Running a wholesale business can be challenging. Moreover, wholesale order management can also be tough. So, what will happen if you need to learn how to manage the orders and challenges of bulk selling as a manufacturer? Without the proper method and software, it’s obvious to get lost in the way.
According to fabric research, 46% of wholesalers monitor their order cycle through manual systems. Meanwhile, 19% don’t track their orders at all. It can have a notable negative impact on the success of your wholesale business.
That’s why, you need effective order management software to master your wholesale order management. So that you can streamline your inventory management process and manage your wholesale business, along with multiple benefits, it will also help to overcome the challenges so that companies can supply their products in bulk, on time, and meet customer demands.
In this writing, as you go through, you’ll learn the ins and outs of order management and the facts to consider to maintain a competitive edge in the wholesale business.
What Is Wholesale Order Management System?
We need to know the wholesale business to understand the order management system. It’s buying a large amount from manufacturers and selling smaller amounts to merchants.
Meanwhile, wholesale order management means order fulfillment processes between B2B. These business activities include receiving orders, shipping products, and updating inventory.
Order management systems ensure quick, efficient, and cost-effective order fulfillment. Potential customers will have a better ordering experience. Because it automates and streamlines ordering, saving time on tedious tasks.
It can maximize company orders, providing order tracking, inventory control, and order fulfillment in one location. Through operational simplification and advanced customer satisfaction, an order management system can add value to the wholesale business. It is an opportunity that every business owner would love to seize.
How Does Order Management in Wholesale Work?
In wholesale business, a wholesale manager oversees the bulk purchasing and selling. It begins with suppliers offering products in large quantities at a low price so wholesalers can purchase in bulk. A wholesaler then monitors their inventory to ensure enough products to meet demand.
Wholesalers play an important role here by connecting producers and retailers. It saves both parties time and money. They manage logistics, such as shipping and delivery, which ensures that products arrive at stores on time.
A wholesale business’s order management should include tracking sales and maintaining positive relationships with suppliers and customers. Supply chain optimization aims to ensure customers receive their products on time.
4 Main Challenges of Order Management In Wholesale Business
While effective wholesale order management can drive business success, failing in this area can cause disruptions and losses. It can be challenging and time-consuming to stay in compliance with regulations and manage returns.
It will be easier to manage the problems if we take on these order management challenges:
- Lack of Proper Inventory Management
- Complex Supply Chain Logistics
- Unable To Prioritize Orders
- Maintaining Customer Relationships (CRM)
Challenge#1 Lack of Proper Inventory Management
Lack of proper inventory management causes significant issues for wholesale businesses. Which can lead to stockouts and lost sales opportunities. Meanwhile, overstocking can tie up cash and raise storage expenses. Which leads to waste, especially for perishable goods.
Without effective tracking systems for your inventory, identifying demand trends becomes difficult, making future forecasting difficult. This can lead to inefficient ordering processes, with businesses ordering either too much or too little. Poor inventory management can also cause inconsistencies in financial reporting. Which complicates budget planning and analysis.
Challenge#2 Complex Supply Chain Logistics
Wholesale businesses often go through complex supply chain logistics involving various suppliers, manufacturers, and transportation providers around the world. It is difficult to combine these elements without causing delays or troubles. Wholesale order management software can make a difference here. It allows them to address issues ahead of time.
Furthermore, developing strong relationships with supply chain partners improves communication and collaboration. It results in smoother operations and reduces the risk of trouble.
Challenge#3 Unable To Prioritize Orders
Unable to prioritize orders refers to struggling to determine the order to fulfill customer requests. This can happen due to a lack of clear guidelines, an overwhelming volume of orders, or inferior inventory management.
Deprioritizing orders causes a potential loss of business. Furthermore, resources may be misallocated, resulting in inefficiencies and higher operating costs.
To address this problem, businesses should establish criteria for urgency. Such as delivery deadlines, customer status, or order size. The implementation of a real-time tracking and update system can also streamline the process.
This criterion facilitates the efficient and timely processing of sales orders by matching available materials to sales orders. Ultimately, prioritizing orders is essential for maintaining customer satisfaction and optimizing workflow.
Challenge#4 Maintaining Customer Relationships (CRM)
Customer relationship management and meeting expectations are important for business success. Businesses should prioritize customer feedback and open communication. Strong relationships promote customer loyalty and encourage them to recommend the business.
Being open and honest about procedures, such as shipping times or delays, helps establish trust. Providing high-quality products and knowing customer needs are key to meeting customer expectations.
Moreover, sending customized offers or follow-up messages improves customer satisfaction. Another strategy to keep continuous communication with customers is to engage and value them through social media and emails.
Top 5 Benefits of Using an Order Management System for Wholesale Businesses.
A wholesale order management system offers many benefits for wholesale businesses. It helps them run and deliver better customer service. Meanwhile, handling large orders, managing vast inventories, and collaborating with many suppliers and customers can overwhelm traditional manual processes.
The wholesale order management system shows its power here. You can get a powerful solution to these challenges by transforming how businesses operate, including boosting productivity, lowering costs, and improving customer satisfaction.
Here’s an example of how order management software can be helpful for B2B e-commerce businesses.
