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How to ensure your order management system is ready for Christmas

(Source: Bigstock.)

The Christmas season can be chaotic. Shops are busier, online sales increase and staff are stretched. On top of the usual stress, this year poses additional challenges for Australian retailers. The capping of incoming flights has put significant pressure on shipping and container costs are escalating up to four times their usual rates. Australia Post has been overwhelmed with orders, with many staff having to isolate due to Covid-19, creating delays all over the country. 

To prepare for the challenges ahead, it’s time for businesses to make sure they’re as prepared as they can be. With consumers looking to shop early, it’s time to re-evaluate the priorities and logic that you may not have touched for months or even years. If your Order Management System (OMS) is flexible, you can and probably should make short-term changes to account for your biggest season. 

Here are a few tweaks that could help you sell and deliver more efficiently and profitably this season.

1. Ramp up your availability

Nothing else your OMS can do matters if you lose a sale, or overpromise and have to cancel, due to inaccurate information about availability. It’s particularly challenging when items on store shelves are also offered for sale online – and the stakes are even higher during the Christmas shopping season. Think about the following:

  • Generous buffers are crucial for items with unreliable supply chains and helps account for items going astray across a busy store. However, if a store has to go dark, set buffers to zero, and keep the product moving.
  • Some sellers switch to fulfilling line items as soon as inventory is available even if other items in the same item are backordered. It shows the customer you’re doing your best while reducing the amount of stock that needs to be held as pending in your already busy distribution centre or store.
  • Consider decreasing fraud tolerance for specific items or categories that you expect to sell out. Why take a chance when you can get your product into the hands of trustworthy (and higher long-term-value) buyers?

2. Rethink your sourcing

Often it’s labour and capacity that become limiting factors during the Christmas sales period rather than an item being in short supply. Therefore, it could pay off to tweak sourcing rules. 

  • Prioritise distribution centres over stores. Preserve the brand experience by keeping hot items on store shelves and employees available to help shoppers. When January comes around go back to preferring the oldest inventory or optimising for shipping time and expense.
  • Free up distribution centre capacity by routing orders to third party logistics or drop-ship vendors. Guide your OMS to prefer the stores better equipped to efficiently process the order. If you lack time or data for precise categorisation, choose a proxy such as store footprint size.

3. Secure your shipping

  • Increase your default processing time. It’s better to underpromise and underdeliver than to disappoint. Giving yourself an extra day or two of padding can reduce the disappointment (and customer complaints) caused by any shipping delays or delivery mistakes.
  • Prioritise short-SLA orders. A customer who pays extra for expedited shipping expects priority all the way through, not just once the package is consigned to the carrier. Pick and pack these orders first, and if the distribution centre is at risk of missing a deadline, fail over to a nearby store if possible.
  • In normal times, it’s smart to delay order orchestration to allow a customer to cancel an order before fulfillment begins. Over the Christmas period, there’s not a moment to spare. Shorten this buffer so you can begin processing within a few minutes.

4. Organise your stores

One unavailable item can ruin the entire pick-up or same-day delivery experience. Some small adjustments for the Christmas period could make all the difference, and keep customers coming back well into next year.

  • Shift pick-pack and pick-ups to off hours. This will reduce demands on staff’s time, and allow them to focus on in-store shoppers during peak hours. It can also speed up pick-ups, and reduce car park congestion.
  • Set and adjust limits for click-and-collect orders. To avoid long delays and last-minute cancelations, set upper limits for how many orders each store can fulfill. Empower store managers to increase or decrease these limits based on daily capacity.
  • To reduce the chances of an in-store shopper buying what you’ve already sold for delivery or pick-up, consider running a ‘lowest-stock’ pick procedure before your standard methods. 

Taking the time to adjust your system can feel like a chore, but if you implement some or all of these changes you’ll be surprised how much of a difference it can make. With everything else that is going on this year, it really is worth taking this time to give yourself all the advantages you can. Make sure your OMS system is working for you.

About the author: Jamie Cairns is SVP channel & alliances at Fluent Commerce.