Blog Posts What is an OMS and Why Do I Need One?

What is an OMS

Omnichannel and unified commerce are fast becoming the new norm in retail. Customers expect a consistent and seamless experience. Before placing an online order, they want to know if an item is in stock online or available for pickup at a nearby store. And they’ve come to expect fast and free shipping as well as multiple options for delivery.

To meet these high expectations, many companies are adopting an OMS. Steve Congro, Saddle Creek’s director of omnichannel fulfillment technology, offers a crash course in this must-have technology.

Q: What the heck is an OMS?

A: An Order Management System, or OMS for short, is a system that is capable of managing all aspects of an order’s lifecycle. For example, how do you see and manage orders that come in from multiple places like a commerce platform, mobile app, store point of sale or online marketplace? How about if you have merchandise in a warehouse, store and/or with drop-ship vendors? What system will your contact center use? How will you manage backorders? What system will process customer payment? An OMS can help with all of these issues.

Q: Do I need to be doing all of those things to use an OMS?

A: Definitely not! A strong OMS is modular, allowing for people with varying business complexities to take advantage of its power. Let’s say you have a single sales channel, a single fulfillment location, but want to utilize a backorder process in order to capture sales at peak demand. An OMS is a great tool to manage these orders and their associated inventory.

Q: Is a DOM (Distributed Order Management) the same as an OMS?

A: The DOM is a component of a larger enterprise OMS. Generally speaking, the DOM is the intelligence engine that powers the order routing to warehouses, choosing the best warehouse to fulfill your order. The DOM is very important, but it’s only a part of order management. What system is your contact center going to use? How are payments going to be processed? Where are all of the integrations going to be housed? This is where the power of a first-class OMS comes into play.

Q: Can an OMS scale with my growing business?

A: Absolutely! Being a modular system, a powerful OMS is designed to grow as your business grows. Obviously, throughput is important, but what about evolving business needs? Let’s say you want to spread your inventory to a second warehouse in order to be closer to your national consumer base. Adding a second fulfillment site to your OMS should be a simple task. Then, the system can route orders to the two warehouses based on rules such as ”ship complete,” “closest to the customer,” and inventory positions – among other things.

Q: Can an OMS really integrate with all of the different things you’ve mentioned?

A: Yes! When an OMS is built on top of an integration framework, it enables the system to receive orders from anywhere, send requests for fulfillment to anywhere and provide a unified view of your orders and inventory. It’s pretty powerful.

Q: Does an OMS help with my omnichannel or unified commerce initiatives?

A: At Saddle Creek, we believe OMS is the key to unified commerce. While the warehouse management system (WMS) is a critical tool in fulfillment, it is designed to be a “four-walls” system, meaning a system operating inside the four walls of the warehouse. Tasks like communicating with a commerce platform, contact center activities, payment processing and backorder management, to name a few, aren’t warehouse activities. This is where an OMS is best suited.

Q: Will I have to manage multiple integrations? I don’t have a huge IT team (or one at all).

A: This is where the power of outsourcing your OMS needs to a partner like Saddle Creek can be very valuable. The integration between our OMS and our network of warehouses has been tested over time, specifically designed with both stability and client needs in mind. In many cases, we work with clients on a single integration pipeline – from their commerce platform or ERP system to our OMS.

Q: Tell me more about Saddle Creek’s OMS.

A: Our OMS is cloud based so it can be accessed from anywhere and operates on a single platform for seamless systems integration. It automatically routes orders so that they are filled by the most effective fulfillment source to optimize inventory management, shorten delivery times and control costs. This robust technology provides real-time, enterprise-wide visibility, putting valuable inventory and order-tracking information at your fingertips (and your customers’). Our system is also scalable to accommodate fluctuations in sales volume and grow with your business.

To learn more about the value of order management systems, what to look for and when to outsource, read our whitepaper.