It’s not easy connecting all your sales channels. Making sure that brick and mortar stores, the online store, live shopping channels and others are all in sync can become complicated. Retailers need to get all departments, all sales channels, suppliers and fulfilment operations on the same page. That’s why I’ve put together a list of the top software vendors in omnichannel commerce – to help you skip the software sourcing part.
It’s not an easy task to connect an omnichannel software vendor to existing systems. Fortunately, some companies are really good at it. Others – just good at saying they are.
And here come the knights in shiny digital armor to rescue the day. The following 5 vendors have built omnichannel retail capabilities ready to be plugged into existing retail ecosystems. They are now the go-to elite for large retailers in need of upgrading their IT infrastructure.
5. Kibo – unified commerce.
Number 5 on our top software vendors in omnichannel list is Kibo. In 2015 former Shopatron became Kibo. The company now sports an API-first, microservices based platform that enables B2B and B2C ecommerce as well as order management, inventory systems and point of sale solutions.
The company was founded in September 2000 by Ed Stevens and Sean Collier. Since then, it has evolved into an integrated SaaS platform that connects offline and online orders management, making it easier for customers to purchase from retailers.
The company offers specific omnichannel solutions, most important being:
ship from store
Shopatron targets midsize retailers and its main benefit is the advanced order routing. The platform combines online and offline sales and claims inventory visibility across channels.
great fit for midsize companies
developer friendly and easily integrate-able due to its API-first architecture
headless commerce structure – enables building disconnected systems on existing software structure
good fit for larger retailers that look for a quick roll-out for the solutions listed above
can connect multiple sales channels and direct orders to the right fulfilment point
works for both B2B and B2C commerce
reduced costs and quick roll out
implementations can become costly due to development costs
backend can seem outdated or complicated
analytics may not be its strong point
4. NetSuite Suite commerce
NetSuite was already rocking a great SaaS ERP product and a fully flavored ecommerce solution when it acquired OrderMotion in 2013. Now the company can provide inventory management across channels, a single customer view, business intelligence data and omnichannel order management. In the past years the product has made the company one of the top software vendors in omnichannel with its SuiteCommerce collection of products.
NetSuite started as NetLedger, envisioned as an online accounting tool, that later turned to an wider array of company management tools.
Prior to its Oracle acquisition, Netsuite was very active in acquiring companies itself. In 2013 it acquired Retail Anywhere, a POS solutions company that became its POS commerce solution. In 2014 it acquired both Venda, an ecommerce SaaS company, and eBizNet Solutions, a company focused on WMS (warehouse management system) solutions.
Netsuite has decided omnichannel is a perfect mix when it connects companies focused o separate blocks in the retail chain.
Extensive know how of retail operations management
Integrated SaaS solutions
Great record of acquisitions
Single view of customer across channels
Multi-channel channel inventory view and order management
Extensive list of customers, a lot of them enterprise Oracle customers
NetSuite is “broadly focused”: its solutions work with healthcare, finance, manufacturing and many, many others. That leaves little room for actual retail innovation
The solution is targeted at enterprise customers or midsized to large companies, a lot of them Oracle customers
Complicated to operate and train staff on
Complex pricing and licensing structure
3. New in the top software vendors for omnichannel: VTEX
VTEX was nowhere to be seen on this list 5 years ago. The company started in Brasil as an ecommerce company catering to the local market. It’s innovative technology caught the attention of Walmart as it entered the Brasil retail market. They’ve created a solid presence for the company in the country and expanded regionally in LATAM.
Companies such as Sony, Samsung, Adidas and many others has chosen VTEX as their B2C and B2B multi-channel software suppier.
From all the other companies on this list VTEX is the best in many fields, chief of which is its modern infrastructure, matched only by the likes of Shopify, which is more aimed towards ecommerce rather than multi channel sales.
