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Shopify omnichannel order management

7 Critical Capabilities of a Shopify Omnichannel OMS

by Anil Patel |

Big-box retailers like Walmart and Target provide lightning-fast deliveries. Consequently, customers expect the same delivery capabilities from Shopify retailers. Omnichannel strategies such as Buy Online Pick-Up In Store (BOPIS) and Ship from Store are essential for Shopify retailers to ensure faster delivery. Shopify retailers need an Order Management System(OMS) that offers these omnichannel strategies to remain competitive.

Choosing the best Shopify Omnichannel OMS can be difficult. First, you need to understand the most critical capabilities any retailer needs from their Shopify Omnichannel OMS.  By investing in an OMS without these capabilities in mind, you risk purchasing a system that ultimately falls short in helping achieve your business goals. 

HotWax Commerce has worked closely with enterprise retailers using Shopify as their eCommerce platform to successfully implement omnichannel strategies such as Pre-Orders, same-day BOPIS, and Ship From Store. In doing so, we’ve developed a list of the most critical capabilities that retailers should look for in Shopify omnichannel OMS. Below we will dive deeper into the importance of these critical capabilities.

1. Inventory Synchronization with Shopify

When you bring a Shopify Omnichannel OMS into your tech stack, it becomes the master of inventory availability for all storage locations. It is essential for the OMS to send accurate inventory counts to Shopify to avoid overselling and underselling. There are two crucial elements for synchronizing inventory across systems:

  • The OMS should take morning inventory feeds from your Enterprise Resource Planning System (ERP) or Store Inventory Management (SIM) System and Warehouse Management System (WMS) to get inventory numbers from all the storage locations. It is then the OMSs' job to update the inventory counts of each product in Shopify. However, Shopify restricts the number of API calls to ensure the platform’s stability. Updating the inventory count for every product individually can hit the API limits set by Shopify. Therefore, an effective OMS should be capable of making bulk batch inventory updates at defined time intervals. 

  • Retailers receive multiple orders a day in their physical stores as well as other marketplaces. The OMS should reduce the inventory based on all new orders and frequently update inventory on Shopify. When updating inventory counts on Shopify, it expects inventory deltas. The OMS should be capable of calculating inventory deltas, then pushing the inventory deltas of multiple products to Shopify. By ensuring the inventory is updated in Shopify, your team can avoid overselling.

2. Syncing orders from Shopify

One of the major responsibilities of an OMS is to download orders from Shopify and route them to the optimum fulfillment location, which allows the Shopify retailer to deliver the order on time. If orders are not downloaded on time, it could result in order cancellations or fulfillment delays. When downloading orders from Shopify, there are some API limits that the OMS must respect to avoid missing any orders during an order import.

Shopify retailers need an OMS that has the following key attributes for order synchronization:

  • The OMS can import orders in batches through the REST API frequently. Online orders can be downloaded and synchronized in real-time using Shopify’s webhooks, but according to Shopify, their webhooks are not completely reliable. This makes the REST API even more important.

  • Shopify allows a maximum of 250 orders in one API call. However, even with a 250 order limit, an order with multiple line items can still exceed Shopify’s file size limit, resulting in errors during file downloads and eventually lost orders. To ensure no orders are lost, keeping the order limit to a default of 100 orders to avoid any failure in the order downloading process.

3. Shopify Order brokering

As we discussed, one of the major responsibilities of Shopify Omnichannel OMS is routing orders to the optimum fulfillment location so that Shopify retailers can deliver the order on time and save dollars on every order. To achieve this, retailers need a smart Order Routing Engine. Generally, Order Routing Engines route orders based on the expected delivery date,  proximity to the customer, or inventory availability. The OMS should provide flexibility to retailers in defining their order routing rules.

For example, if the retailer is promising same-day or next-day delivery, then the brokering engine should allocate the inventory based on proximity. But, if the order is for standard delivery then the brokering engine should route the order to a warehouse with a maximum inventory count.

The OMS should be able to offer these rules to retailers along with the following additional features:

  1. An option to split orders if all items are not available at one location.
  2. Rebrokering of unfulfilled orders in case of order rejections.

