Order Processing Management: Tips and Best Practices for Manufacturers

Brahm Meka
May 15, 2024
10 min
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Manufacturer processing his orders for his business

In the world of manufacturing, order processing management is an essential component in satisfying customer demands, optimizing inventory utilization, and ensuring timely order fulfillment. It involves a series of steps that help streamline the process from receiving an order to shipping it out to the customer. In this blog post, we will look into what order processing is in supply chain management, the specific steps involved in the process, and how to manage your orders as effectively as possible to ensure smooth and efficient operations.

What is order processing management?

Have you ever wondered what exactly is meant by order processing management? It's the intricate web of activities and procedures entwined in handling customer orders from the moment they're placed to the ultimate fulfillment and delivery. It's a comprehensive process, dealing with every step necessary to ensure customer orders are received correctly, processed accurately, tracked meticulously, and fulfilled promptly.

What does this process entail, you might ask? It's a journey that starts with receiving an order, followed by its validation. Next comes inventory allocation, picking and packing items, shipping, and finally, tracking the order. It's like a relay race, starting with the customer placing an order and ending with the successful delivery and closure of that order.

You might be thinking, why is efficient order processing so crucial? Well, it's simple. It's the backbone of customer satisfaction and optimized supply chain performance.

But how do you achieve effective order processing in supply chain management? It's all about the team effort. It requires a symphony of coordination and integration between various players on the field. This includes your sales teams, warehouse staff, transportation providers, and customer service representatives. Everyone has a role to play; when they play it well, the result is seamless order processing.

As a team, you can harness the power of technology to streamline and automate order processing tasks. By doing so, we're not just reducing the possibility of errors or minimizing lead times. We're also optimizing inventory levels and enhancing order accuracy and promptness. The ripple effect? Improved customer service, increased operational efficiency, and a competitive edge in the marketplace. So, are you ready to take your order processing management to the next level?

5 Steps in Order Processing Workflow

Order processing management typically involves five steps, which may vary based on specific organizational requirements but generally follow a consistent pattern:

  1. Order placement: When an order is placed, it's sent to an order management system that decides the best warehouse location to ship from based on delivery address and stock availability. This helps save time and lowers shipping costs. If needed, an order may be fulfilled from multiple locations for timely delivery. If an item is out of stock at one location, it may be sent from another to avoid delays.
  2. Order Processing: After the orders are submitted, they undergo a verification process to guarantee their precision and legitimacy. This procedure entails checking the availability of the products, validating customer information, verifying pricing and discounts, and ensuring that the order adheres to any specific prerequisites or conditions. At this point, the inventory is also examined, and the order cost is accurately calculated. Order processing errors can cost companies up to 50% of their profits.
  3. Order fulfillment: Once your order has been authenticated, it transitions into what we call the 'fulfillment stage'. This is where the actual pick, pack, and shipment of the product occur. In this stage, the order comes to life, moving from a simple customer request to a physical package ready for shipment.
  4. Order tracking and delivery: After preparing the order for shipping, it gets a tracking number. This lets the business and customer check the order's status, from shipping to delivery. It may show estimated delivery dates, carrier details, and real-time location updates once the order reaches the customer. The last step is confirming the delivery, ensuring the customer received the correct, undamaged product.
  5. After-sales support: After the order delivery is confirmed, there may be post-order support, including invoicing, payment processing, handling returns or exchanges, and addressing customer issues.

Further Reading: Sales Order Processing: Definition and how to optimize it for your business?

Effective order processing management is an indispensable element for businesses to meet customer needs, reduce errors, guarantee timely delivery, and uphold customer satisfaction. The process typically entails utilizing order management systems, and inventory management tools and collaborating with shipping and logistics providers to simplify procedures and enhance operational efficiency.

Order processing factors

Does the notion of a "one-size-fits-all" approach to order processing resonate with you? It's doubtful. That's because the reality is far from it! The methods and priorities for processing orders can vary dramatically across different businesses, distribution centers, and carriers. Moreover, these are not arbitrary decisions but are dictated by several key factors. Intriguing, isn't it?