Great user experience
Headless, API-based ecommerce
Apps marketplace and third party developers
Great developer support
Fast time to market implementations
Not much customisation can be done on the core platform. It’s a multi-tennant cloud platform.
The platform can be sometimes slow
2. SAP Commerce
SAP commerce was once a thriving, innovative company called Hybris. Afterwards SAP purchased it and there’s almost no way to find out how you can implement the software. Just trolling. The solution is good and it used to be number one on this list. Not anymore.
This omnichannel solution is scalable and built on a modern and flexible architecture, that allows interaction with all interfaces. Its order management solution, inventory and commerce application are built to work together seamless and easily connect with other systems.
SAP commerce’s solutions work both B2B and B2C and can handle inputs from multiple inventory sources and outputs on multiple sales channels. Moreover, the solution features a central content management system that enables retailers to push content across a multitude of interfaces.
fully integrated solutions
works B2B and B2C
supports multiple interfaces
works online, offline and on multiple other channels
flexible enough to work with open source technologies
training may be expensive
professionals able to implement and train are hard to find, due to an increase of platform demand
customization and setup can be time and resource consuming
it’s part of SAP
1. Shopify Plus
Shopify is an amazing company and its communication, style, products and company culture really stand out. It used to be the small kid on the block but now, in term of product, market reach and its huge growth in 2020 it really shines.
It makes sense that its core enterprise product can work on multiple channels. It’s incredibly stable as an ecommerce platform, migration is extremely fast, works as a point of sale solution and you can integrate all logistics on it. Plus, it comes with the experience of having more stores on its platform than any other company.
Shopify Plus takes the crown on my list of top vendors for omnichannel software, 5 years after it was not even included here. Kudos, Shopify.
So that’s it – these are the best of breed. Of course, there are more out there that deliver great products and I could name Intershop or SalesForce Cloud . They, however are less inclined to omnichannel or have a really new found love for omnichannel retail. The vendors mentioned above are leading the pack in omnichannel retail implementation, especially for large customers.
You are an ecommerce professional, you are receiving orders from customers and you want to understand how to better fulfill orders. This guide is all about ecommerce fulfillment.
Let’s get started:
What is ecommerce fulfillment?
Good question! Although the term fulfillment is used quite a lot, not everyone has a clear grasp on the whole idea. I mean – why fulfillment? Well, it’s actually a pretty simple concept. Order fulfillment for ecommerce is anything that has to do with fulfilling your promise to the customer. That promise is you’re going to ship the products they’ve purchased, those products are going to be in good condition and they will arrive as soon as possible.
Ecommerce fulfillment also covers the reverse process (also called reverse logistics). That means getting merchandise back from the customer. That type of operations happen:
in case of a package return
when the customer refused the package
the shipping company was not able to deliver the goods
So basically when your ecommerce business is fulfilling an order, it is actually making good on its promise to deliver merchandise in the best way possible. Although the concept is not that really hard to grasp, making it happen is a little bit more complicated. No worries, I’ll walk you through the process.
In order to make sure your ecommerce fulfillment operations work perfectly, you’ll have to look for the answer to four very important questions:
am I moving the goods in the most effective way? This is a question you will always have to be answering to. The answer is usually no. If you have answered yes too many times – you are not really trying that hard. The truth is ecommerce fulfillment operations are evolving very, very fast and there is probably always something you can do better.
am I always shipping the right products? You have to understand that sometimes you will not be shipping the right products. Yup – that’s a fact. It may happen when you’re using a drop-shipping service or when your team is overwhelmed with the number of orders (say during the holidays). You have to minimize these type of mistakes and always strive to improve on the way you do business.
is my team working in sync or are there any communication or operational bottlenecks? Your ecommerce business will not always run smooth. The most common reasons are either the team is not communicating properly or the IT systems are not fully connected (say your order management and inventory management tools are not synced). You have to stay alert and solve these type of issues as soon as possible.
is my ecomerrce fulfillment scalable? You won’t need to ask yourself this question in the first days but eventually you will have to check if your operations are ready to scale if you’re successful. To do so – try wondering what will happen if all of a sudden you were to receive each day ten times as much orders as you’re expecting right now. How about if your sales were to increase one hundred or one thousand times? Would you be ready? How would you manage this change?
