Order Management

What is order management?

What is order management?

Every order undergoes a set of actions in the background until this order is received. This process is called order management, and it includes finding the items described in the order, packing them together, shipping them, and notifying the customer of the current status of their order.

Start using an order management system instead of dealing with every order as you go and treat every order as part of your supply chain management system.

Order Management Process

Order management stages can be broken down into four steps:

  • receiving a customer’s order
  • processing the payment
  • fulfilling the order
  • handling the after-sales processes

Let’s see how each stage works in detail:

Step 1. Receiving the order

Your order management process starts as soon as the customer places their order and pays for it.

Step 2. Payment processing

Once the payment for the order has gone through, your customer should receive an automatic email confirmation that an order has been received and state its estimated arrival date. Invest in secure payment processing to protect your customer’s data from being compromised and offer several payment options to make it more convenient for customers to buy from you.

When you’ve received the payment for each order, the item will automatically deduct from your available inventory. If you’re selling across multiple channels, this is where an order management system would offer real-time order updates to avoid overselling.

Step 3. Order Fulfillment

As soon as an order has been received and paid, order details sync to the warehouse. The ordered product must be picked up, packed, and shipped to the customer.


When the order details reach the warehouse, the warehouse manager prepares a picklist containing items for collection from inventory storage, including product SKU, quantities, and locations. Creating picklists makes the process of picking more time-efficient and accurate.

Once all the items from the picklist are collected, they move to the packing area, commonly known as the warehouse packing station.


The personnel working at the packing station are responsible for ensuring that the products are packed appropriately before leaving the warehouse. Often there are different products in a single order, so they have to be bundled together before shipping them.


After the order has been picked and packed, the warehouse personnel can start preparing the shipping documents, including shipping labels, invoices, and customs forms if it is an international shipment.

Like the shipping labels and customs forms, some of them are attached to the order packaging when documents are printed. The remaining ones go inside the parcel, which is then shipped off to the customer.

To learn more about the shipping process and strategies, check our Beginners Guide to Ecommerce Shipping.

Step 4. Returns and refunds

Once the order is shipped, the company sends the customer’s tracking details and estimated delivery date.

If the product is returned, it makes its way back to the company’s inventory. Before it does, follow up with your customer once your tracking system determines that the order has been delivered. Doing this shows quality customer service and ensures your customers stay in the sales funnel. It also gives your customers suitable contact methods if something is wrong with their order.

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