Effective order management is the backbone of a successful business. Since customer expectations rise, the need for a robust centralised system for order fulfilment, stock updates and management is higher than ever.
For Magento store owners, there is a powerful solution — Magento Order Management System. It's designed to streamline complex processes, reduce errors and offer an exceptional experience from checkout to delivery.
Today, you'll find out what Magento OMS is, how it works and why it is a complete game-changer for your business. Whether you're managing a single- or multi-source inventory, we'll help you understand the full scope of the OMS and how you can put it to work to benefit your business.
Let's start with the basics.
What is Magento Order Management System?
The Magento Order Management System (OMS) is a solution that offers merchants a centralised way to manage orders through the entire lifecycle — from placement and processing to shipping and returns.
It goes several steps higher and, unlike basic order systems, centralises order management across multiple channels, locations and suppliers.
So, in simple words, Magento OMS is a system that bridges the gap between your online store, shipping carriers, warehouses and retail locations, if there are any.
But the best part is, it makes order processes optimised and automated without the extra complexity. You get real-time updates about inventory levels, shipping, order statuses and refunds, which allows you to provide more effective and timely support.
Key Features of Magento OMS
The power of Magento OMS lies in automation, flexibility and real-time data synchronisation throughout all the order stages. These are the features that help businesses to improve order processing:
1. Centralised order management
Magento order management system makes managing high volumes of orders from multiple channels easy. You can view, update and manage orders from your Magento store, Amazon, eBay and other sales channels from one single interface.
2. Real-time inventory updates
The last thing you want when selling in multiple locations is to run out of stock. That's something that never happens with Magento OMS.
It synchronises data between all fulfilment locations in real time. So you always see relevant inventory information and can restock in time.
3. Streamlined order fulfilment
Processing orders is easier than ever with the order management system in Magento. It provides data on all orders, their sources and processing messages in one panel.
You can track the number of processed orders, view expected shipping dates and locations. Besides, the system tracks shipping history, allowing your managers to offer more effective support.
4. Centralised returns management
You don't have to imagine how hectic managing returns and refunds is for multi-source or multi-channel stores. But it doesn't have to be with the Magento OMS.
The system simplifies the return logistics by managing returns and refunds in a centralised interface. It allows you to track returned items, process refunds, and even analyse the return patterns to find potential issues.
5. Better customer support
The centralised nature of the system offers extensive information about customers, orders and systems where they were placed at. Thus, no matter where an order comes from, sales managers can easily track it down.
This takes customer support to an entirely new level. No more lost data or delayed replies.
How Magento OMS Works: From Checkout to Delivery
The Magento order management system manages the order through the entire lifecycle with minimal human intervention.
So, you do little to nothing from the moment customers click "Buy now" on checkout and all the way to delivery or even returns. Every step is automated, optimised and executed by the system.
Let's see how it actually works.
1. Order placement
Once customers place orders in your online store or any other connected channel, the Magento OMS immediately captures them. It stores all the data, like customer details, items purchased, payment methods and status.
2. Inventory checking
Then the system verifies the availability by checking stock across different sources (stores, warehouses, suppliers, etc.). Since all data is synced in real time, the OMS knows exactly where certain items are available.
3. Sourcing and order routing
To determine the source, Magento OMS resorts to customer business rules. It can choose the store or warehouse closest to the customers or the one with the lowest shipping costs.
If the rules allow it, the system even splits the orders between different warehouses for faster delivery or to lower the shipping costs.
4. Fulfilment and shipment
Once the system finds the source, it sends fulfilment instructions and tracks each purchased item through all steps — packing, shipping, and sends customers the tracking numbers.
5. Delivery and notifying customers
After that, when the order is shipped, the Magento order management system integrates with the shipping providers. This allows it to send detailed delivery updates to customers through different channels like email or SMS.
6. Returns and refunds
In case customers request a refund in Magento, the OMS will handle the entire return process. It tracks the returned item, updates the stock and processes refunds. All that automatically, while keeping customers and merchants informed.
Benefits of Using Magento OMS
As you may have already guessed, the Magento order management system is not just about simplifying operations. It's about creating a smarter, faster and easier way to manage your business.
Let's now sum it all up and point out key benefits that make the Magento OMS a strategic decision.
Enhanced customer experience
Real-time order tracking, accurate product availability and delivery time directly influence customer experience. These things impact customers' loyalty and repeat purchases. The OMS makes sure customers get what they ordered at the expected time. No surprises.
Streamlined multi-channel sales
With the Magento OMS, you don't have to worry about order fulfilment, regardless of the number of channels you sell at. The system allows you to manage all orders from Magento, Amazon-like marketplaces, physical stores, etc., from one place.
Reduced number of operational errors
Errors are inevitable as long as humans manage all the processes, especially in a multi-channel sales point. But you can reduce them to the minimum with the system that synchronises all the data and coordinates the fulfilment automatically.
This boosts the efficiency of your team and saves your business from costly mistakes.
Optimised fulfilment and lower costs
No sales manager can find the best source to fulfil the order as fast as the Magento OMS does.
It centralises data about all the sources, inventory availability and carrier rates in one place. So it finds the most cost-effective and fast delivery option in seconds.
Simplified returns and refunds
Returns are a headache for every business. You have to handle the refunds, manage inventory, reply to customers and do other things you'd rather not do.
With the Magento order management system, you don't have to. It processes the refunds transparently and updates all the data in the backend.
Scalable infrastructure for growth
The growth can feel scary if you start getting 10,000 orders a day. But that's not something to worry about if you use the order management system. It allows you to add as many warehouses, sales channels or shipping carriers as you want.
