What are the pillars of an ecommerce business? What are the pillars of any business for that matter? There are many ways to answer the first question. You can perhaps describe the pillars this way: how you manage your stock; how you list, market and promote your products; how you deal with your orders; how you deal with your customers; how you analyse and report on business performance.
We mentioned 5 things there, but to clarify further, there are really the 4 pillars, and there’s the reporting and analytics, which is the foundation of your building. In this post we’re going to talk about the sales order processing pillar, and the operational efficiencies behind it.
Sales order processing directly impacts the success of an ecommerce business. How effectively and efficiently can you deliver the order to the buyer? Buyers have expectation levels when it comes to delivery. The shipping criteria have a very strong bearing on the buying decision, and, for example, 71% of purchases on eBay were shipped free in in 2019.
For sellers, sales order processing prowess boils down to two key factors: firstly, having the flexibility and range of options to have a compelling enough shipping offer; secondly, having in place the mechanics of being able to back that up and deliver on your offers.
In the first instance, marketplaces are reliant on repeat buyers, so they place a high value on a fantastic buying experience, rewarding the good sellers and punishing the poor sellers. Since you’re rewarded on the marketplaces by exceeding marketplace expectations, you need a warehouse, team and system that delivers on the SLAs you’re setting with your customer and the marketplaces. Look at what shipping options your buyer has selected and have a process to prioritise accordingly. Don’t do the 2-day pick, pack and ship orders blindly without looking at the next day orders.
Furthermore, look at your order curve through the day, mapping your resources against that. If a lot of purchases are placed after 7pm on web stores and marketplaces, as is usually the case, then you might need to adjust your shift allocation. Similarly, you might need to make adjustments after studying your daily purchasing pattern too.
Optimising your pick process is common sense. Your fastest moving products should be towards the pick and pack area. If you analyse your stock velocity, you’ll know your fastest moving items. Alternatively, you could have a small number of every product line close by or in the warehouse, and keep a reserve at the back or another warehouse. Map your pick pathways around the warehouse for the optimal pick run, so that your pickers can use the pick list for their walk order.
Systems like Volo Origin allow you to assign a location or walk order, so you can print the pick-list out in walk order sequence. You can either get the furthest away items first and work inwards, or vice versa; it depends on your warehouse. This is far better than simply printing the latest order and picking it.
Synchronise your pick runs to when your shippers turn up, so the first pick run is last night’s orders and today’s orders can come later. If someone orders delivery within 24 hours, you need to be shipping it within a couple of hours. If someone selects a lengthier delivery window, you can deprioritise it accordingly.
For the pack part of the process, consider using scanning so that when you’re putting the items in the box, you can scan the item, ideally with an image to corroborate what you’ve picked, thereby providing a double check. If you buyers receive first time what they ordered, you reduce returns, bad feedback and so on.
Finally, if you have a ‘just in time’ process for some or all of your products, like for back orders, look at your ‘put away’ process. There’s no point putting items away from the goods in area, only to retrieve them for fulfilling the order. With a lean process, your items can sit in your goods in area and you can do your put away after your last pick run.
From the moment you receive an order, until the moment your buyer opens their package and is delighted with what they have – perhaps leaving a comment on their experience as well – you’re on notice to deliver what they ordered at least when they expected it, at the lowest cost to you. There are many ways you can automate and fine-tune your operations to drive up both your effectiveness and your efficiency.
Please get in touch if you’d like to discuss what the optimal sales order processing journey looks like for you.