  • Types of products: When it comes to shipping, not all products are created equal. For instance, perishable items like food or flowers often require special temperature and humidity-controlled conditions to maintain their quality during transit. While clothing might not need the same level of care, it's always important to consider the specific needs of each item before shipping them off to their destination.
  • Order qty: When it comes to ordering in bulk, things work a little differently than with small orders. While your tiny package might be sent straight to your doorstep, bigger orders require a little more attention such as they might need to be shipped to a distribution center.
  • Shipping packaging. It is important to note that not all items can be shipped in the same packaging containers. The size of the containers used can greatly impact how they are handled during shipping. Now, imagine for a moment, you're a manufacturer of a popular beverage, let's say, lemonade, which you sell in various volumes. You've got your standard 16oz bottles for the consumers, but then you've also got these massive 50-gallon drums and 250-gallon totes for wholesale customers. Can you just ship them in the same packaging? No, you can't simply because the packaging needs are vastly different for retail and commercial orders. The handling and transportation of larger volumes require special care and techniques. One would not simply box a 250-gallon tote like a 16oz bottle, would they?
  • Individual Packaging: For the smaller retail orders, it's pretty straightforward. The 16oz bottles can be individually boxed and sent out for distribution.
  • Bulk Packaging: However, a different approach is necessary when it comes to the 50-gallon drums and 250-gallon totes. These giant containers need specific packaging and palletizing methods to ensure they get transported without any mishaps.
  • The efficiency of the team. Have you ever wondered if your team can handle the increasing demands of order processing? This factor can significantly influence the decision to integrate automation into the system.
  • Seasonality: During busy shopping seasons, such as holidays, the order processing workflow becomes stressful. Employees need to handle more orders, leading to a longer processing time and delayed customer deliveries.

Types of order processing systems

How can you streamline the complex order fulfillment process, ensuring efficiency and accuracy? The answer lies in order processing systems. These systems are the backbone of your operations, capturing and storing all order-related data, ranging from existing inventory to shipment tracking, in a single, centralized database. The accessibility of this real-time information, on-demand, is a game-changer for all relevant business departments. Imagine your shipping department, for instance, can quickly ascertain which orders need to be dispatched and their respective destinations. Isn't that convenient?

So, what are the types of order processing systems available out there? Let's delve into the two main categories:

  • Traditional order processing systems hearken back to a time when order fulfillment was a manual, labor-intensive process. All tasks, from scribbling down orders on slips to hand-packaging each order for the carrier company, were performed by hand by a dedicated individual or a small team. This same group would also be responsible for tracking all order and inventory data, a Herculean task in its own right.
  • On the other hand, modern order processing systems embrace the power of technology. All pertinent data — inventory, customer profiles, and order processing tasks — is fed into specialized software. This approach significantly reduces the risk of human error while simultaneously expanding the potential for business growth and capabilities. Consider, for instance, a North American retailer effortlessly accepting orders from Europe online and coordinating shipping with a local fulfillment center. Now, that's the future of order processing!

Order processing management system advantages

As a business owner, you know how important it is to keep your customers happy. That's why order processing systems are a game-changer. With these systems, you can easily keep track of all orders from start to finish, ensuring that nothing falls through the cracks. This means fewer mistakes and more accurate packing and shipping. Plus, your customers will appreciate the peace of mind of knowing their orders are in good hands. And when your customers are happy, they're more likely to come back for more – and tell their friends about your fantastic service!

Companies with efficient order processing systems have 3x higher customer retention rates.

Order processing management system disadvantages

Although utilizing order systems can be advantageous, there are certain downsides to consider. In particular, highly advanced or overly intricate systems may demand additional specialized personnel to ensure optimal performance, resulting in increased implementation expenses. Furthermore, on-premises order management software can lead to significant upkeep costs, which may require additional IT personnel. In the event of an error, it can be challenging to locate the root cause, as the software program automatically captures order processing data and is not manually entered by a warehouse worker, who could otherwise retrace their steps.

Top 9 strategies for enhancing your order processing management

Isn't it fascinating how, despite each company's order processing procedures being uniquely tailored to its business operations and customer needs, we all share the common end-game of maximizing accuracy, cost efficiency, and productivity? Let's delve deeper, shall we? Here's a collection of nuggets of wisdom to turbocharge your order processing management and bring those coveted goals within your grasp:

1. Use Demand Forecasting

Understanding the patterns of your busy and slow seasons is crucial for effectively managing your workflow. By accurately forecasting demand, you can strategically allocate resources such as hiring seasonal workers and increasing order quantities to meet your customers' expectations. This proactive approach can significantly enhance the efficiency of your operations.

2. Mastering Workflow Efficiency

For any business to operate effectively, it is crucial that all the various components work seamlessly together. To achieve this, it is recommended that workflows are closely monitored continuously, aiming to identify areas that can be streamlined. Additionally, when it comes to communication, it is essential to simplify the process wherever possible. By doing so, decision-making can be accelerated without compromising on accuracy.

3. Automation

Automation benefits businesses by saving time and money, simplifying worker tasks, and enhancing customer experience. It mainly improves shipping and order fulfillment processes.

  • Shipping: Automation selects the cheapest shipping option considering factors such as inventory, destination, package weight, and size. It also sends automatic notifications to customers regarding tracking and delivery confirmation.
  • Processes: Automation simplifies inventory picking and sorting and improves communication among key order processing personnel. It can generate task lists for pickers, sorters, and packers and helps avoid mistakes and employee burnout.

