What’s the ROI of OMS? 

Order management systems (OMS) can unlock tremendous value if your business needs to amp up operational savings and boost top-line revenue. Today, we discuss how your company can save with an OMS. Don’t feel like reading on? See for yourself right now…

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4 areas most influenced

Order management software positively impacts your operational savings, new revenue growth opportunities, and ROI in 4 key areas:

  1. Overselling rate in multichannel operations
  2. Address hygiene, related fees, and shipping bottlenecks
  3. Inventory accuracy in stores
  4. Ability to add new omnichannel use cases (BOPIS, BORIS)

Eliminate multichannel overselling

Overselling inventory occurs when you promise the same unit of an item to multiple customers on different sales channels – i.e. Direct-to-Consumer (DTC) and wholesale or marketplace channels.

When overselling occurs, it results in a stockout. You’ll have to backorder one of the items from the customer order, leading to an order cancellation or the customer waiting longer than expected for you to get more in stock and ship it to them.

Overselling is a substantial issue for many retailers and brands, leading to a 10% cancellation rate on customer orders due to stockouts. In addition, most first-time customers experiencing a stockout-related cancellation will never shop with you again. You wasted dollars acquiring those customers. If you’re doing 500 orders/day, this can add up to a $164,828 problem annually.

With real-time inventory visibility across all your channels, OMS drives immediate ROI by ensuring staff knows the exact available quantities of products – even if they exist in different locations. When an item is sold in one channel, the OMS updates and immediately syncs so that someone cannot order the same item elsewhere and get disappointed. 

Say goodbye to address correction fees

Don’t get caught up with bad address data when creating carrier labels, or the shipping costs can really add up. Let’s look at an example of how OMS creates shipping efficiencies in this area.

FedEx charges $21 per occurrence of having a bad or incomplete address on a carrier label. According to EasyPost, 4.7% of customer orders have bad or incomplete addresses, so if you aren’t catching and correcting them, that can turn into a $180,127/yr problem (assuming 500 customer orders/day). 

Many of these errors pass through natively on the original order header if there is no correction in the customer-facing system. These could include incomplete information, handkey typos, and other innocent – but costly – mistakes and inefficiencies. 

An OMS increases ROI by catching and fixing common address mistakes without slowing down processing time or posing a risk to your SLAs. Automated order validations check each order upon import, removing manual review and avoiding expensive chargebacks. Even if you only have one facility, an OMS unlocks ROI through significant shipping efficiencies.

Increase inventory accuracy in stores

If you have physical retail stores, inventory inaccuracy can be a major problem, leading to stockouts and missed sales. If you aren’t counting your store inventory at least monthly, you are leaving money on the table, equivalent to 6% of your sales split evenly between stockouts and missed sales. 

We have already accounted for some of the stockout-related misses with our overselling capture, but ecommerce only accounted for 22% of US ecommerce sales in 2023. So most of this 6% is available for you to recapture through better inventory management

Some OMS systems, such as Deposco, offer a store inventory fulfillment solution that allows you to manage store inventory counting (which is very different from counting in the warehouse). Be sure to ask about support for this during your OMS evaluation.

Get Answers Today

At Deposco, we have deep supply chain expertise. Let our growth gurus outline your optimal path to long-term ROI with OMS.

Add new omnichannel use cases like BOPIS

Another way to increase your top line is to add omnichannel use cases, especially if you have physical stores. 

It’s a great way to generate additional revenue by capturing customers who want a free shipping option and those who need it today. However, you may be missing both of these categories of potential customers without offering an option like Buy Online Pick-Up in Store (BOPIS). 

BOPIS accounted for 9% of ecommerce sales in recent years. Adding BOPIS can have a hugely positive impact, increasing your ecommerce sales and traffic to your stores where customers will buy additional items at pickup.

How much can you save (and gain) with OMS?

After walking through these 4 different areas of value delivered by OMS, why not estimate your potential ROI from OMS? 

We’ve done the legwork for you! We developed an interactive order management calculator. Answer just a few quick questions regarding your customer orders, and get an estimated value of adding an advanced OMS system to your business.