The numbers of orders created online and number of units sold is directly proportional to each other. OMS is capable of sourcing these orders through different stores, DCs, RDCs and 3PLs. The general trend is that Logistics team in stores, DCs, RDCs and 3PLs will not be able to ship all the units that are sold in a given day. The logistics will have considerable backlog during the holidays such as Thanksgiving. But as the number of units sold per day subsides after Cyber Monday, these same logistics teams are able to ship all the backlog units plus the units sold per day.
Repercussions of Low Performance of OMS
Ramifications of low performance of OMS ranges from lower online sales, logistics chaos, and unhappy customers.
- Inaccurate Inventory Information To E-Store:
High load on OMS slows down the inventory calculation for items. Due to this e-store does not receive the real time inventory information from OMS. The delay in the inventory information makes the e-store inventory information inaccurate and leads to the next issue.
- Over-Sell Or Under-Sell On Inventory:
Inaccurate inventory information at e-store leads to showing available item as unavailable and unavailable item as available. This leads to under or oversell and impacts customer promise on orders.
Effect of overbooking and underbooking the others
- Operational Issues Logistics and Partners:
When OMS is unable to fulfill orders, precious man hours of logistics staff around fulfillment centers is wasted. The logistics team does not have sufficient shipments to occupy their time completely. Similarly, as the holiday season passes and load on OMS is decreased, OMS starts sending the shipments to the fulfillment centers. The logistics team then has shipments more than their shipping capacity
- Poor Customer Experience:
During overbooking, customer orders are backordered and then cancelled. Cancelled orders lead to bad customer experience, as customers are devoid of the items they purchased, with a significant customer experience impact during holidays. This in turn leads to negative feedback and word-of-mouth for retailers, impacting sales.
- Delayed Deliveries Of Orders:
If OMS is unable to keep –up with processing of orders, order fulfillment is late, thereby impacting customer promise.
Effect of low sourcing on logistics