Omnichannel order management system: What it is and its benefits

If your business deals with orders from multiple sources, you’re likely familiar with the challenges of coordinating fulfillment across different platforms.

This is where the Omnichannel Order Management System (OMS) comes into play.

It can help your business streamline operations, boost customer satisfaction, and stay competitive.

An omnichannel OMS integrates various sales channels—whether that’s in-store, mobile, online, or other platforms—into a single cohesive solution.

It helps businesses deliver a seamless customer experience, from order placement to fulfillment.

But how does it work, and why should your business consider implementing one?

This article dives into omnichannel order management, how it differs from the multi-channel approach, and its key features and benefits.

Here’s what we’ll cover:

What is omnichannel order management?

To understand omnichannel order management, we first need to define what “omnichannel” means.

The term refers to an integrated approach where all customer touchpoints work together to create a seamless experience.

This means your customers can browse, order, and receive products across any channel in a smooth and unified way.

In the context of order management, this approach is critical to meeting customer expectations and running a smooth operation.

An omnichannel OMS connects all your business sales channels and back-end systems to create a single, unified order- management process.

This system ensures that inventory, order data, and customer interactions are synchronized in real-time, no matter where or how the order is placed.

Whether your customer buys online and picks up in-store, orders from a mobile app, or purchases in-person, the omnichannel OMS is designed to make sure the right product is available and delivered quickly.

All while keeping your records and systems accurate and up-to-date.

Omnichannel versus multichannel order management

Omnichannel and multichannel order management systems are often confused.

It’s understandable, as both manage orders from various sales channels, but the key difference lies in how these channels are integrated.

Multichannel order management system

A multichannel order management system tends to product-focused.

It allows you to manage orders for products from various different sales channels, but each channel operates independently.

For example, an order placed online may be treated differently from an in-store purchase, meaning inventory and related data isn’t always shared across both channels.

This can lead to issues like stockouts or order fulfillment confusion when customers switch between channels.

Omnichannel order management

Omnichannel order management, on the other hand, is more customer-focused.

It integrates all channels into a unified system, allowing for real-time inventory visibility, seamless order routing, and a more consistent experience for customers.

An omnichannel approach means you can offer customers flexibility—like allowing them to order online and pick up in-store—while keeping your order and inventory information aligned.

In short, while a multichannel approach works in silos, omnichannel unifies them into a smooth, cohesive process.

This means that an omnichannel OMS is often a more efficient and customer-friendly option for modern businesses juggling many different sales channels.

Key features of an omnichannel order management system

An omnichannel OMS doesn’t just manage orders; it provides a full-featured platform designed to support the complexities of a multi-touchpoint world.

Here are some of the key features that make omnichannel order management solutions so effective:

Centralized inventory management across all channels

An omnichannel OMS allows you to centralize your inventory data so you can see in real-time what stock is available across all channels.

This eliminates the need to track inventory separately for online and in-store operations, which can often lead to stock discrepancies and missed sales opportunities.

With centralized inventory, you can avoid stockouts, make better restocking decisions, and ensure that customers can order from any channel without issue.

Real-time order tracking and fulfillment

Real-time order tracking is one of the standout features of an omnichannel OMS.

It allows you to monitor the status of every order—whether it’s in the process of being fulfilled, on its way to the customer, or ready for in-store pickup.

This transparency enables better communication with your customers.

It provides them with timely updates and helps minimize the number of customer service inquiries you receive related to order status.

Customer data integration for personalized experiences

With an omnichannel OMS, your customer data from various touchpoints is integrated into a single system.

This means you can deliver personalized experiences across all channels, boosting customer satisfaction and building loyalty.

For example, if a customer has previously bought a product using your website, your system can use that information to suggest similar products when they shop via a mobile app.

Seamless order routing between channels

One of the most powerful features of omnichannel order management solutions is their ability to route orders seamlessly between channels.

Say an online order needs to be fulfilled from a physical store, or a customer places an in-store order but wants it shipped.

No problem.

Your omnichannel OMS can intelligently route the order to the right location for fulfillment.

You’re meeting your customer’s needs while optimizing fulfillment efficiency by tapping into available inventory across all locations.

Flexibility in managing returns and exchanges across channels

Managing returns and exchanges can be a logistical challenge for businesses operating across multiple sales channels.

An omnichannel OMS simplifies this by allowing returns from any channel to be processed through any other channel.

For example, your customers can return an online purchase in-store or vice versa.

This streamlines the return process and improves customer satisfaction, as they have more options for returning or exchanging products.

Benefits of omnichannel order management

Adopting an omnichannel order management system can brings several key benefits to your business.

Below are some of the most significant advantages:

Improved customer experience

With an omnichannel OMS, your business can offer a more consistent, personalized, and convenient shopping experience.

Whether your customers shop online, in-store, or through a mobile app, they can expect seamless service across all touchpoints.

This consistency fosters brand loyalty, as your customers appreciate not having to jump through hoops to complete their purchase or return a product.

