Articles When to Tap Your 3PL’s Order Management System
In today’s omnichannel retail environment, shoppers want a consistent experience regardless of channel, product availability and order tracking information, fast and/or free shipping, and more. Providing the shopping experience they’re looking for requires a robust order management system (OMS). However, just 3 percent of retailers currently have systems that fully support efforts to improve the customer experience, according to a new whitepaper from eyefortransport.
To address this technology deficit, many retailers are turning to third-party providers. How do you decide if outsourcing an OMS is a viable option? Steve Congro, Saddle Creek’s director of omnichannel fulfillment technology, recently shared helpful tips to guide the decision process with MultiChannel Merchant.
The following is an excerpt from his blog post. . .
Outsourcing and OMS: When Does It Make Sense?
An OMS will soon become a prerequisite for the optimal omnichannel customer experience; however implementing such a sophisticated system requires internal expertise, financial investment, ability to scale, etc. Many retailers find that outsourcing to a 3PL allows them to realize the benefits of an OMS more efficiently, seamlessly and cost-effectively.
Here are a few questions to when deciding if outsourcing makes sense for your business.
Is logistics/supply chain a core competency for your organization?
A skilled 3PL with an integrated OMS will remove the burden on operations time and overhead and allow you to focus on what you do best. Outsourcing supply chain operations allows you to put fulfillment in the hands of experienced partners that specialize in just that – supply chain operations. This gives you the unique advantage to provide your customer with an experience that is handled by experts from inception to product delivery.
Do you have the internal expertise to manage the system?
Many companies have an experienced IS department, but have they worked with an OMS before? Do they have current, comprehensive knowledge of the WMS? Are they able to integrate the two? Can they troubleshoot when problems arise? Is their ability to navigate the system sufficient to keep customers’ orders flowing and maintain customer satisfaction?
All of these are important questions when considering investing in an OMS or outsourcing to someone with experience running an OMS. The time and cost associated with training current employees on the system should be a factor as well.
Are you ready to make the requisite financial investment?
An OMS can be a costly venture. Most systems require a major capital outlay up front, followed by associated monthly fees as well as customer support fees that accrue as you learn the system and require assistance. In addition to the expense associated with the OMS software purchase, other business costs also must be taken into account. Employees will need to be trained on how to utilize the software. Downtime will escalate during the integration phase, and initial utilization of new technology can also cause order errors – resulting in unsatisfied customers and increased returns.
Is your competition already using an OMS?
With widespread adoption of OMS technology expected in the near future, chances are, your competitors are considering or have already begun using an OMS. Are you anxious to join your competition in the omnichannel market but unsure how to navigate the inner workings of your inventory management? Do you know that more software is needed but don’t know exactly what you’re looking for? Is your current system incapable of fulfilling from multiple sources to accommodate growing order volume? Outsourcing your OMS to a 3PL may enable you to compete in the omnichannel market.
To learn more about outsourcing an OMS, read the full MultiChannel Merchant article or download our new whitepaper “OMS: Key to the Optimal Omnichannel Customer Experience.”