DOMming it down:
What distributed order management really means and why you need it

Let’s assume you’re hosting a garden party this weekend. You’ve always been known as a great party host among your friends and family so you want everything to be perfect. You’re making a shopping list: food, cake, wine, garden lights, some new perennials and soil, and a tent in case it’s going to rain. Also, the kitchen blender you need to blend your famous margaritas, has signed its deal off so you’ll need a new one asap.

Sounds like a laborious day of driving from one store to another, right?

Or, you can sit down, spend 15 minutes clicking all of these items in the shopping basket of your favourite online store, check out, and have them delivered to your door step well before the party.

For you as the customer, this is a great shopping experience.

For you as the retailer, it showcases one of the key benefits of a well-functioning distributed order management system.

I’m sure you’ve heard of DOM many times before and know that it’s vital for the success of retailers in the future. But why is it so important exactly? Because so far, retailers’ systems have been addressing core functions, but have not been equipped to adapt or grow as fulfillment options expand. Traditional order management systems (OMS) – which were designed long before omnichannel existed – aren’t flexible enough to support multiple channels, fulfillment methods, locations and return points. Instead they operate in silos, connecting only single channels to single inventory sources. This is where distributed order management comes in.

In particular, the beef of distributed order management is order orchestration. Order orchestration equals the carefully built rule set within the distributed order management system that is designed to simplify even the most complex order fulfillment cases. These cases can include multiple stores and storage locations, multiple drop shippers as well as multiple product categories within the same order, such as running shoes, house appliances and fruit. The platform calculates the optimal fulfillment process for each item while maintaining a simple, unified customer front.

Besides the fact that your customers will not have to leave your site to find what they are looking for, order orchestration brings a great deal of flexibility in replenishing your orders. Let’s say, for example, that one of your store’s picking slots are full but orders just keep coming in. With DOM in place, you can easily save the sale by transferring these orders to be replenished at one of your other stores (this feature, for one of our customers, turned out to be invaluable at Christmas time!). Enabling your customers to search for, order and receive products when and how they want, is what it’s all about.

Shortly, DOM is order management taken to another level built to meet the needs of modern, multichannel retail. It brings you flexibility, freedom to move, and lets you respond to your customers’ needs.

Ok, sounds like something we should have – but how to find the right DOM provider?

When selecting a DOM, the first thing to decide is whether you want to go with a complete fulfillment system that entails DOM, or an add-on solution. The latter means you are only replacing your order management component, but puts the integration burden on you. When considering these options, it is good to notice that integrating can sometimes mean more work than replacing the whole system, with integration costs adding up to more than the cost of the system itself. Another thing to evaluate is whether the integration will turn out truly seamless, and how to predict the related work load and cost going forward.

End-to-end fulfillment solution that includes DOM is often costlier to deploy and can require more time, but in many cases, this is the most sustainable option and removes most of the risk related to integrations.

Regardless of which approach is used, most grocers still have only little or no previous experience in implementing DOM. Unplanned delays, expenses and compromises can occur. Going live on time and on budget requires careful internal analysis and monitoring. All relevant stakeholders must be aligned to understand how the implementation can affect existing legacy systems and operations. For this, a technology provider with extensive experience in both implementation and consulting of DOM systems is key.

And what all is included in DOM?

Finally, to break down DOM on a functionality level, here’s a list of the key components that should come as part of your distributed order management system:

  • combining multi-channel order aggregation
  • order transfers between various fulfillment locations
  • dropshipping support
  • multi-part ordering: combining grocery and non-food items in the same order
  • various delivery methods within the same order
  • provide a real time view of all of a customer’s purchases across all of the seller’s channels
  • having a single, global view of all inventory available in order to intelligently source the components of the order
  • partial and full return support with configurable return locations
  • real-time order tracking; full customer visibility across channels
 

If you’re considering a DOM deployment, we’d love to learn more about what you’re working on. If we aren’t the right fit, we might be able to point you in the right direction. All of the capabilities mentioned in this article come built-in in the Naveo Commerce platform.

 

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