When the global pandemic hit, it forced massive lockdowns in most countries and minimal in-person contact. This caused serious challenges for businesses. A year later, we are slowly repairing and building back our economy. Although COVID-19 still poses a challenge, businesses have found their own ways to adapt.
This especially holds true for the wholesale B2B market. They have responded to the disruption by finding alternate ways to serve their customers through eCommerce, new channels for communication, and, in some cases, unconventional methods. Most businesses made reactive moves to keep up with the competition at the pandemic’s onset, but now businesses are opting for a more strategic approach to deal with current and future challenges. The negative impact of Covid-19 on the global supply chain and the wholesale industry has been tremendous. An estimated loss of 2 lakh crore has been incurred by wholesalers in India.
Before the uprising of Covid-19, the majority of the sales would take place in stores, physically. Customers would prefer in-store shopping over online ordering in the Wholesale B2B industry. Adapting to the new reality, customers have become accustomed to online shopping to comply with the lockdown rules and regulations and to keep themselves safe. Businesses too need to adapt to the new reality. Find out why the Order management system for the Wholesale B2B industry matters today, in a Post-covid world.
What is a wholesale order management system?
A wholesale order management system refers to any and all actions undertaken by your organization that relate specifically to orders placed by wholesale customers. Some of the key aspects of order management are as follows:
- Making sure your orders are in sync with your inventory.
- Building end-to-end workflows for sales orders.
- Getting all of your sales channels together.
- Accessing sales reports and the data related to them in real-time.
- Creating sales orders on specific locations, For example, trade shows.
Many organizations having an order management system (OMS) in place have had an upper hand on the competition by avoiding supply chain disruptions and being able to continue to function smoothly during the pandemic. An order management system integrates with all of your business and communication channels to give an insight of a global view of inventory so you can identify the orders that are in progress, the items being returned, and also manage your recurring orders with ease.
Why does it matter in a Post-Covid world?
- Change in customer buying behavior
It’s no surprise that buyers are now relying more on online sales as compared to before the pandemic when they would prefer in-store shopping. The tremendous increase in online sales has led to an increase in returned goods. Along with this, wholesalers are struggling with the fact that most of the goods that have been returned and not purchased now have to be quarantined for a minimum of three days in case they’re contaminated. How can wholesalers cope with keeping track of a large amount of unavailable stock? And is it possible for them to cope with remaining stock, unaware of the amount of sufficient stock to return to the store or the distribution center to fulfill a new demand?To add to this, organizations have the challenges of a large amount of stock that hasn’t been sold due to the pandemic. They need to make the decision to sell it off cheaply. A lot of valuable space will be used up in both their warehouses and stock rooms when it would be more lucrative to store higher-priced, new and more popular goods. According to Forbes, many organizations are facing 70-80% of their inventory being marked down below cost, just to get it out of stores. Only an integrated OMS can ease this process by managing the complexities of expansive order fulfillment, allowing wholesalers to achieve true omnichannel excellence.
- Performance of businesses with OMSAfter their drop-ship activity trending upwards and the onset of the pandemic, One technology struggled with taking ownership of their inventory. Products were being shipped directly from the supplier warehouses, but the firm couldn’t see past their own warehouses into those of their extended supplier warehouses. With this challenge of lack of visibility in place, they were unable to deliver the best B2B omnichannel experience for their buyers. And, they needed help in allocating orders in a more efficient way. The legacy system that they used only fulfilled orders on a “first come, first serve” basis, and did not focus on prioritizing customer SLAs or competing for other priorities. Other than that, the technology distributor also faced numerous challenges with the tedious, manual internal bidding process for manufacturers which was time-consuming.
The firm now leverages due to an integrated OMS. They can quickly automate the bidding process and can detect the best sourcing options in no time to maximize customer satisfaction and optimize costs for themselves. This solution has helped in increasing their inventory transparency, provided them with dynamic sourcing and fulfillment options, eased collaborations, and created a smooth workflow. They can now prioritize SLAs within real-time visibility into what exact inventory is available to promise. The organization is also utilizing dynamic sourcing to monitor the tradeoffs of shipping from their own warehouses as well as those of their suppliers to fulfill customer orders at the lowest cost and highest service level.
- Preparation for the futureThe challenges in a post-Covid world have made wholesalers realize that they need to prepare themselves and be more resilient for any future disruption and protect future crises for loyalty. Organizations can’t afford to lose more customers due to poor availability across all their channels, as well as poor returns and setup for refunds. They have to ensure that they set up a strong contingency plan and have flexibility in operations that protects them from any potentially harmful trading effects.Organizations that will adapt via technology will continue to be a step ahead of the competitive and evolving world of commerce. They’ll keep on reaching out to customers as to where, when, and how they want to shop. The various techniques to expand omnichannel experiences and fulfillment options, along with the ability to deliver orders strategically, will prove that organizations can continue to evolve and remain a leader post-pandemic.By consolidating data from every channel and fulfillment center, your firm can have access to up-to-date inventory data. Firms can also better enable drop-shipping, split shipments, and fulfillment from multiple locations.
- Supply Chain DisruptionsThe most important takeaway for many businesses is that having the ability to adapt during unprecedented times is unprecedented. Due to the global pandemic, many organizations without an order management system are facing challenges such as having a loss of revenue, receiving negative customer feedback, losing customers to the competition, and margin erosion. These organizations were unable to cope up and adjust to the “new reality” due to a lack of direction and adaptable technology.In contrast, many companies with an integrated order management system in place before the pandemic have seen a rise in areas such as fulfillment, inventory, availability to promise, tracking, customer service, and optimization. An OMS can provide companies with total global inventory transparency, whether the product is on hand, in fulfillment centers, distribution centers, warehouses, in-store, with a third-party logistics provider, or en route to your company.An integrated OMS can build trust through delivery and also by proactively tracking and monitoring orders and sending regular updates to the customer regarding delays or disruptions in the process. An OMS also provides customer service agents with all the necessary tools and resources to further communicate with the customer on resolving the issue, fulfilling the seamless commerce experience.
Systems in the past required a great deal of investment from asset managers who often faced rocky implementations, an ongoing need for custom development, and scalability issues. While the underlying needs still remain quite the same, today there are added complexities: growing adoption of global multi-asset strategies, changing regulatory and compliance requirements, and an increase in operational risk. Order Management System integration, when done correctly, builds a streamlined, automated, and efficient front office. This has led to cloud deployment emerging as a major operational benefit. First and second-generation order management systems were created to serve specific tasks and functions, to support discrete and siloed departments, and as those grew to more areas of the front office, the third-generation OMS began to emerge. Over time, organizations on the buy-side found it difficult to cope up with changes in the market and the evolving needs of their trading desks.
Staying a step ahead of your competition requires using technology. This also means choosing a vendor that invests while keeping the future and scalability of your business in mind. Investment alpha will be discovered in the details, and the details will be found by mining a diverse set of data. In order to stay relevant in the competition, firms need to ensure they are focused on outfitting their teams by providing the best-of-breed tools that will be valuable for years to come.