What is Order Management Software (OMS)

Edgars Kebbe

Updated August 14, 2022

An OMS is order management software that automates tracking sales numbers, order processing, inventory management, delivery, and fulfillment processes. These solutions can also help brands monitor people, processes, and partnerships. Controlling all functions related to multi-channel order management solution allows your team and your customers to track the process and analyze its end-to-end efficiency. 

Incorporating order management software into your company is so essential that it will allow you to be prepared when sales increase as your business intelligence expands. In addition, your team can save time and money while efficiently allocating resources by automating the tedious manual steps throughout the order management features. 

No matter how big your business intelligence is, it would help to incorporate order management software to meet customer expectations, as they will order products through different multichannel sales strategies. In addition, they will want the option of home delivery or in-store pickup and the ability to return or exchange the product at a designated location.

What Order Management Systems do?

An order management software (OMS) centralizes a company’s order processing in a single tool, synchronizes its stock in real-time, and offers the customer a smooth and agile shopping experience.

Likewise, order management software makes a business run more efficiently and reduces the number of errors in order fulfillment and payment processing. This way, inventory can be managed across different sales channels, and checking inventory availability in real-time allows for easy stock balancing, sales forecasting, and order taking.

Moreover, order management software helps ensure more accurate inventory management by automatically entering new inventory into the system, tracking sales across different sales platforms, and alerting when the stock of a particular item is low enough for reordering.

Similarly, the order-to-cash process can also be automated with order management software, starting with the customer order processing through payment processing, fulfillment, and shipping. 

Order management software can also be shared, from the customer service team to the accounting team, warehouse personnel, and the business owner. Effective order management solution improves business workflow and increases the likelihood of repeat sales orders from customers, creating purchase loyalty.

Automate the order fulfillment process

An order management system is based on automation, from the storefront to the delivery of the product. It allows you to reduce manual work and, therefore, labor costs. 

While reducing process times, the order management software chooses the warehouse or delivery process location, determines the order of the process steps, and sends a request to the warehouse so that personnel can prepare for the order. 

Because an order management system can shorten the time of the delivery process, you can reallocate the resources used and focus on more complex parts of your business that contribute to growth and customer satisfaction. Also, order management software will increase data security, an essential component in today’s increasingly digitized world.

Accept orders and payments online

Sales order management software is often integrated with billing software and occasionally has a functional overlap with the system. Depending on the product or service being sold and the number of customers the consumer wants to keep records, sales order management products can also be combined with CRM software and a subscription management system.

E-commerce is one of the leading consumer channels, so it is essential to offer an efficient and quality online ordering service, which would be unfeasible without the automation of order management software processes.

Today’s market is faster and more competitive; therefore, you must have order management software with features inventory management modules to succeed in your business.

With flexible features, you can sell your products through multiple channels, whether you want them online, retail or wholesale. Manage everything accurately and procure efficiently through purchasing, contract manufacturing, or simple manufacturing.

Manage customer information

Order management software (OMS) handles all contact information and customer activity that helps service representatives recognize their most profitable users. 

In this way, multiple channels can meet customer needs to deliver a seamless e-commerce experience, eliminating the time your team spends on the order fulfillment process and training colleagues. 

In addition, order management software provides order overviews, reduces human error, and centralizes all necessary data in one location in real-time.

Provide timely invoicing and payment processing

An order management system offers a unified inventory management software to monitor the inventory control and algorithms that route sales orders to the correct warehouse and choose the best shipping options. These algorithms will be used at all stages of the inventory management process: picking, packing, shipping and tracking.

The order management software (OMS) will receive and unify order information coming in from all points of sale, including online orders, in-store purchases, and customer service orders. It could also include support orders from various world regions with different currencies.

Similarly, order management software allows product information to be updated in real-time, which helps manage customer returns and exchanges across all sales channels.

Give buyers a way to track their orders from purchase to delivery

The order management system can also notify the customer that the product has been shipped and estimated arrival times. You and the customer can track the product through the entire sales channel, i.e., from its initial shipment from the warehouse to its destination.

Once the product has left the warehouse and at the indicated time after the shipment arrives, the order management system should automatically send an email to the customer asking them to evaluate the product and ensure that they have received everything in the order. This follow-up should also include detailed instructions on how to contact customer service.

When you have an order management system, if a customer is dissatisfied, it should be easy to find the return and refund policy and follow the instructions. Order management systems can quickly process a refund request and communicate with the accounting team to process it. You can also contact the returns provider to ensure that all data is accurate and updated.

Forecast stock levels to prevent out-of-stock issues

If your company does not have access to forecasting software and inventory management software, you will not be able to know when to stock the warehouse. 

It will result in either overstocking or understocking, which means you will either have large amounts of unsold inventory in the warehouse or not enough stock to meet demand. Incorporating an order management system solves both problems.

You can better forecast peak selling seasons, popular products, and buying trends with order management software. You’ll also accurately determine the amount of warehouse space you’ll need for your products, so you’ll always have a good inventory management solution.

Route purchase orders to the closest order fulfillment center or warehouse

Once the order arrives at the warehouse, most order management software will choose the closest or most accessible order fulfillment center in proximity to the order destination. It will then calculate shipping costs and decide which carriers are the fastest. Also, an order management software supports print shipping labels, packing slips, and receipts.