4. Shopify Order Fulfillment

Online orders can be fulfilled from stores in two ways: regular orders brokered to the store and BOPIS orders. An effective OMS should be able to provide a Fulfillment app and a BOPIS fulfillment app for supporting Shopify order fulfillment activities. If a Shopify retailer is using Shopify Point of Sale, these apps should be able to embed within the Shopify Point of Sale to avoid having to train staff to use a new app. If the retailer is not using Shopify Point of Sale, then these apps can be utilized as stand-alone apps. 

To optimize your Shopify Order Fulfillment, these apps need to include the following features:

BOPIS Fulfillment App:

  1.  Notifies store staff when they receive new BOPIS orders
  2.  Visible list of pending orders to be prepared for customer pick-up 
  3. Notifies customers when their order is ready for pick-up 
  4. Ability to mark an order complete once it is handed over to the customer
  5. Ability to reject an order and log inventory variance due to unavailability at the store

Fulfillment App:

  1. Notifies store staff when they receive online orders
  2. Visible list of pending orders to be prepared for shipment 
  3. Allows store managers to create picklists and assign pickers for lists
  4. Generate labels through 3PL integration.
  5. Get quotes on the best shipping rate 
  6. Send tracking code to Shopify once the order is shipped
  7. Ability to reject orders and log inventory variance due to unavailability at the store 

5. Financial feeds from Shopify to Enterprise Resource Planning (ERP)

When orders are marked completed and payment is captured, it is recorded as a sale. Because the OMS is already integrated with eCommerce, ERP, and Return Management System (RMS), it should be a reliable source to push the sales and refund feeds to the financial system. The OMS should be able to automatically send daily financial feeds to the retailers’ accounting teams at the end of each day. 

6. Financial Auditing of Shopify Sales

Sometimes, Shopify retailers observe discrepancies in the sales total during the month-end reconciliation process within their eCommerce, OMS, and Enterprise Resource Planning. When these discrepancies occur, retailers have to spend a lot of time identifying the cause. 

While evaluating a Shopify Omnichannel OMS, retailers should check if the OMS has Retail Auditing Software that can automate the month-end sales auditing process. The Retail Auditing Software calculates and compares the daily sales total across Enterprise Resource Planning, the OMS, and eCommerce. In case of any discrepancy between the sales totals of various systems, the software will be able to identify the missing line item and report it to the correct party in the organization. This helps retailers find out missing items in the report that are leading to the difference between sales totals and can resolve the issue with ease.

Completing daily sales reconciliation and audits of sales totals within different systems helps retailers increase the productivity of their account teams and ensures an error-free system integration.

7. Shopify Reporting and Analytics

Shopify retailers want to constantly track their omnichannel strategy’s performance with defined KPIs. Reporting and analytics can also help retailers identify gaps in their Shopify Omnichannel OMS and improve performance. Shopify offers some out-of-the-box reports on business performance, but retailers need supplemental reports to measure their omnichannel initiatives. Your OMS must be able to generate omnichannel reports. Some important reports are

  • Pre-Order Reports: The OMS should provide Pre-Order performance reports so that they can measure and improve their Pre-Order initiatives.

  • Demand and Sales Reports: The OMS should provide daily and region-wide sales and performance reports to accurately gauge retailers’ demand and sales performance.

  • Order Fulfillment Reports: As the OMS is routing orders for optimized fulfillment, it should be able to provide detailed reports on fulfilled and unfulfilled orders.

  • Return Reports: The OMS should provide a detailed report on order return rates that can help identify the causes of returns, minimize returns, and reduce processing costs. 

These reports can help Shopify retailers gain a thorough understanding of their processes, identify negative trends or gaps in efficiency, and ultimately drive business growth.

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Shopify retailers need an effective Shopify Omnichannel OMS to get an edge over their competitors and improve the customer experience. HotWax Commerce OMS includes the key capabilities every retailer needs to improve their Shopify order management.  The HotWax Solution complements Shopify omnichannel strategies to help businesses maximize revenue and grow. To learn more about how HotWax Commerce OMS can help you increase efficiency while eliminating avoidable inventory errors talk to our team today.