The 5 steps in ecommerce fulfillment
Fulfillment is probably the most complex and tedious part of ecommerce. It is also the one thing that is the least talked about in terms of ecommerce. It’s not flashy and it’s not cool. It’s complex, involves a lot of tweaking and a lot of work to getting it right. While most ecommerce guides will point out to the importance of picking the right shade of orange for the “Buy now” button, few will speak of how important fulfillment is.
Just to get a glimpse of how important fulfillment is – think of your car. While having the right color and the right type of leather is important, the car won’t start without an engine. Fulfillment is the engine that keeps ecommerce going.
There are just five basic steps in fulfilling ecommerce orders. Four of them are mandatory and one is optional. Hopefully you will cover this last step as few times as possible. These five very important steps are:
Receiving the orders
Receiving the products
Processing the order
Shipping the ordered products
Handling order returns
Overview of the Ecommerce Fulfillment Process (including returns)
1. Ecommerce fulfillment: Receiving the orders
Customers will place the orders through one of your sales channels. It may be your online store, on the phone or through a mobile application or a pop-up store.
There is a great variety of order management software out there. What matters from a ecommerce fulfillment standpoint is what the order info should contain. Here is the minimal information you will be needing:
who is handling this order (who will be managing the order and who will actually be picking and packing the products)
the customer info – usually name, address, whether the customer is a person or a company, whether the customer has already purchased from your store before
special discounts or shipping conditions – this may happen when the customer has used a voucher or a special promotion and is entitled to a smaller shipping fee, a gift or a bonus product.
order info – total cost, estimated shipping cost, whether the order is prepaid or paid on delivery, and where you will be shipping the products from (either internally from your warehouse or from a drop shipper)
Most of the time, you will be receiving more info from your order management tool but these are the essential blocks of information to keep in mind.
2. Ecommerce fulfillment:Receiving the products
Before moving on to the actual order fulfillment bullet points I have to make a point. You don’t HAVE to fulfill the orders yourself. Some companies outsource their fulfillment to other companies. My advice is you should keep most of your fulfillment operations within your company. You won’t be able to ship products across the globe but you can pick, pack and carefully wrap orders for your customers, especially if you are a growing ecommerce business.
When medium and large online stores are fighting each other over consumer mind share, we only see the marketing and superficial aspect of this battles. But the fact is, underneath all this visible struggles, the real battles are won in the warehouse. Your real chance for success stands in picking, packing and shipping the right products, within the timeframe you’ve promised.
It may seem hard to handle ecommerce fulfillment operations and it sure is. But because it is hard, you have to master it before the competition does. Walmart and Amazon, two of the largest retailers in the world, have also two of the best supply chains in the world. It’s not that these companies have developed spectacular fulfillment operations because of their huge sales but the other way around.
Glad we’ve got that out of the way. Now – what’s the best way you can receive products in your inventory?
It all starts with an order to your supplier. It is usually called a “Purchase Order” as you are placing an order to purchase products. We will assume that you have already set up an agreement with your suppliers and they will ship the products. You will probably pay as you place your order, when the order arrives or at a given time after the order has arrived, if you have agreed as such with your supplier.
How to check the products received from my supplier?