Top 5 benefits of the order management system to manage your wholesale business effectively:
- Order Customization For Individual Customers
- Saving Time and Money
- Less Probability of Human Error
- Enhancing Growth Prospects: Reporting and Analysis
- Proper Inventory Management
Benefit#1 Order Customization For Individual Customers
Order customization is one of the most helpful features that an order management system offers. It’ll allow businesses to tailor orders based on specific customer needs. Such as unique product configurations or quantities. Merchants may also mix and match orders and select different types or sizes. Increased customer loyalty and satisfaction result from this personalization.
Here’s a tutorial on how you can mix and match orders using the Shopify Bulk Order app.
Benefit#2 Saving Time and Money
Automating the ordering process reduces the time spent on manual tasks.
Don’t you think your B2B sales team could be nurturing leads and closing deals for every minute they spend on manual processes? It is time-consuming and unnecessary to handle sales orders over the phone.
Using an order management system will allow the sales team to spend less time on repetitive order entry and more time on selling.
Benefit#3 Less Probability of Human Error
Using order management software reduces the chances of mistakes in order processing. Automated systems guarantee accurate order recording and fulfillment while streamlining the process.
Because no one is to blame when it’s easier to lose control of orders when revenue comes in via different e-commerce channels. Businesses can enhance overall performance. Also, strengthen customer relationships by implementing an order management system.
With direct access to information about your current stock levels, wholesale customers can avoid buying out-of-stock items. This is how they maintain better inventory control.
Benefit#4 Enhancing Growth Prospects: Reporting and Analysis
Wholesale order management software often includes reporting tools that provide insights into sales trends, customer behavior, and inventory performance. This reporting and analysis is one of the main assets in managing and growing a wholesale business. It helps businesses make informed decisions for growth.
Moreover, order management software often contains analytics tools that provide valuable insights. It allows businesses to generate detailed reports on sales, customer buying patterns, and inventory levels.
Benefit#5 Proper Inventory Management
Inventory management is the biggest challenge in the wholesale business. Keeping the proper inventory balance is essential. Because too much inventory demands money and increases storage costs. Meanwhile, too little inventory can result in stock-outs and decreased sales. Both are hindrances for a wholesale business.
Order management software helps businesses avoid overstocking and understocking. It provides up-to-date information on stock levels through real-time inventory tracking. Reduces inventory risks as well.
Moreover, when inventory falls below a preset limit, an automatic function can start restocking. Again, when inventory drops below a preset level, it ensures a consistent supply without the need for human direction.
Facts To Consider When Selling To Wholesale Customers
Selling to wholesale clients is a difficult process that needs careful consideration. Businesses need to consider many aspects of their wholesale strategy to succeed in this market.
Below are the key facts to consider when selling to wholesale customers:
Fact#1 Set Your Price Properly
Wholesale pricing differs from retail pricing. It’s because wholesalers purchase in large quantities so they expect discounts. It allows them to maintain healthy margins when reselling.
To develop a sustainable wholesale pricing strategy, businesses should design a cost structure. Which can ensure that you are covering production costs while making a profit at reduced wholesale prices.
Offering bulk discounts and tiered pricing based on order volume, encouraging larger purchases. Also, research industry standards and competitors’ pricing to remain competitive while maintaining profitability.
Moreover, setting a minimum order quantity is essential in wholesale transactions. It helps ensure that the business benefits from economies of scale in production and distribution.
Fact#2 Keep The Order Management System Organised
Keeping an order management system organized is essential. It ensures efficient operations and smooth order processing. To maintain an organized system, start by updating customer, supplier, and inventory data. It helps to prevent outdated information from causing delays or errors.
Moreover, implement clear categorization and labeling for products, orders, and customers. Which makes it easier to track and manage records.
An Overview Of Wholesale Order Management
Being an expert in wholesale order management has a significant impact on your company’s efficiency and profitability. Businesses can guarantee more efficient operations and long-term growth by understanding its complexity, utilizing technology, and following best practices.
You can even match your wholesale orders to the stock that is on hand in your distribution warehouse. Having an online wholesale ordering system in place will improve order fulfillment accuracy, customer retention, and team communication.
FAQs
How do wholesale online ordering platforms and wholesale OMS software collaborate?
Wholesale online ordering platforms and wholesale OMS are interconnected to each other. A wholesale online ordering platform helps to leverage the power of wholesale order management software to manage a wholesale business successfully.
What is online order management?
Online order management refers to confirming, following, and fulfilling customer orders via a platform. The process begins with the placement of an order and ends with the customer receiving their package. It tracks and manages orders, sales, fulfillment, and delivery. Also, communicates with the inventory management system to monitor inventory and supply tiers. It also enhances your e-commerce team’s productivity and efficiency.
What is a B2B order management system?
The B2B Order Management System tracks inventory worldwide, sales, fulfillment, deliveries, and returns. B2B platforms contain a wide range of innate complexities, so it can be tough to develop an order management system to handle them.
What is the significant difference between B2B and B2C?
B2B companies prioritize strategies that generate qualified leads, offer consistent responses throughout the sales funnel, and provide committed support. B2C strategies focus on attracting interested parties, promoting rapid purchases, and providing effective customer support.
Is wholesale business better than retail?
Wholesale purchasing allows you to get products at a lower price because you are buying in bulk. It is more suitable for businesses or individuals who require large quantities. Buying retail allows you to buy in smaller portions and often has a variety of products, but it is usually more expensive.