To stand out as a B2B business, you must offer your customers an exceptional shopping experience besides offering high-quality products and competitive pricing. Without an efficient order management system (OMS), you may struggle to meet customer expectations and risk falling behind competitors who leverage technology for efficient operations.
By 2025, 80% of B2B sales interactions between suppliers and buyers to occur in digital channels.
If you are scaling rapidly or managing complex B2B orders, an OMS can streamline your operations, improve customer satisfaction, and help you keep up with demand.
But what about an ERP (Enterprise Resource Planning) system? Do you need that too? In this blog, we’ll explore why an OMS is a critical B2B eCommerce platform feature, and when you might consider adding ERP into the mix.
An Order Management System (OMS) is software that facilitates the management of customer orders from entry through fulfillment, ensuring that all aspects of the order lifecycle are efficiently handled.
In simpler terms, it ensures that all orders placed, are accounted for, smoothly processed, and delivered on time. It includes capturing customer data, processing orders, managing inventory, and tracking shipments until delivery.
Most of these, and sometimes, all of these processes are automated.
B2B eCommerce businesses handling over 1,000 orders a day see 35% fewer fulfillment errors with an automated Order Management System.
An OMS connects your sales channels, warehouse, and logistics providers in one centralized platform, automating manual tasks that can bog down your operations.
Let’s face it – managing B2B orders is far more complex than a B2C business. And, B2B eCommerce companies often face unique challenges, such as high order volumes, bulk purchasing, complex pricing models, and multiple fulfillment locations.
Ineffective order management can severely impact B2B businesses in various ways, leading to
An OMS isn’t just a tool for tracking orders. It addresses critical B2B challenges head-on by offering real-time visibility, automation, and synchronization across your order management process.
A B2B OMS is no longer a nice-to-have, but a ‘must-have’ B2B eCommerce platform feature to future-proof a B2B business.
35% of respondents now rank B2B ecommerce as their most effective sales channel, surpassing in-person interactions, which are favored by only 26%. - McKinsey
A B2B OMS eliminates the bottlenecks and errors caused by manual order processing. It ensures that orders move from purchase to delivery seamlessly, without delays or mix-ups.
Use a robust Order Management System to:
Reduce manual errors: Automation minimizes manual data entry, significantly reducing the risk of errors in order processing.
Improve workflow efficiency: By streamlining workflows, an OMS helps businesses process orders faster, which is crucial for scaling operations.
Boost customer experience: With accurate order tracking and timely updates, you can improve customer service and loyalty.
A B2B order management system is a comprehensive solution that ensures every aspect of the order lifecycle is optimized and streamlined.
Here’s a breakdown of how an OMS works:
Orders are received through multiple channels, including eCommerce websites, mobile apps, marketplaces, EDI systems, phone calls, or in-person sales
The OMS checks inventory levels, verifies pricing, confirms customer details, and ensures that the order meets specific business rules before proceeding
OMS generates order documents, assigns tracking numbers, and updates the order status in the system
Orders are sent to the appropriate warehouse for picking, packing, and shipping
Once shipped, tracking information is provided, and the OMS updates the order status in real-time
The order is delivered to the customer. Successful fulfillment relies on efficient processes and logistics coordination to ensure timely delivery
In the event of a return, the OMS automates the process, updating inventory and managing refunds or exchanges
Customers are engaged for feedback and returns/exchanges are managed
When choosing a B2B Order Management System (OMS), it's essential to identify key features that will enhance your order processing capabilities and overall business efficiency.
Here’s a list of critical features to look for in a B2B OMS:
An OMS streamlines complex B2B orders and processes, ensuring accuracy, efficiency, and customer satisfaction.
Bulk orders: Handle large, complex orders with multiple items and variations efficiently
Customizations: Manage customer-specific pricing, quotes, discounts, and product configurations effortlessly
Kitting: Automate the assembly of product kits based on customer requirement
Automated order routing: Automatically assign orders to the appropriate warehouse or supplier based on pre-set criteria like product availability or delivery location
Automated Returns: Simplify returns with return labels, RMA automation, and restocking
Order workflow automation: Automated workflows for order approval, fulfillment, and shipping
Real-time inventory management: Real-time updates across multiple warehouses to prevent stockouts and overstocking
Here’s an example of how a comprehensive OMS dashboard should look like.
An OMS fosters collaboration and efficiency within your supply chain, ensuring timely deliveries and reducing costs.
