How To Get Sales Order Processing Right
In this guest post, Tony Kyberd, COO of Tyme partner Volo Commerce, outlines some of the finer points in the order management area of a company’s ecommerce operations.
In any ecommerce business there are perhaps 4 main operational areas. First, how you source and manage your stock. Second, how you list, market and promote your products. Third, how you deal with your customers. Fourth, how you deal with your orders.
The first two things happen before the customer buys your product. The second two happen post-order, when the emphasis is on the best buyer experience in the most operationally efficient way.
Sales order processing has a direct impact on the success of an ecommerce business. Marketplaces impose a relentless focus on the buyer experience so that they’ll return and buy some more, so buyers now have very high expectation levels when it comes to delivery. Shipping criteria have a very strong bearing on the buying decision. According to ShipStation research, 96% of buyers factor delivery into their purchase decision. Added to that, 71% of purchases on eBay were shipped free in in 2019.
For sellers, two key aspects govern sales order processing. Firstly, having a flexible range of attractive shipping options in the first place to seal the deal. Secondly, being able to follow through and deliver – literally – on those options.
As we’ve said, marketplaces are reliant on repeat buyers, so they place a high value on a great buying experience, elevating the good sellers and relegating the poor sellers. To meet or exceed marketplace expectations, you need a warehouse, team and system that deliver on the SLAs you’re setting with your customer and the marketplaces. They can be either under your direct control or contracted out to a trusted partner.
Either way, you should look at what shipping options your buyer has selected and prioritise your order processing accordingly. For example, don’t do the 2-day pick, pack and dispatch orders before the next day orders. Furthermore, look at your order curve through the day, and map your resources accordingly. If you see a lot of orders on web stores and marketplaces coming in the evening, as has been the case before the coronavirus pandemic, then you or your partner might need to tweak your shift allocation. You might also need to do this after studying your order curve through the week.
It makes sense to optimise your pick process. Put your fast-moving products near the pick pack area. If you analyse your best sellers and your stock velocity, you’ll know your fastest moving items. An alternative approach is to keep an amount of every product line close by or in the warehouse, and keep the reserve further away or in another warehouse. If you map your pick pathways around the warehouse for the optimal pick run, then your pickers can use the pick list for their walk order.
Some ecommerce systems will allow you to assign a location or walk order, which means you can print out a pick-list that mirrors the walk order sequence. Depending on how your warehouse is organised, you can either get the furthest away items first and work inwards, or vice versa. This is generally a much more efficient way than simply printing the latest order and picking it.
If you have shippers scheduled to collect at certain times, synchronise your pick runs accordingly. For example, the first pick run is to process last night’s orders and today’s orders can come later. If someone orders delivery within 24 hours, you need it to be out of the warehouse within a few hours. Orders with a longer delivery window can come later.
Assuming the orders have been picked correctly, it’s useful to scan the items at the packing stage – ideally accompanied by an on-screen image coming up for confirmation – as a final check before your close the package. The more your buyers receive first time exactly what they ordered, the more you reduce returns and bad feedback and the more you protect your margins.
One last thought for those companies that take a ‘just in time’ approach process for their products, especially if they do back orders: there’s no point putting items away from the goods in area, only to retrieve them again for fulfilling the order. A lean put away process allows your items to remain in your ‘goods in’ area until after your last pick run of the day.
In summary, there are many ways to streamline and automate and your sales order processing operations to improve both your effectiveness and your efficiency.
Your goal is buyers opening their orders when or before they were expecting them and leaving a 5-star review, at the lowest cost.