannelApe to get a free demo and find out what we can do for you.