Top Benefits of Using an Order Management System for E-Commerce

An Order Management System (OMS) is a digital platform that helps businesses track sales, inventory, order processing, and customer fulfillment. It serves as the central hub for managing every step in the order lifecycle—from receiving the order to shipping and post-sale services.

Order management systems are widely used by:

Retailers (online and offline)

Wholesalers and manufacturers

E-commerce platforms

Logistics providers

Before digital systems, businesses managed orders manually through spreadsheets, emails, and paperwork. As commerce evolved, especially with the growth of online retail and multi-channel selling, OMS solutions became crucial to handle growing complexities.

Why Order Management Systems Matter

Growing Complexity in Sales Channels

With the rise of multi-channel selling—online stores, mobile apps, physical stores, and third-party marketplaces like Amazon or Flipkart—managing orders manually became inefficient and error-prone. An OMS integrates all channels, ensuring seamless order tracking and fulfillment.

Who Benefits From an OMS?

Small Businesses – Can automate repetitive tasks and reduce operational costs.

Large Enterprises – Need scalable systems to manage global orders and complex logistics.

Customers – Get faster, more accurate deliveries and real-time tracking updates.

What Problems Does It Solve?

An OMS addresses several business pain points:

Delayed or missed orders due to manual errors

Inaccurate inventory levels, leading to over-selling or under-stocking

Lack of visibility into order status for customers and staff

Complicated returns and refunds process

Here’s a quick overview of problems and solutions:

Problem	How OMS Helps
Overselling due to inventory gaps	Real-time inventory sync across all channels
Manual errors in orders	Automated order entry and validation
Delayed shipping	Streamlined picking, packing, and shipping
No visibility for customers	Automated tracking notifications

Recent Trends and Updates (2024–2025)

Rise of AI in Order Management

In 2024, many OMS platforms started integrating AI and machine learning to:

Predict inventory demand based on customer behavior

Recommend optimal shipping routes

Automate customer service via chatbots

Omnichannel Fulfillment Integration

OMS platforms now support BOPIS (Buy Online, Pick Up In-Store) and Ship-from-Store models. This allows businesses to use store inventory to fulfill online orders faster.

Cloud-based OMS Adoption

By mid-2025, nearly 70% of mid-sized retailers have shifted to cloud-based OMS platforms for easier scalability, accessibility, and integration with third-party services like Shopify, WooCommerce, and ERP systems.

Focus on Sustainable Fulfillment

New features allow businesses to optimize packaging and reduce carbon emissions by choosing eco-friendly shipping methods—an initiative that gained attention after COP28 (2023 UN Climate Summit).

Laws, Policies, and Compliance Factors

While OMS itself isn't regulated directly, it is affected by several laws and policies:

1. Data Privacy Regulations

Order management involves collecting customer data like addresses and payment details. Businesses must comply with:

GDPR (EU)

CCPA (California)

DPDP Bill 2023 (India)

OMS platforms must offer:

Data encryption

User consent systems

Options for data deletion and access logs

2. Tax Compliance

OMS tools must calculate GST, VAT, or sales tax depending on the region. Countries like India and the EU have digital invoicing mandates that OMS tools help fulfill automatically.

3. E-invoicing Rules

In India, companies with turnover above ₹5 crore must generate e-invoices. Modern OMS systems now integrate with the Invoice Registration Portal (IRP) to auto-generate and manage e-invoices.

4. Consumer Protection and Refund Rules

An OMS must be aligned with national consumer protection acts which require:

Transparent return/refund policies

Order status communication

Proof of purchase (digital receipts)

Tools and Resources for Order Management

Here are popular tools and platforms to help businesses streamline their order processes:

OMS Software Platforms

Zoho Inventory – Cloud-based inventory and order management

Shiprocket OMS – Ideal for Indian e-commerce businesses

Oracle NetSuite – Suitable for enterprise-level needs

Odoo – Open-source business suite with order modules

Shopify OMS – Native integration for Shopify stores

Integrations and APIs

Zapier – To connect OMS tools with apps like Gmail, Sheets, Slack

WooCommerce REST API – For custom integrations with OMS

QuickBooks & Tally – Accounting software integration for taxes and invoicing

Templates & Resources

Order Tracking Spreadsheet Template (Google Sheets)

Free OMS Planning Checklist (Excel)

E-commerce Fulfillment Guide (available on Shopify Blog)

FAQs About Order Management Systems

What is the difference between an OMS and ERP?

An OMS focuses solely on the order lifecycle, while an ERP (Enterprise Resource Planning) system manages broader business processes like finance, HR, and procurement. However, many ERPs (like NetSuite) have OMS modules.

Do small businesses need an OMS?

Yes. Even small businesses benefit from automating orders, tracking inventory, and managing customer communication. Many OMS platforms offer free or low-cost plans suitable for startups.

Can an OMS help with returns and refunds?

Yes. Modern OMS platforms come with reverse logistics features to handle returns, restock inventory, and automate refunds, improving customer experience and internal tracking.

Is an OMS safe for customer data?

If the system complies with GDPR, CCPA, or local data laws, and includes features like encryption and access control, it’s considered secure. Always check vendor compliance and audit trails.

What happens if the OMS goes down?

Cloud-based OMS platforms usually have 99.9% uptime SLAs, regular backups, and failover servers. Some platforms also offer offline access or mobile apps for continuity during outages.

Final Thoughts

An Order Management System is more than just a backend tool—it’s a strategic asset that improves efficiency, customer satisfaction, and business insights. As customer expectations for speed and accuracy rise, having an intelligent, integrated OMS is no longer optional—it’s essential.