---
title: How to Route Orders to the Closest Fulfillment Center
description: How to route orders to the closest fulfillment center for same-day delivery, and when closest is not best because of stock, capacity, or cost.
image: https://www.hotwax.co/hubfs/blog-image-omnichannel-order-routing.png
---

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[Order Routing](https://www.hotwax.co/blog/tag/order-routing)

---

# How to Route Orders to the Closest Fulfillment Location for Same-Day Delivery

 31 Jul, 2020

![US map showing a $20 shipping saving by routing an order to the closer New Jersey fulfillment location instead of California](https://www.hotwax.co/hs-fs/hubfs/blog-image-omnichannel-order-routing.png?width=960&height=498&name=blog-image-omnichannel-order-routing.png)

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Shoppers now expect same-day or next-day delivery as a normal option, not a premium one. Retailers with stores already hold inventory close to most of their customers. The question is how to get each online order to the location that can ship it fastest, without driving up shipping cost or emptying the shelves walk-in shoppers depend on.

That is the job of [smart order routing](https://www.hotwax.co/order-routing). In this post, we explain how to route orders to the closest fulfillment location, when the closest location is the wrong choice, and how to set up fallbacks so orders still ship on time when the first choice cannot fill them.

 

## What is smart order routing?

[Smart order routing](https://www.hotwax.co/solution/configurable-order-routing) is the automated process of assigning each incoming order to a fulfillment location, such as a warehouse or a store, using a set of rules. The routing engine is a core part of a [distributed order management system](https://www.hotwax.co/blog/what-is-distributed-order-management-system-and-why-do-retailers-need-it), which treats inventory across all locations as one shared pool.

Done well, routing lets a retailer save sales that a single warehouse would miss, shorten delivery times, lower shipping cost, and sell more inventory at full price. It is also what makes affordable same-day and next-day delivery possible, because stores become fulfillment points without the cost of opening new distribution centers.

 

## How to route orders to the closest fulfillment location

Routing to the closest fulfillment center or store starts with location data. Record the latitude and longitude of every store and warehouse, and convert each customer's shipping address to coordinates. The routing engine can then measure the distance between the customer and every location that has the item.

From there, closest-location routing takes four steps. First, set a proximity limit, such as 100 miles for same-day and next-day orders, so the engine only considers locations that can deliver in time. Second, sort the eligible locations by distance, so the nearest one with stock is tried first. Third, group urgent orders into their own batch and route that batch before standard orders, so same-day orders claim nearby stock first. Fourth, run routing often enough for the promise you make. A retailer offering same-day delivery might route expedited orders every few minutes and standard orders a few times a day.

 

## When the closest location is not the best choice

Closest is a strong default for expedited orders, but it is one input, not a strategy. Four things can make the nearest location the wrong pick.

**Stock:** A store may show one unit, but that unit might be the last one on the floor for walk-in shoppers. Safety stock, covered below, keeps routing from taking the units stores need for in-store demand.

**Capacity:** A busy store can only pack so many orders a day. A daily order limit per store sends further orders to the next closest location once the limit is reached, so no single store gets overloaded while others sit idle.

**Cost:** If the closest store has only part of the order, filling it from two locations can cost more than shipping everything from one location a little farther away. A minimum shipment value before an order can split keeps low-value orders in one box. Our post on [why shipment value matters more than split rate](https://www.hotwax.co/blog/why-shipment-value-matters-more-than-your-split-rate) covers this trade-off in detail.

**Inventory health:** Standard orders with a three-to-five-day window do not need the closest location. Routing them to the location with the most stock of the item rotates inventory and keeps nearby stores stocked for urgent orders.

 

## Build fallbacks that loosen one rule at a time

A single rule rarely fills every order. A better approach is a sequence of rules that starts with the ideal location and relaxes one constraint at each step. For same-day and next-day orders, a typical sequence looks like this: warehouses within 100 miles first, then any store or warehouse within 100 miles, then any location within 250 miles, then any location with no distance limit. Only the last rule allows the order to be split.

Orders that no rule can fill should not disappear. Park them and retry them on the next routing run as inventory arrives, with an automatic cancellation date so customers are not left waiting indefinitely. For more on setting store priorities, see our [practical guide to prioritizing stores for fulfillment](https://www.hotwax.co/blog/smart-order-routing-a-practical-guide-to-prioritizing-stores-for-fulfillment).