Once the products have arrived at your warehouse you will need to:
verify their integrity – check whether the goods are damaged and if so return those that are damaged
count the number of products – check if the supplier has indeed shipped the correct number of products
check if the product cost is the one agreed upon – if you have agreed to either pay on delivery or at a given deadline you will probably receive an invoice with individual costs split. Check to see whether these costs are those you have agreed upon when placing the order
add the product SKU’s to your inventory management – Standard Keeping Unit or simply SKU is what retailers use to define unique types of products that can be sold. They are used to track goods movement through inventory. The SKU is not to be confused with the product model no, although this can be included. The SKU code is formed using product characteristics (such as manufacturer, size, color etc.) and it is usually used as a barcode or QR code so it can be tracked easily using bar code readers.
add bar codes corespondent to the SKU’s you’ve just issued for the products. You can do this using special bar code printers and special stickers that will be attached to the product package.
once the product is received and marked it will be sent to your storage unit (or warehouse) where it will be placed in a way that it can later be easily picked and packed.
( Basic check list when receiving products from the supplier )
Placing the products in the inventory is a very important part in receiving the products. The better you keep track of where the products are, the less time and effort you will need when picking and packing the products.
How should I store products for ecommerce fulfillment?
When placing the products in storage you need to keep in mind some very important aspects:
not all products are equal: products should be placed according to how popular you expect them to be. Some products will be sold faster and they need to be easier to reach. Either closer to the packing unit or lower on the shelves so they can be easily picked.
however, all products have to have their position in stock clearly assigned and saved. Each SKU should have a clear position in the warehouse. You will probably develop your own warehouse numbering system but you will probably have to add things such as aisles, sections, levels and positions to keep product identification easy and scalable.
Hopefully at this point you have managed to get the products in your inventory, they are correctly marked and stored and you are ready to pick said products for the orders you are going to be shipping.
3. Ecommerce fulfillment: Processing the orders
Once you have the products in the inventory and orders are coming in, it’s time to process these orders.
Order processing is split between four main areas:
movement to appropriate shipping station
What is the best way to pick products from inventory
Picking is probably the most time consuming part of order processing. It also gets a lot more complicated as your business grows and it may be prone to errors. Having more products in your inventory will increase the complexity of picking the right products in the fastest way possible.
If you’ve managed to place the products in the right spots (as stated in the step above – receiving products) your chances of correctly processing orders increase big time. The reason is it will be easier for picking staff to move fast through the aisles and pick the right products.
How does product picking work?
To have a streamlined picking process that works just as well with 10 orders per day or 1000 orders per day you have to decrease the chances for errors. To do so, your picking staff will cycle through these steps:
Receive a pick list – the pick list is a … well … list of items to be picked from the inventory. It may vary depending on how you run your fulfillment operations and what kind of software you are using but it usually contains:
Product location (section A, aisle 3, level 3 etc.)
Product code (usually the SKU)
Quantity to be picked
Product description and image (for quicker identification)
Barcode (usually used to confirm product picking directly into the inventory management system)
Create the optimum route to pick products: usually picking staff will collect more orders to improve efficiency and gather all the products in one trip. This route is usually generated by the inventory management software based upon the warehouse layout.
Pick products and place them either in separate bins based on ordered items or a general items to be sorted later at quality control or packing stations.
Bring products to the Packing Station, where they will be sorted, placed into the right packages, and so on.
( A basic example for a picking list )
How to pack ecommerce orders?
Packing is the next step in the fulfillment operation. Once the products have been picked from the corresponding aisle, shelf or bin, they are sent to the packing station where they will be split into orders and prepared for shipping.
The packing operation is usually split into these further steps:
Choosing the right package – depending on the products shipped, they will be placed into special packages, according to specific needs. For example a wine bottle will be shipped in a different package than say, a dress or a cardigan.
Scanning and marking the package – after the products are placed into the right package, products are usually marked with specific documents, usually used by the shipping company so their transport progres can be tracked. They are also scanned so the inventory management software will register said products as getting ready for shipment.
Adding invoices, product slips or other documents and / or marketing prints – this step includes placing needed orders information or documents (warranty certificate or invoice), as well as marketing materials that should reach the customer (say a discount voucher or a bonus product).
Preparing the package for quality control and shipping
Quality control for ecommerce fulfillment
Once the products are placed in the right package, a quality control station will check for any errors that may happen.
