Welcome to the fast-paced world of ecommerce, where every moment counts and even a small delay can turn a loyal customer away. Successful ecommerce businesses constantly optimize their operations for maximum efficiency. This blog post focuses on transfer orders—an essential yet often overlooked component of commerce operations. If done wrong, transfer orders can cripple a business. We’ll delve into the benefits of transfer order automation and guide you on how to implement it in your order operations.
Benefits of Transfer Order Automation
A transfer order refers to the process of moving physical goods from one location to another. For commerce businesses these locations are most often warehouses or retail stores. Transfer orders begin by sending a shipping request to a location—usually a warehouse—and end when the destination location receives the shipment. Automating the end-to-end transfer order process has significant benefits for ecommerce businesses including:
- Reduced costs
- Increased efficiency
- Reduction in manual errors
- Real-time inventory visibility
- Higher customer satisfaction
Increased Efficiency
Automating transfer orders increases efficiency by minimizing the time it takes to process and execute orders. It eliminates manual time spent on paperwork, communication, data entry between systems, and error correction. Automated systems handle transfer orders faster and more accurately, enabling quicker dispatch and receipt of goods. This speed is crucial for businesses dealing with high transaction volume or needing to respond rapidly to market demands.
Reduction in Manual Errors
Manual processes are often prone to errors, such as data entry mistakes. Automation greatly reduces these errors by ensuring accurate data capture, validation checks, workflows, and system synchronization. Automated systems work 24/7 to keep information accurate before, during, and after processing any transfer order. This accuracy is vital for maintaining reliable inventory levels and order tracking, which in turn, supports better decision-making based on accurate data.
Real-Time Inventory Visibility
Transfer order automation ensures real-time visibility into inventory levels, essential for omnichannel inventory management. Automated systems update inventory counts as soon as an item is allocated for transfer, making it easier to track current, in transit, and expected stock levels across multiple locations. This real-time inventory data helps prevent stockouts and overselling, ensuring optimized inventory levels to meet demand without tying up unnecessary capital in excess stock.
Improved Customer Satisfaction
Quick and accurate handling of transfer orders enhances customer satisfaction. Customers receiving their orders on time build trust in your brand. Improved inventory management helps businesses meet evolving customer demands without delays, further enhancing the customer experience and potentially increasing loyalty and repeat business.
How to Automate Transfer Orders
Whether you’re a small retailer or a large conglomerate, understanding and applying transfer order automation is a crucial component of efficient logistics and inventory management. Implementing transfer order automation requires careful planning and the right tools. Here, we’ll explore how ecommerce businesses can leverage technology to automate their transfer order processes.
What Effective Transfer Order Handling Looks Like
Effective transfer order handling involves quick processing times, high accuracy, and minimal staff intervention. Orders are processed through preset workflows, including automatic inventory checks, order routing decisions, and prioritization rules. The primary goal is to ensure seamless movement from request to fulfillment.
Transfer Orders and ERP
Enterprise Resource Planning (ERP) systems are central to the management of transfer orders, serving as the source of truth for:
- Inventory
- Product catalog
- Orders
- Accounting
- Financials
ERPs can initiate transfer orders manually or automatically based on inventory levels, historical data, and numerous other criteria. Synchronizing ERPs with fulfillment channels throughout the transfer order process is crucial to avoid major issues and ensuring any received inventory matches the transfer order specifications. If your inventory system of record is unaware of the status of your transfer order, or cannot account for in-transit inventory, you’ve got a big problem.
Transfer Orders and Warehouse Management System (WMS)
A Warehouse Management System (WMS) efficiently manages stock within warehouse facilities. These systems are the backbone of inventory control and fulfillment. Beyond handling picking, packing, and shipping, WMSs optimize storage and track product locations from arrival to dispatch.
For transfer orders, a WMS can play two roles:
- sending a transfer order
- receiving a transfer order
On the sending side, it receives a transfer order from an ERP and handles picking, packing, and shipping. On the receiving side, it manages stocking, counting inventory, and updating the ERP or inventory management system with accurate counts.
Integrating ERP with WMS
Integrating ERP and WMS applications brings financial and logistical operations together, creating a unified system with automatic updates. This integration reduces redundancies and errors, promoting streamlined operation. Do your diligence when selecting a solution to connect an ERP with one or more WMSs, as not all solutions are the same. Simple app store plug-ins might be free, but are extremely limited on the data that can be moved and offer no customization potential. iPaaS tools are infinitely customizable, but take a long time to implement and modify because they lack any commerce domain knowledge or features. Ecommerce order operations solutions like Pipe17 provide the best of both worlds with fast implementation and configuration, native ecommerce best practice workflows, and no-code customizations to match any unique ERP setups.
Syncing Transfer Order Arrivals and Receipts
To maintain inventory accuracy, it’s essential to sync the arrival of goods with their receipt in the inventory system. This process decreases inventory discrepancies and helps maintain up-to-date records, captured in the ERP or inventory system of record. Arrivals and receipts are key steps in the transfer order process that need to be captured, tracked, synched, and adjusted across the WMS and ERP.
Updating Transfer Orders Inventory Location to In Transit
Updating the inventory status to ‘In Transit’ once a transfer order is executed is critical. This status informs all departments involved that the goods are no longer in the sending warehouse but have not yet to reach their destination. Automatically moving inventory into and out of the in transit status eliminates confusion and lost inventory.
Continue Selling In Transit Inventory
An advanced feature of transfer order automation is the ability to continue selling goods in transit. By accurately tracking transfer order products and their expected delivery times, businesses can promise these goods to customers without waiting for the physical stock to be received. This significantly reduces lead times and improves sales velocity and profit margins.
Conclusion
Automating transfer order processes can improve efficiency, accuracy, and customer satisfaction while strengthening the ability to scale and meet market demands. Successful transfer order automation requires seamless multi-channel integration, especially between ERPs and fulfillment channels like warehouse management systems and 3PLs. The best transfer order automation tools go beyond integration to synchronize arrivals, receipts, shipments, and inventory data in real-time and can send notifications if something goes wrong. As the ecommerce landscape evolves, automating processes like transfer orders ensures resilient and efficient operations. If you’re looking for a solution to automate transfer orders or streamline other order operations processes, schedule a time to talk with Pipe17 today.