4. Inventory Accuracy

Managing inventory is crucial for businesses to ensure smooth and efficient order processing. By maintaining up-to-date and precise inventory data, companies can guarantee that customers receive their orders in a timely and accurate manner. However, relying on outdated or manual inventory tracking methods can significantly slow down operations and create room for errors. While manual organization systems that require manual grouping, labeling, and counting of items can be implemented, they are often time-consuming and prone to mistakes. To overcome such challenges, businesses can adopt automated inventory tracking systems that streamline the process and minimize the possibility of errors.

5. Partial Order Processing

Have you ever placed an order and only received part of it? It can be frustrating, but sometimes it's just not possible to fulfill an entire order in one shipment. Take a pencil manufacturer, for example. If they're low on stock, they may only be able to send half of an order for 1,000 pencils to an office supply store. But don't worry, the manufacturer can still process a partial order so the store can have items to sell, and they'll send the rest when it's available. Plus, this flexibility can actually improve shipping efficiency. So if part of your order is coming from a nearby fulfillment center and the other part from our warehouse, we may split the order into several shipments to get it to you faster. At the end of the day, our goal is to make sure you're satisfied with your order, and that sometimes means sending it out in parts.

6. Customer Communication

It's important to communicate and assess customer satisfaction throughout the entire order processing workflow. Informing customers about the status of their orders can give them a sense of control and make them feel more involved in the process.

7. Inventory Control

In addition to predicting market demand, inventory control is crucial in ensuring optimal stock levels. It helps prevent situations where a company may have an excess or shortage of stock. Effective inventory management can lead to significant cost savings by enabling a business to purchase only the necessary volume and selection of products that can be sold. To achieve efficient inventory control, companies must incorporate various data points, including recent purchases, reorder rates, customer satisfaction, and turnover. By leveraging these metrics, businesses can make informed decisions and ensure their inventory is continually optimized.

8. ERP Integration

An enterprise resource planning (ERP) system can automate business processes by collecting critical business information from all departments into one central database. By integrating order management modules with the broader ERP system, it becomes easier to monitor and prioritize customer orders as they come in. This leads to faster order processing and an improved customer experience.

9. Implement Barcode Scanning

Barcode scanning can be utilized by pickers to effectively minimize the occurrence of picking errors. This is achieved by immediately alerting the concerned teams whenever an incorrect item is scanned. Such a reliable and precise inventory management method ensures efficient and accurate delivery of products to customers.

How to effectively manage order processing?

Do you grapple with more orders than you can efficiently manage on a simple spreadsheet? Well, you're not alone. You see, Excel spreadsheets can be woefully inefficient when you’re handling a large number of orders daily. That's where specialized software enters the picture, becoming the game-changer and significantly elevating your order processing management.

Let me introduce you to Brahmin Solutions, a cloud-based manufacturing software that packs a powerful punch with its comprehensive features for order processing management. Crafted specifically for the needs of small and medium-sized manufacturers, Brahmin Solutions aims to streamline your operations, enhance efficiency, and grant you a better hold over your order processing workflows. But how does Brahmin Solutions manage to accomplish all this? Let's delve into it.

Central order management

At Brahmin Solutions, we have a platform that makes it easy to manage all the steps involved in processing orders. You can keep track of customer orders, see how far along they are, and even check to see if we have the products in stock. This helps us avoid mistakes and makes sure that your orders are handled quickly and accurately.

Inventory management

With Brahmin Solutions, you can keep track of your inventory and make sure that you have enough products to fulfill your orders. Brahmin Solutions also helps you prioritize urgent orders and ensure they are delivered on time by automatically reallocating the necessary resources.

Brahmin Solutions provides real-time inventory tracking, which means you always know exactly how much stock you have, what materials you need, and how many finished products are available. This helps you avoid running out of stock, use your inventory more efficiently, and ensure your orders are delivered on time.

Production planning

With Brahmin Solutions, you can plan and schedule your manufacturing tasks effortlessly and efficiently. This powerful tool empowers you to prioritize your orders, seamlessly track their progress, and meet customer delivery deadlines without breaking a sweat. Streamlining your workflow can enhance production efficiency, skillfully navigate bottlenecks, and ensure you're deploying your resources effectively. In essence, Brahmin Solutions is your one-stop-shop for getting the job done and done well.

Integration with the industry's best business tools

Brahmin Solutions works with well-known business platforms like Shopify and QuickBooks Online, making it easy for you to sync your orders. By using these integrations, you won't have to enter data anymore manually. This ensures that your financial records are accurate and that your inventory and order information are always up to date, no matter where you sell your products.


Brahmin Solutions has valuable tools to help you understand how well you process orders. You can see reports on past orders, how quickly you make things, and how much stock you have. This can help you find problems, see patterns, and make better choices based on data to improve how you process orders.

If you want to test out Brahmin Solutions, schedule a demo call with a product expert to see how it would help your order management process.

Brahm Meka
Founder & CEO

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