It helps optimize the following:
Vendor portal: Provide suppliers with a centralized platform to manage orders, inventory, and communication
Dropshipping: Streamline dropshipping operations with automated order routing and tracking
Consignment inventory: Manage inventory held by suppliers and track stock levels accurately
B2B transactions have unique requirements that go beyond standard eCommerce functionality. An OMS addresses these needs by improving efficiency across:
Credit checks: Integrate with credit checking services to assess customer creditworthiness before processing orders
Contract management: Manage contracts, pricing agreements, and service level agreements (SLAs) within the OMS
Purchase order management: Process and track purchase orders from suppliers efficiently
This is critical for B2B businesses that handle complex logistics, large order volumes, and diverse shipping needs.
Carrier integration: Integration with major shipping carriers (e.g., FedEx, UPS, DHL) for real-time rate comparison, label generation, and shipment tracking
Split shipments: For partial or split shipments, especially for large orders that need to be fulfilled from multiple locations or different warehouses
Dropshipping support: OMS should support dropshipping capabilities to streamline fulfillment directly from suppliers
Data-driven decision-making is crucial for B2B businesses. An OMS transforms raw data into actionable insights, enabling you to optimize:
Real-time insights : Advanced OMS platforms provide real-time insights into order status, inventory levels, and fulfillment processes
Performance tracking : OMS dashboards can track key performance indicators (KPIs) such as order fill time, return rates, and shipping costs
Profitability analysis : Track product profitability and identify areas for improvement. You can also identify areas for cost reduction and optimization
Profitability analysis : Track product profitability and identify areas for improvement. You can also identify areas for cost reduction and optimization
Order forecasting and demand planning : Get insights into historical sales data, market trends, and customer behavior
In a B2B environment, efficient data flow and integration with other systems are essential for streamlined operations and improved customer experiences. An OMS acts as a central hub.
ERP integration: Integrate with your ERP systems for streamlined data flow and improved efficiency
CRM integration: Synchronize customer data between your OMS and CRM system for better customer relationship management
Third-Party Logistics (3PL) Providers: Outsources logistics and fulfillment processes
Shipping carrier integration: Automate shipping label generation, multi-carrier support, bulk label printing, and documentation
Payment integration: Flexible payment options, including credit terms, purchase orders, and invoicing
B2B self-service system integration: B2B portals for customers to view orders, place new orders, and track shipments
eCommerce Platform integration: Facilitates all eCommerce sales and operations through a single platform (e.g., Shopify, Adobe, ewiz commerce, Woo Commerce)
Implementing an OMS is just the first step. To truly optimize your order management process, consider these additional best practices:
Automating tasks like order validation, fulfillment, and shipping can significantly reduce manual work and errors. Less manual intervention leads to faster and more accurate order processing.
Integrate your OMS with your Warehouse Management System (WMS) to streamline picking, packing, and shipping. Automation here will reduce bottlenecks and improve fulfillment times.
Implement self-service features that allow customers to track orders, manage returns, and access account information independently. This reduces the workload on customer service teams and improves customer satisfaction.
Use DOM capabilities to optimize order routing based on inventory availability and shipping costs. This helps select the best fulfillment locations, improves delivery times, and reduces shipping expenses.
Keep your OMS updated with the latest features and security enhancements. Regular updates ensure you benefit from new functionalities that can further streamline processes.
Invest in training for your staff to ensure they utilize the OMS effectively. Well-trained employees can leverage the system’s capabilities to their fullest potential.
Enterprise Resource Planning (ERP) systems are integrated software solutions that manage and automate core business processes across various departments, such as finance, human resources, and supply chain management.
An ERP provides a centralized database that facilitates data sharing and collaboration among different functions.
The main difference lies in their scope: an OMS focuses on order management logistics, while an ERP encompasses a wider range of business processes.
An OMS is designed for businesses focused on order accuracy, fulfillment efficiency, and inventory control, typically less complex than an ERP system
An ERP is best if you need a system that integrates and manages your entire business operations, including financials, HR, supply chain, and procurement
A stand-alone OMS offers flexibility and customization but may lead to data silos if not integrated with other systems. In contrast, an integrated OMS within an ERP framework ensures seamless data flow across business functions.
While an ERP system can handle basic aspects of order management, it often lacks the specialized capabilities required for complex B2B workflows.