Quality control personnel will usually check for one of the following errors that may appear:
Wrong products: products may sometimes get mixed or the wrong information has been sent somewhere along the order management process. The most important aspect is that quality control will make sure the customer gets what he or she ordered.
Wrong address / customer: sometimes orders get mixed and orders are sent to the wrong customers.
Wrong payment information: there is a multitude of payment options and you do not want to ask your customer to pay something that was already paid for.
Shipping options: maybe the customer opted for a quick delivery option. Quality control needs to make sure the product gets to the customer in the specified time frame. Another shipping mistake happens when online stores work with multiple shipping partners (say one for internal shipping and one for overseas shipping). It is important for the order to be routed to the right shipping partner to avoid delays or extra costs.
Specific order information: quality control also needs to check for specific demands such as gift wrapping or a specific timeframe to be shipped at.
4. Ecommerce fulfillment: Shipping orders
Once the products have been picked, packed and quality control made sure there were no errors in the order management process, the package is ready for shipping.
Online stores usually partner with one or more shipping companies to deliver the goods. The shipping station will check the package weight and direct it to the right shipping partner.
Most shipping companies will provide you with a general framework on how to handle packing and preparing for shipping. Here are the most popular ones:
Oh, returns – can’t live with them, can’t live without them. Just kidding. A clear and friendly return policy is what sets the likes of Zappos.com apart from the competition. They will let you return the products you’ve purchased within 365 days, free of charge and as their return centers will check the products you will be credited within 7 days with the money you’ve spent.
Ecommerce customers love a great return policy and you need to be ready to handle one. The logistics involved in such a return process are usually dubbed reverse logistics. This means you will reverse the steps mentioned above.
Basically you will unship the products, unpack, unpick and un-order everything.
If you offer free shipping, you will have to handle the shipping costs from the customer to your return center (for small and medium companies, the return centers are the same as the fulfillment facilities).
Now, the big problem when getting information on handling returns is that most of the resources out there are either
irrelevant (usually stating how important return policies are or how to market your return policy) or
boring (usually a bunch of text mixed by logistics experts that have no need to explain how reverse logistics work)
What will follow will hopefully be a bit more relevant and a bit less boring. The big idea you have to keep in mind is returns are the reverse process of everything you have read so far.
You will have to tailor the following concepts to your specific company structure, accounting, IT systems and processes.
That being said there are three main areas you need to focus:
1. Getting the products from the customer and into your fulfillment center.
There are usually three main options to do this:
using your shipping partner: most shipping companies offer return services. What they will do is go to the customer, pick up the package and send it back to you. Either you or the customer have to pay for these services. Companies offering free returns also include a special options for customers to use within a certain timeframe, in order to ship products back. This is usually a special voucher the shipping company will then use to charge you instead of the customer.
using your own network of brick and mortar stores: if you also have a network of stores (either classic or pop-up stores) you can direct the customers to these stores to save on shipping costs
2. Getting the products back into inventory
Once the products are back at the fulfillment center you will have to get them back into inventory. The process is similar to what you would do if you were to receive goods from your supplier. The main differences are:
in terms of accounting this operation will be treated differently
products need to be checked for damage or missing items
instead of paying your supplier, you will either credit the customer
3. Returning payments to the customers
Once the products have been checked and returned to the inventory, you will need to issue a refund to the customer and inform said customer of these changes.
And … that’s it.
It may seem complicated right now but keep in mind that thousands of online store owners are doing all these things. Now that you’ve got the basics, you will be able to deal with most of the operation challenges you will face. If there is anything else you need to know – just ask in the comments sections bellow.
So why not bet everything on ecommerce? Why change direction again and include those “old” brick and mortar stores, and warehouses and such? Why build omnichannel retail facilities?
Short answer: because the customer is not a robot. The customer does not have to shop online. It will shop online when it feels better.