 

## How shipping zones affect the cost of distance

Carriers price ground shipments by zone. A zone is a band of distance between the origin and the destination, and US ground zones run from Zone 2, the closest, to Zone 8, the farthest. Along with package weight and size, the zone sets the price, so shipping from a location a few zones closer usually costs less and arrives sooner. Carriers publish zone charts for each origin zip code. FedEx, for example, has a [Find Zones tool](https://www.fedex.com/ratetools/RateToolsMain.do?method=SetupFindZones) that returns the zone between any origin and destination zip code. A zone file like the one below lists each destination zip code, its zone, and its ground transit days from one origin.

![Sample carrier zone file listing origin zip, destination zip, zone, and ground transit days from one fulfillment location](https://www.hotwax.co/hs-fs/hubfs/blogs/how-to-achieve-same-day-delivery-with-smart-order-routing/google-1595402641301.webp?width=410&name=google-1595402641301.webp)

Distance-based routing and zones work together. Routing picks a nearby location, which keeps the shipment in a low zone. Then, at packing, rate shopping compares carrier services for that package and picks the cheapest one that still meets the delivery promise, adding savings on top of good routing.

 

## Split orders only when the promise needs it

When no single location has every item in an order, the engine can split the order across locations so the customer still gets it on time. Splitting adds boxes and shipping cost, so treat it as a last resort. Allow it only in the final fallback rule, keep kits and gift sets together, and set a minimum shipment value so a split only happens when it is worth the extra cost.

 

## Turn stores on and off for fulfillment

Some days a store cannot fulfill online orders, because it is short staffed, busy with a local event, or closed. Setting that store's fulfillment capacity to zero for the day takes it out of routing without changing any rules, and orders flow to the next eligible location. Our [ship from store](https://www.hotwax.co/solution/ship-from-store-software) page explains how stores handle the orders they do receive.

 

## Protect store stock with safety stock

Stores need inventory for the customers who walk in, so routing should not send every unit online. There are two places to hold stock back, and they do different jobs.

Store safety stock is subtracted before inventory is published to your storefront. If a store has eight units of a SKU and a safety stock of three, online channels only see five. Shoppers never order the protected units in the first place.

Brokering safety stock works inside routing. It is a minimum number of units a location must have before a routing rule will send it an order. Because it is set per inventory rule, you can make it strict for standard orders and looser for urgent ones. For example, a rule for standard orders can skip any store with fewer than five units, while a same-day rule allows a nearby store to ship its last few units rather than miss the promise.

Keep both numbers realistic. Holding back more stock than stores actually sell leaves inventory sitting on a shelf while online customers elsewhere wait for it.

\*     \*     \* 

HotWax Commerce routes orders with the Order Routing App, where operations teams set up brokering runs, order batches, and inventory rules without code. Online ATP holds back store safety stock before inventory reaches your storefront, and inventory rules filter by facility group, proximity radius, and brokering safety stock, and sort by proximity, facility order limit, inventory balance, or a custom sequence. Store capacity, split thresholds, and parking for unfillable orders are built in. Before a rule change reaches live orders, retailers can [simulate how it would route real orders](https://www.hotwax.co/blog/why-routing-rules-should-be-simulated-before-they-go-live). Learn more about [configurable order routing](https://www.hotwax.co/blog/how-configurable-order-routing-transforms-omnichannel-retail-operations).

[Contact our experts](https://www.hotwax.co/connect) to see how HotWax Commerce can route your orders to the right location for same-day and next-day delivery.

 

## Frequently asked questions about routing orders to the closest location

- ### [How do you route orders to the closest fulfillment center?](https://www.hotwax.co/blog/how-to-achieve-same-day-delivery-with-smart-order-routing#content-1)
  
  Store the coordinates of every store and warehouse, convert the customer's shipping address to coordinates, and have the routing engine sort eligible locations by distance. Add a distance limit for expedited orders and route those orders before standard ones.
- ### [Is the closest fulfillment location always the cheapest?](https://www.hotwax.co/blog/how-to-achieve-same-day-delivery-with-smart-order-routing#content-2)
  
  No. The closest location may not have the full order, may be at its daily capacity, or may need its last units for walk-in shoppers. Shipping one box from a location slightly farther away is often cheaper than splitting an order across two nearby locations.
- ### [How often should order routing run for same-day delivery?](https://www.hotwax.co/blog/how-to-achieve-same-day-delivery-with-smart-order-routing#content-3)
  
  Often enough to meet the promise. Many retailers route same-day and next-day orders every few minutes and standard orders a few times a day, using separate routing runs for each.
- ### [What happens when no location has the item in stock?](https://www.hotwax.co/blog/how-to-achieve-same-day-delivery-with-smart-order-routing#content-4)
  
  The order should move to a holding queue and be retried on later routing runs as inventory arrives, with an automatic cancellation date so the customer is not left waiting indefinitely.

