Why retail companies should use distributed order management systems

With e-commerce quickly evolving and the competitiveness of the market rapidly increasing, retail supply chain managers can no longer afford to ignore the importance of developing an omnichannel strategy.

Between minimizing vendor risk, reducing merchandising costs and streamlining production operations, corporate leaders are responsible for handling a wide range of tasks. However, there is one business function that requires immediate attention from many retailers: distribution and order management.

Managing multichannel inventory
In an interview with Supply Chain Management Review, Sterling Principal Todd Miller explained that one of the essential emerging trends of the industry that companies will want to take advantage of is using distributed order and transportation management systems that consolidate inventory and make fulfillment processes easier.

"Complex, monolithic, back-end systems that take a year or more to deploy will leave retailers vulnerable, eroding profits and customer loyalty," Miller said to the source.

He also added that logistics management will need to be adjusted to better support increasing expectations of shoppers and e-commerce growth. This means finding solutions for making faster, cheaper deliveries and increasing insight into inbound logistics.

Software solutions for retail supply chains
In a white paper recently published by Supply Chain Digest, Softeon highlighted some of the advantages of using distributed order management, or DOM, systems in the retail environment. As explained by the source, DOM solutions focus on order fulfillment and are used to integrate the systems of suppliers and third-party logistics partners to orchestrate better supply chain operations and increase visibility. Below are some additional benefits of using DOM software that were pointed out.

  1. It combines traditional and existing order systems with new ones. This is especially important in omnichannel commerce because as the channels of distribution and delivery increase, businesses are forced to manage additional points of interaction, points of fulfillment and points of return, which complicate the work flow. Utilizing a DOM solution eliminates the need to reconfigure applications currently being used along the supply chain.
  2. It creates clearer business guidelines and regulations that are easier to follow. The software can help establish better governance and control over operations to ensure the company is adhering to important rules and policies.
  3. It collects and interprets complex sets of data. Leading retail organizations understand the importance of using data to gain insight on both internal and external processes. Using an integrated DOM system can provide managers with this essential information in real-time. And, because changes can be made quickly and easily, the solution also gives supply chain executives greater flexibility for making adjustments where and when needed.
  4. It uncovers cost-savings opportunities. The DOM can help managers identify the least expensive fulfillment points and sourcing locations to use, therefore increasing profit margins for retailers.
  5. Inventory management is optimized. A major omnichannel-related issue plaguing many companies is trying to determine how to maintain inventory across channels. DOM systems simplify many of these operations by allowing supply chain leaders to access and manage levels in real time and transfer between network nodes.

Investing in technological solutions for distributed order management can provide retail companies with the platform needed to streamline workflow, increase efficiency, minimize costs and improve transit times.

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