The system scales with your business.
Best Practices for Implementing Magento OMS
Implementing the Magento order management system seems logical after you've explored all the benefits. But you have to remember that it's not about just installing the system.
You have to plan the implementation strategically, organise the processes and align them across your enterprise.
Here are some best practices to make that process easier.
1. Define order fulfilment workflows
Although Magento OMS is highly customizable, it works best if you set a defined process. So, before you start configuring the system according to your needs, define your ideal order workflow:
- Map out how many fulfilment centres and warehouses you have
- Define fulfilment routing logic across those centres
- Decide how you want to handle returns and refunds
2. Do some testing on smaller volumes
To ensure effective implementation and management, roll the Magento OMS out in stages. Start with a limited range of products, warehouses and sales channels.
It allows you to test how the system works in real-world scenarios, identify any potential issues and gather some feedback from your team.
Scale it across the entire catalogue only once you make sure it handles all the processes as expected.
3. Check the inventory synchronisation
Since the accurate inventory is the heart of the Magento OMS, avoid any manual updates whenever possible. The connected Enterprise Retail Platform (ERP) and Warehouse Management System (WMS) should sync data in real time without any human intervention.
Pro tip: you can also implement the low-stock notifications as a backup for every warehouse, just in case.
4. Onboard your staff properly
While the order management system does all the heavy lifting, your team still actively interact with it. So, make sure to give hands-on training before rolling out the system.
Your team should know how the order flows through the system, how to handle exceptions, like out-of-stock orders, and communicate with customers.
5. Monitor key metrics and improve
The OMS already improves your operations significantly. However, you should also use the data it offers to spot the bottlenecks, improve fulfilment rules and other processes.
Monitor things like shipping speed, order processing time, return rates and stockout frequency to optimise each part of the order flow.
Magento OMS Challenges
Just like any enterprise-level system, Magento OMS is a complex tool. It requires resources, planning, long-term commitment, and most importantly, a team that can help you implement it properly.
So be ready for some potential challenges along the way.
Implementation complexity
Although you're searching for information on the Magento order management systems, know that it's not for every business. The OMS is designed for medium or large businesses with complex order fulfilment needs.
This, consequently, drags on the implementation challenges. You have to implement multiple systems, e.g. ERP and WMS, define the sourcing rules and customize entire workflows.
This will most likely entail a custom Magento development.
Costs
The complexity of the processes OMS handles involves "complex" prices. Thus, implementing OMS involves higher upfront costs when compared to some simpler order management solutions.
You may have to pay for the developer and integration, the ongoing support, maintenance, and licensing fees in some cases.
Data accuracy
While the Magento OMS may operate perfectly, the connected systems might not, causing inconsistencies and issues. This could influence the entire OMS workflow and affect customer experience.
Scalability
As we've already said, Magento OMS is ideal for complex enterprises. So, if you have a small store with one warehouse and a simple checkout, the OMS might be too much for you.
In this case, you might want to rely on simple order management tools to improve your current processes.
Best Order Management Extensions
Having multiple warehouses and fulfilment points requires an OMS so the orders are fulfilled and tracked properly. But if the processes are not that complex in your store, you might just need to improve a few things in the order workflow.
There are a few ways to do that.
Better Checkout
The customer's journey in your store starts long before checkout. But it is a checkout stage that defines if the customer completes the order. That's why it has to be as simple as possible.
Exactly what is there for. It allows you to:
- set default shipping and payment methods, reducing unnecessary clicks for users
- remove the footer and header to eliminate distractions
- set payment method icons for more user-friendly options
- enable order comments to allow customers to leave order details
Better checkout page with payment method icons
Guest to Customer
If you have the guest checkout enabled, you probably won't be able to get past the order stage with the customers.
Guest checkout limits your marketing opportunities and prevents you from extending your customer database.
But what is the solution if you don't want your checkout to be forced? It's Extension — a tool that converts all guest orders to customer accounts right after checkout. Or, you can do it manually for some specific orders only.
An option to automatically convert all guest orders to customers on specific order statuses
Better Order Grid
Once the order is placed, it appears in your system. That's where your sales managers take it from. They need to check the order details, create a shipment, and see to it that the order is shipped and delivered.
Doesn't seem like much. But with a constant stream of orders, you can face some difficulties.
Those include limited default Magento order grid columns, cluttered order statuses, disorganised bought items and others. That's where the better steps in to help you:
- set order status colours so it's easier to spot the right orders
- remove orders with certain statuses from the grid
- add bought items directly in the grid, along with certain attributes
- delete closed or pending orders from being displayed in the grid, etc.
Customized order grid where each order status is marked with a different colour
Order Editor
Although not very common, it happens that customers mess up with the delivery details, product size or just their personal information.
In default Magento it means customers have to place a new order with the correct details since there is no way to edit any information in the order.
But not with the handy . With this tool you'll be able to edit any order-related information directly on the page:
- customer information
- shipping address, methods, and rates
- billing address and payment methods
- purchased items
Editing (or/and removing) ordered items directly in the order view page
Magento OMS: Yes or No?
After reading about all those benefits, challenges and features the Magento Order Management System offers, you probably know the answer to this question. Everything depends on your workflow, the complexity of your current store setup and needs.
If you plan to scale up your business to more than one warehouse or sales channel, it's worth starting now.
The implementation and onboarding will go more easily. And you probably won't need that many connected systems which reduces the friction at the beginning.
However, with a smaller store and simper setup, OMS might become an unnecessary step. Here it's best to rely on some simpler to cover some specific needs.