Ecommerce is indeed a revolution in the way we do business and indeed it has changed the retail landscape but consumers still exist in the physical world. Consumers do spend time online but they also walk by store fronts, they like to touch the products they buy and they like to see how fashion items, for example, look like in real life.
That means that real life stores will continue to exist. But so will online stores, sales call centers, interactive kiosks and marketplace outlets.
Retailers need to figure out how to connect all these channels. This new wave of customer centric retail is called omnichannel retail. The term means that no matter the sales channel, everything behind the scenes is connected. The inventory is universally available to all stores. The customer info is available on all channels also, so he or she can be instantly recognized and offers personalized. Product info is also available cross channels but most important – Fulfillment can be managed on all possible points so as to serve the customer in the timeliest and most effective manner.
Managing Omnichannel Fulfillment
One of the biggest challenges in omnichannel retail is fulfilling orders cross channels. Today, retailers that deal with both online and offline sales have to split fulfillment in two separate areas, each with specific operations.
The first is offline fulfillment, namely what happens in brick and mortar stores. Offline sales have been optimized to run on a pretty specific supply chain, not very flexible. It starts with the manufacturer, continues with forwarding merchandise to the wholesale buyer and then products end up stored in the retailer’s warehouses and stores.
Because ecommerce came as an addition to existing sales channels, it was added to the existing supply chain as a type of extra store, with its own specific operations.
However things got complicated when the web store had to split into the mobile store, the interactive kiosk, the marketplace outlet and others. Then customers wanted to buy online and pick up offline. But they didn’t stop here: they wanted to order in the store and receive home, ask for inventory info in the offline store and more. Pretty soon they started demanding it so now omnichannel retail is a question of customer service.
Retailers realized that what the retail world is facing is both a huge challenge in terms of customer demands and a huge opportunity. Those companies shifting their business strategies to fit the new, empowered consumer, will be the leaders of tomorrow.
But to do that, retailers need to develop new order management software hubs. These order management hubs need to connect all fulfillment options to all sales channels. That means that all stores, all warehouses, all suppliers, all drop shippers need to be connected and managed by an order management tool that filters orders from all stores, both online and offline, interactive kiosks, call centers, mobile apps and others.
Some companies are handling omnichannel orders just great. Others need to improve their policies and most of all their IT infrastructure. To do that they have to figure out what factors need to be taken into account when fulfilling orders. Here are the top 6 most important:
Most important factors in omnichannel fulfillment
1. Proximity to customer – this obvious indicator will track which is the closest fulfillment outlet that can ship orders to customers.
2. Inventory levels across all fulfillment outlets – that includes inventory levels in the warehouses, stores, goods in consignment, drop shippers or even supplier and manufacturers. Yes, sometimes it can be more effective to ship directly from the manufacturer or the supplier than it would if the goods were shipped from the store or the warehouse.
3. Order split costs – orders that have more than one product per customer sometimes need to be split to multiple locations that have the products in stock. Products can be shipped individually or shipped to a single fulfillment facility (store or warehouse) and then shipped to the customer. Ideally, orders are fulfilled from the same point but sometimes that is not possible. In this case, the order management software should recommend the most efficient route products should take to the customer.
4. Information on customer history – fulfillment has to factor in the customer previous purchases and behavior. Retailers have loyalty programs that offer better costs and features to more loyal customer. A speedy fulfillment, complimentary gifts or just a thank you note may be outputs from the customer history.
5. Fulfillment capacity per location – estimating the maximum fulfillment load for each location can help prevent overload situations where store associates have too much orders to fulfill and can’t manage their day-to-day tasks. It can also prevent overloading several warehouses and leave others with zero workload, just because a specific area has placed more orders.
6. Seasonal fluctuations – stores get really crowded on holidays and store associates are way better answering customer questions than they are packing orders. Seasonal fluctuations need to be taken into account when implementing omnichannel retail.