Increased operational efficiency

Another primary benefit of an omnichannel OMS is improved operational efficiency.

By centralizing inventory, streamlining order fulfillment, and automating many processes, your business can reduce the risk of human error and make better use of resources.

This means fewer stockouts, faster order processing, and a smoother experience for your customers as well as your staff.

With an omnichannel system in place, you can optimize your fulfillment operations, cut down on waste, and improve resource allocation.

Higher sales and customer retention

Offering customers flexible options for order fulfillment, such as buying online and pick up in-store, makes the shopping process more convenient and can help drive higher sales.

Customers are more likely to return to your business if you offer a fast, reliable service across multiple channels.

An omnichannel OMS can help you achieve this.

If implemented and managed well, it will empower your business to meet customer expectations about delivery times, real-time stock availability, and the flexibility to shop in whatever way suits them best.

Real-time insights and better decision-making

An omnichannel order management solution integrates with other business systems and collects data from across all sales channels.

It gives you real-time insights into your customers’ preferences, order trends, and inventory performance.

With access to this information, you can make better decisions in relation to stock levels, marketing strategies, and sales forecasting.

This data-driven approach will also help your business stay agile and responsive to changes in customer behavior or market conditions.

How an omnichannel OMS improves operational efficiency

The efficiencies gained from implementing an omnichannel OMS go beyond just customer experience—there are significant operational benefits that can help improve your business’ overall bottom line.

Reduces manual workload

Updating inventory, processing orders, and checking stock levels manually can be very time-consuming and lead to human error.

With omnichannel order management, many of these tasks are automated.

For instance, when an online order is placed, the system will automatically update inventory levels immediately, preventing overselling.

Similarly, order routing can be automated, directing orders to the most optimal fulfillment location, whether it’s a warehouse or a retail store.

Streamlines inventory management

An omnichannel OMS makes managing inventory across multiple channels easier.

The system provides a centralized view of your inventory, minimizing the risk of stockouts and making sure inventory levels are reflected accurately across all channels.

It also makes it easier to track stock movement.

This, in turn, will help you elevate your restocking strategies and make sure that high-demand products are always available.

Integrates seamlessly with other systems

Effective omnichannel order management solutions integrate seamlessly with other enterprise software, such as Enterprise Resource Planning (ERP) and Customer Relationship Management (CRM) systems.

This integration allows for better coordination between sales, inventory, and customer data, leading to more efficient and accurate operations.

It makes sure that information flows smoothly across your various departments, eliminating silos and paving the way for a more cohesive business operation.

How to choose the right omnichannel OMS for your business

Selecting the right omnichannel OMS will help your business handle its order management needs more effectively.

Important factors to consider

Business size

Larger businesses with more complex needs will want to consider an advanced solution with robust customization options.

Smaller businesses, on the other hand, might benefit from a simpler system.

Sales channels

Consider the channels you currently use (e.g., online, in-store, mobile) and make sure the omnichannel order management solutions you’re looking at support integration across all of them.

Ease of integration

You’ll want a system that integrates well with other software solutions, like your ERP or CRM.

The OMS you choose should offer strong integration capabilities or work well with APIs that can link your existing systems.

Key features to prioritize

Scalability

The OMS you choose should be able to scale with your business as it grows and adapt as your operations expand or shift priorities.

Real-time inventory management

Accurate, up-to-date inventory data is crucial to keeping your stock levels healthy and empowering you to deliver fast order fulfillment.

Reporting capabilities

Look for a system with strong reporting tools that offer easily digestible, actionable insights into sales trends, inventory performance, and customer behavior.

Common challenges and how to overcome them

As you’ve seen, there are many benefits to investing in an efficient omnichannel OMS, but there are also challenges to consider when implementing it:

Overcoming initial setup complexities

Implementing an omnichannel OMS can be complicated, especially for businesses with complex order management needs and existing software.

Proper planning and a phased implementation approach should ease the transition.

You can also help make the setup as smooth as possible by working with an experienced OMS vendor and appointing a dedicated project team.

Overcoming resistance to change

Some of your employees may resist new technology and change, especially if they are accustomed to manual processes.

As part of your implementation strategy, make sure you give your team the training they need on the new system.

You can also encourage adoption and boost staff morale by opting for a user-friendly system and clearly showcasing its benefits.

If you can demonstrate that the new software is going to make your team members’ lives easier in the long run, they’re more likely to get on board.

Final thoughts

As businesses strive to meet the evolving demands of today’s connected customers, an omnichannel order management system can prove an essential tool for success.

If your business deals with multiple sales channels and you want to stay competitive in an increasingly customer-centric market, investing in powerful order management software is a smart move.

It will elevate your operational efficiency and give you the tools you need to offer your customers the seamless, personalized experiences they expect.

With the right omnichannel order management system, you can deliver a better, more flexible customer experience while boosting your bottom line.

Learn more with Sage.