Integrating an Order Management System with an ERP allows organizations to harness the strengths of both systems—streamlining operations while enhancing customer satisfaction through efficient order processing and fulfillment
By integrating OMS with ERP, you can consolidate all data into a single platform for a unified view of inventory, orders, and customer information. This is especially beneficial for B2B businesses managing multi-store or international operations with complex eCommerce integrations.
Faster order fulfillment and proactive communication improve customer satisfaction as you can share real-time updates on all orders and your customers can track them as well.
OMS to ERP Integration also enables businesses to offer customized pricing, discounts, and catalogs to B2B customers based on data from the ERP, leading to a more personalized B2B buying experience.
Optimized inventory management and automated processes lower operational costs associated with manual labor and inefficiencies.
When an order is placed, the OMS checks inventory levels and selects the best fulfillment location, whether it's a warehouse or a retail store, optimizing shipping times and costs.
Integrated systems facilitate better tracking of transactions and inventory levels, making it easier to comply with regulatory requirements and generate accurate financial reports.
B2B transactions are often complex, involving bulk orders, recurring orders, and custom terms. OMS and ERP integration helps manage these complexities by automating processes like approvals, multi-location deliveries, and credit checks.
The integrated system can also adapt to changing market needs without significant disruptions, allowing businesses to scale operations efficiently.
Better coordination between OMS and ERP improves picking accuracy and shipping efficiency, reducing errors in order fulfillment. With real-time data from both systems, businesses can make more informed forecasts and improve procurement strategies, ensuring better supply chain management.
A unified view of inventory across all sales channels ensures consistent customer experiences, increasing engagement and loyalty. By integrating OMS with ERP you can consider offering your B2B customers Buy-Online-Pick-Up-In-Store (BOPIS) with a seamless shopping experience.
Implementing a cloud-based OMS with ERP and various data sources, such as warehouses and distribution centers, will provide a comprehensive view of inventory availability. With integrated systems, you reduce the risk of overselling or stockouts and improve customer satisfaction.
It also improves collaboration between suppliers and vendors as they are updated with the latest order details and real-time inventory levels, helping them manage production and delivery efficiently.
B2B order management often means dealing with complex and large orders. Integrating your OMS with an ERP will help you free up staff and allow them to concentrate on higher-value tasks like:
Workflow automation—such as order processing and invoicing—reduces manual tasks, speeds up order processing, and minimizes errors.
Here’s a list of some of the best and most compatible OMS and ERP integrations:
The decision between choosing an OMS and/or ERP depends on your operational complexity and growth plans.
Small businesses often choose stand-alone OMS solutions due to their focused functionality and lower costs.
Go for an OMS when:
An Order Management System allows small companies to efficiently manage orders without the complexity of a full ERP system.
Best for Retailers, eCommerce businesses, and B2B companies that prioritize efficient order management and fulfillment, especially across multiple channels.
Scaling medium and large enterprises prefer ERPs for their comprehensive solutions that manage multiple operations simultaneously.
Choose an ERP when:
Best for mid-to-large-sized enterprises or businesses with complex operations that require in-depth financials, inventory management, HR, and supply chain management.
In some cases, integrating both an OMS and an ERP is the best solution, especially for businesses requiring complete control.
Go for an OMS and ERP integration if:
Best for large enterprises, fast-growing businesses, or companies with complex order processes, multiple sales channels, and detailed financial requirements.
As B2B transactions often involve complex workflows, large supply chains, multiple sales channels, and high order volumes, the need for order management becomes imperative.
If you're B2B eCommerce business needs better order management, investing in an Order Management System (OMS) is a no-brainer. An Enterprise Resource Planning (ERP) is ideal if you need a comprehensive business management solution. And if you're a larger business with complex workflows, integrating your OMS with an ERP can take your eCommerce operations to the next level.
Ask yourself these questions:
Choosing the right system for your business is critical, and we’re here to guide you. Whether you’re leaning towards an OMS, ERP, or the power of both, our team can assess your specific needs and offer tailored recommendations.
Ready to streamline your order management process?
What is an Order Management System (OMS)?Why do B2B Businesses need an OMS?Important benefits of using an OMSHow does a B2B Order Management System (OMS) work?Key features to look for in a B2B Order Management SystemHow to optimize Your B2B OMS for peak performance?ERP vs. OMS: Key differences and how to chooseBenefits of integrating an OMS with an ERPOMS and/or ERP: What’s best for you?Summary