At this step, for order management software to work, it will be critical to have a SKU and barcode for each item. If a product has both, the accuracy of the delivery process will be higher and it will be easier for the warehouse to scan the product and add it to the order.

In this way, with an order management software and its process automation, we manage to reduce order preparation times and possible errors due to stock breakage or confusion between items. This makes it possible to manage a large volume of orders effortlessly.

Benefits of an Order Management System

Due to omnichannel commerce operation and the rise of eCommerce, companies have to be able to handle a large volume of orders coming from various sales channels. Order management software supports wholesalers, online retailers, online stores, and the retail sector to optimize and streamline their order receiving, picking, and shipping processes.

Companies must manage an ever-increasing volume of orders, not only from their network of retail outlets, but also from online stores, and control multiple processes associated with them, such as product availability, centralized inventory management solution, offering customers shipping options, or communication with warehouses and carriers for order preparation.

In this way, order management software responds to a digitized consumer, who demands last-mile delivery service with ever-shortening lead times, and who demands multiple shipping systems as quickly as possible.

Types of Order Management Systems

Manual order management solution

You’ll be able to track all information and fulfillment processes, including order intake, inventory management modules, order fulfillment, and after-sales service. All order management software provides visibility for both the business and the buyer. Organizations can have real-time insights into inventory management solution, and customers can check when an order will arrive.

In addition, order management software provides staff dealing with customers with a view of the customer, resources, and backup inventory control to execute transactions more efficiently.

Using an e-commerce platform

Order management software specializing in e-commerce platforms and drop shipping helps merchants worldwide ship, track, and return their orders. A full retail tech ecosystem can provide features that include mass shipment tracking, shipping label creation, returns processing, and delivery at checkout.

In addition, sellers can synchronize with multiple marketplaces and courier management systems to automatically import orders for shipping. Order management software allows users to print bulk shipping labels, track deliveries, upload return policies, and create a customized return module across all stores and websites.

Standalone order management software

All order management software automates the entry, processing, and catalog management of sales orders across multiple channels, such as telephone, mail order processing, retail, or internet shopping. They also offer specific feature packages for specific retail sectors, such as mobile, wireless, electronics, furniture, appliance, gift, pharmacy, or music stores. 

Order entry applications also offer real-time integration with inventory management, order management processes, payment processing, marketing, and customer relationship management, helping to optimize costs and increase efficiency. Likewise, order management software interfaces with e-commerce platforms and the order management system.

Enterprise retail platform (ERP) software

In the retail industry, it is essential to anticipate consumer needs. Therefore, an Enterprise retail platform (ERP) software for retail is handy to supply chain operations: from department stores to franchises; from the head office and warehouses to the points of sale.

An Enterprise retail platform (ERP) retail software also enables retail companies to work much more efficiently. You get a dedicated program that controls stock, optimizes the warehouse, and allows you to automate routine processes across multiple sales channels.

A digital operations platform for retail

To compete and thrive, retailers must deliver seamless shopping experiences that exceed customer expectations. Today, retail software for multi-channel order management processes, personalized shopping carts, e-commerce platforms, and more are available for retailers, manufacturers, and consumer goods companies. 

Omnichannel retailing eliminates the lines between channels, from in-store digital displays to online marketplaces and pop-up stores. 

Choosing the right order management software

First of all, you must be clear about what you want to achieve, i.e., why you have decided to invest in management software, and know the available budget. 

Then, depending on your current situation and what you want to achieve in the future, you can opt for several types of order management software according to your budget and the features offered by the software.

Assess your current business needs and define business requirements

There are more important criteria that you should also take into account when selecting the best order management software

It would be best if you always considered the different characteristics of your business project and, on that basis, choose the order management software that will best suit those characteristics. For example, consider the size of your business, whether you have employees, whether your business is physical or online, etc. 

Consider necessary functionality to fulfill business requirements

It is essential to lay the groundwork before purchasing and implementing an order management system

Having this program guarantees better organization and good service since the actual stock is always available and can be shown to the buyer. Some variables to consider are the following:

  1. Price – functions you get about the investment and any scaled price by order processing volume or users.
  2. Shipment – route order processing based on warehouse or customer location. 
  3. Inventory management – maintain inventory levels across all systems and sales channels. 
  4. Customers – track customer orders and update accounts 
  5. Financial – help with returns and refunds 
  6. Integrations – the ability to synchronize data with your other platforms, such as sales channels, order fulfillment partners, financial systems, and POS.
  7. Offline Capabilities – help with Online Purchase, In-Store Pickup, and Endless Aisle processes. 
  8. Reporting – visibility into your process to track performance or alert you to any issues.
  9. On-premise or in the cloud – the company has quick and easy access to the program’s functionalities, which securely stores data on external servers managed by the ERP system provider.


The order management processes are critical that all companies wishing to improve their competitiveness in the market must be optimized. Thus the relevance of order management tools to enhance the customer experience arises as it ensures the effective coordination of each order processing. However, there are essential stages, such as the last mile, in which an error could ruin the work done throughout the entire supply chain.

If you want to avoid mishaps, it is advisable to use specialized software, such as plan routes, track deliveries, and notify the company and the customer of the status of their shipment in the last mile. Thus, it will be possible to make more successful sales to the end customer and the company.

What are you waiting for to use order management software in your company?

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