## Related Blogs

### [![Balance scale in equilibrium, for testing order routing rules before they touch live orders](https://www.hotwax.co/hs-fs/hubfs/blogs/how-to-test-order-routing-rules-without-risking-live-orders/How%20to%20Test%20Order%20Routing%20Rules%20Without%20Risking%20Live%20Orders%20banner.png?width=960&height=498&name=How%20to%20Test%20Order%20Routing%20Rules%20Without%20Risking%20Live%20Orders%20banner.png) Order Routing How to Test Order Routing Rules Without Risking Live Orders](https://www.hotwax.co/blog/how-to-test-order-routing-rules-without-risking-live-orders)

### [![Global network of warehouses, stores, and distribution centers, showing how sourcing drives order routing](https://www.hotwax.co/hs-fs/hubfs/blogs/why-order-routing-depends-on-sourcing/Why%20order%20routing%20depends%20on%20sourcing%20banner%20image.png?width=960&height=498&name=Why%20order%20routing%20depends%20on%20sourcing%20banner%20image.png) Order Routing Why Order Routing Depends On Sourcing](https://www.hotwax.co/blog/why-order-routing-depends-on-sourcing)

### [![Glowing AI symbol on a padlock over a circuit board, for trusting an AI agent with real orders](https://www.hotwax.co/hs-fs/hubfs/blogs/can-you-trust-an-ai-agent-to-touch-real-orders/Can%20You%20Trust%20An%20AI%20Agent%20To%20Touch%20Real%20Orders%20banner.png?width=960&height=498&name=Can%20You%20Trust%20An%20AI%20Agent%20To%20Touch%20Real%20Orders%20banner.png) Order Routing Can You Trust An AI Agent To Touch Real Orders?](https://www.hotwax.co/blog/can-you-trust-an-ai-agent-to-touch-real-orders)

### [![Orange directional arrows pointing in opposite directions against a blue sky with clouds.](https://www.hotwax.co/hs-fs/hubfs/blogs/why-shipment-value-matters-more-than-your-split-rate/Why%20shipment%20value%20matters%20more%20than%20your%20split%20rate%20banner.png?width=960&height=498&name=Why%20shipment%20value%20matters%20more%20than%20your%20split%20rate%20banner.png) Order Routing Why Shipment Value Matters More Than Your Split Rate](https://www.hotwax.co/blog/why-shipment-value-matters-more-than-your-split-rate)

### [![3D illustration of bright red arrows navigating through a white 3D maze, symbolizing order routing and process decisions.](https://www.hotwax.co/hs-fs/hubfs/blogs/why-did-this-order-route-there/Why%20did%20this%20order%20route%20there%20banner%20image.png?width=960&height=536&name=Why%20did%20this%20order%20route%20there%20banner%20image.png) Order Routing Why Did This Order Route There? A Practical Guide To Diagnosing Fulfillment Decisions](https://www.hotwax.co/blog/why-did-this-order-route-there-a-practical-guide-to-diagnosing-fulfillment-decisions)

### [![A diagram demonstrating order routing simulation logic in HotWax Commerce.](https://www.hotwax.co/hs-fs/hubfs/blogs/why-routing-rules-should-be-simulated-before-they-go-live/AI%20Powered%20Order%20Routing%20HotWax%20Commerce.png?width=960&height=509&name=AI%20Powered%20Order%20Routing%20HotWax%20Commerce.png) Order Routing Why Routing Rules Should Be Simulated Before They Go Live](https://www.hotwax.co/blog/why-routing-rules-should-be-simulated-before-they-go-live)

### [![Decision making concept showing a yellow paper boat taking a direct path while others diverge.](https://www.hotwax.co/hs-fs/hubfs/blogs/should-your-oms-optimize-for-speed-cost-or-sell-through/Should%20Your%20OMS%20Optimize%20for%20Speed%2c%20Cost%2c%20or%20SellThrough%20Banner.jpeg?width=960&height=540&name=Should%20Your%20OMS%20Optimize%20for%20Speed%2c%20Cost%2c%20or%20SellThrough%20Banner.jpeg) Order Routing Should Your OMS Optimize for Speed, Cost, or Sell-Through?](https://www.hotwax.co/blog/should-your-oms-optimize-for-speed-cost-or-sell-through)

### [![Evaluating order routing software and the inventory data behind it when choosing an omnichannel OMS](https://www.hotwax.co/hs-fs/hubfs/blogs/how-to-choose-oms-intelligent-routing/how-to-choose-oms-intelligent-routing.jpg?width=960&height=498&name=how-to-choose-oms-intelligent-routing.jpg) Order Routing Order Routing Software: 5 Questions to Ask Before You Choose an OMS](https://www.hotwax.co/blog/how-to-choose-oms-intelligent-routing)

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