What Is Distributed Order Management (DOM)?
Quick answer: Distributed order management (DOM) is software that decides where and how each order should be fulfilled. It looks at inventory across your warehouses, stores, 3PLs and dropshipping suppliers, then routes each order (or splits it) to the location that can deliver it fastest and at the lowest cost. DOM makes multichannel selling, ship-from-store and buy online, pick up in store (BOPIS) possible, but it needs accurate inventory data from every partner to work well.
Being familiar with the operation of distributed order management will make it more convenient for you to manage your store’s orders. In today’s competitive retail market, we believe a distributed order management system can help you maintain a sustainable competitive advantage.
If you are struggling with improving your business shipping services, this page will help you learn how to benefit your business with distributed orders.
What is Distributed Order Management?
Distributed Order Management (DOM) is a system that optimizes order execution to ensure that orders arrive on time and at the lowest possible cost. Different from enterprise resource planning (ERP) systems, It allows retailers to maximize order fulfillment. And meet changing demands for the best customer experience.
Advantage
Seamless Multi-channel Selling
If your various sales channels get inventory from a single source, it becomes complicated to sell without DOMS. DOMS can automate, optimize, and coordinate the order fulfillment process. DOMS can track your inventory by sales channel, simplifying management in a clearer way.
Multiple Fulfillment Processes
The distributed order management system also allows orders to be split, which reduces shipping and fulfillment costs across every available channel. This allows for a more granular workflow and extensive monitoring of results.
Global Visibility
Distributed order management applications will allow more global inventory visibility. Connect your international warehouse and third-party logistics system to your system, it’s easy for customers to order and receive products from all over the world. And you can also easily handle inventory management.
Challenges
Extended options
A distributed order management system gives you more options for executing customer orders. While this is very rewarding, it can also be incredibly laborious if you’re not ready to embrace this abundance of options. Too much can lead to paralysis of choices, and even confusion.
To avoid being overwhelmed and help you make a choice, you need to be clear about your goals from the start. Do you want to improve customer satisfaction? Before moving on, set your goals and define any limits.
Separate Companies
As the name suggests, distributed order management involves multiple companies working together for the same goal. For example, if another company calculates inventory differently, it’s hard to monitor your inventory. Distributed order management relies on successful collaboration between numerous organizations.
How does Distributed Order Management Work?
Many retailers now gravitate toward a distributed order management system. They use DOM systems for a number of reasons, including:
Synchronize e-commerce platforms and store locations so customers can shop online and pick up their orders in-store.
Consolidate orders from the same customer to consolidate transportation.
Conduct rate shopping among shipping partners to obtain the best price and meet the delivery date.
Provide customers with a faster experience. Same-day delivery is possible if stock is available.
In general, these features enable your customers to better control when and where they buy, help you track their stickiness, and connect these dots each time they decide to buy from different channels.
What are the Components of Distributed Order Management?
Third-Party Logistics
Third-party logistics (3PL) is the process of outsourcing logistics services.
Your third-party logistics solution can cooperate with Honest FulPhilment. One of the most daunting aspects of third-party logistics (3PL) is the hidden fees and complex pricing structure. Honest FulPhilment charges only two charges for 3PL service-Packaging charges and shipping charges. The same pricing structure applies across its 18+ overseas 3PL warehouses.
Dropshipping Fulfillment Models
Through dropshipping, retailers purchase inventory from brands as needed, and then the brands directly send orders to customers. With this model, you can add a product catalog with zero inventory risk and visit more catalogs of wholesalers and brands.
Ship from Store and “BOPIS”
In the first option, customers can buy online and then complete the order fulfillment to send their orders directly from the store to them. The other is where the customer buys online and then picks it up in-store, which is the BOPIS method of buying.
The advantages of these implementations are:
They reduce residential transportation costs while increasing your profit margins and sales potential.
They greatly reduce logistical challenges and return costs: customers feel more comfortable shopping online because they know they can walk directly into the store to return goods if necessary.
Conclusion
Distributed order management ensures that you can provide your customers with a great experience. When you feel your business is struggling, it’s time to adopt distributed order management.
Honest FulPhilment can help you with order fulfillment and third-party logistics service. Orders from Shopify, WooCommerce, CSV/Excel upload or our open API are routed to our warehouse in China or to 18+ overseas 3PL warehouses, and in-stock orders are dispatched within 24 hours. If you want to grow your dropshipping business, contact us.
FAQ
What is distributed order management?
Distributed order management (DOM) is a system that collects orders from all sales channels and automatically decides which warehouse, store or supplier should fulfill each one, based on stock, delivery time and cost.
What is the difference between an OMS and a DOM?
An order management system (OMS) records and tracks orders through their lifecycle. A DOM adds intelligent routing on top: it decides where each order is fulfilled across a network of locations and can split or consolidate orders.
What is DOM in supply chain?
In the supply chain, DOM is the layer that connects demand (orders) with inventory spread across multiple nodes such as warehouses, stores, 3PLs and suppliers, so orders are fulfilled from the best node.
What are the benefits of distributed order management?
DOM lowers shipping costs, speeds up delivery, improves inventory visibility across locations, reduces stockouts and supports options such as ship-from-store and in-store pickup.