+1 (732) 287-2300

How To Improve Order Processing After The Busiest Holiday Shopping Season

The 2017 holiday season marked one of  the busiest periods retailers have ever experienced. According to the National Retail Federation, holiday retail sales surpassed projections, reaching $691.9 billion, a 5.5% increase from 2016. This year-over-year growth is clearly significant, but our key takeaway is that a record-breaking $138.4 billion came from online and other out-of-store sales….

The 2017 holiday season marked one of  the busiest periods retailers have ever experienced. According to the National Retail Federation, holiday retail sales surpassed projections, reaching $691.9 billion, a 5.5% increase from 2016. This year-over-year growth is clearly significant, but our key takeaway is that a record-breaking $138.4 billion came from online and other out-of-store sales. That’s up 11.5% from 2016. While this startling increase can and should be good news for eCommerce retailers, the amount of orders should also serve as a warning: sellers must keep pace with this demand or risk losing customers (i.e. sales) and brand equity.

How can e-tailers stay ahead? Order processing is an important component of staying ahead, especially when it comes to attracting key demographics. Research from BigCommerce discovered that 67% of Millennials and 56% of Gen Xers prefer to shop online rather than in-store. Ecommerce companies must ensure that their online shopping and delivery experiences are satisfying these two audiences that have strong purchasing power.

The Almighty OMS

Improving software is a good way to keep up with the increasing workload from business growth and sales peaks. One essential tool is an Order Management System (OMS), which can track and facilitate customer orders while also monitoring and updating inventory levels across all channels. A quality OMS can improve order processing efficiency, especially when purchases spike during peak buying seasons. A well-oiled OMS can take some of the weight off the shoulders of eCommerce sellers by eliminating many issues that can occur in the order processing stage. By tracking inventory levels in real time, this solution helps prevent incorrect display of a SKUs’ availability.

For omnichannel retailers, a sophisticated OMS can determine a fulfillment method based on the location of the warehouse or store holding a SKU, so customers receive their order in the most efficient method. Additionally, an OMS can help e-tailers save on the short-term costs associated with processing errors, such as shipping the wrong product or delivering to the wrong location. In the long run, these errors can also hurt a customer’s lifetime value, which can hinder a business’s growth.

Another key advantage of using sophisticated software is its analytical capabilities. An OMS can track sales data for every product. Using the data compiled by an OMS, e-tailers can more accurately project product sales. For example, if data indicates a product’s sales spike in the spring, the brand can manufacture accordingly to limit the risk of being out-of-stock, which hurts brand perception and the bottom line.  

When evaluating OMS, it’s important to know the specific features of a software package. Multi-channel sellers should look for omnichannel capabilities when improving their technology stacks. Growing e-tailers should seek out programs with strength in scaling and adapting to a brand’s changing needs. There is no one-size-fits-all platform, so it’s up to sellers to find the solution that best fits their business needs.  

Speed Up Everything

When dealing with the stress of holiday shopping, customers want the order process and delivery to be as convenient as possible; that means easy and quick. According to Statista, long ordering processes and slow shipping were responsible for 21% and 26% of cart abandonments in 2017, an increase of 2% and 4% year-over-year, respectively.

Improving this process starts at the purchasing stage. If people are buying online from a brand for the first time, they will likely have to input their shipping and billing information. Knowing this, e-tailers should only ask for information that is absolutely essential to fulfill the order. Online sellers should also consider allowing customers to sign in as guests rather than forcing them to create an account. Following up after guests make their purchase to encourage them to set up an account is a smart way to continue communication without inconveniencing their shopping experience. This kind of consideration could be the difference between a lost sale and a long-term customer.

Another concept that has become a staple in eCommerce retail is faster shipping. With more shoppers interested in and accustom to same-day delivery, retailers need to expedite the fulfillment process to adapt to the ever-evolving demands of today’s consumer. According to Dotcom Distribution’s 2017 eCommerce Study, 33.6% of respondents would have more trust in a brand that has fast delivery. This improved image would likely translate to repeat customers and more sales. Datashows that 45% of consumers consider fast shipping to be within two days, emphasizing the already-high customer expectations. The concept of quicker delivery is especially vital for holiday shopping, as shoppers expect gifts by certain dates.

A surefire way to minimize errors and delays is to outsource logistics to an experienced third-party logistics (3PL) provider who has the expertise and resources to accelerate deliveries. Processing, packing and shipping are just some of a qualified 3PL’s areas of expertise.

In addition to full teams of skilled professionals, 3PLs usually possess the necessary technology stacks to facilitate and track the exploding order volumes of the holiday rush to minimize errors and delays. For example, here at Dotcom Distribution, when orders  are ready to be shipped,  3PLs  can use transportation management software (for rate shopping)  and leverage freight relationships to ensure that customers receive their orders on time.

It’s never too early to prepare for your next peak season.. The seeds of success in November and December are often planted in the spring, when the proper 3PL partner is brought on board. By planning in this timeframe many of the issues that can hurt sales and brand opinion, such as fulfillment, processing, and shipping, can be addressed to eliminate potential bottlenecks.    

You don’t have to handle the holidays alone. Contact us or schedule a tour to learn more about how Dotcom Distribution can help your business handle the rising order volumes. Additionally, e-tailers can look to our tip sheet to learn how to avoid the headaches resulting from the peak season.