12 Step Program For Vetting Vendors: Evaluating ERP, OMS, WMS and Other Software Based Solutions For 3PL And eCommerce Fulfillment.
If you are an online retail executive, you are being hounded daily by vendors peddling warehouse management systems (WMS), enterprise resource planning systems (ERPs), order management systems (OMS) and other technology solutions. These programs are built for supporting omni-channel growth and order fulfillment all in the name of reduced costs and enhanced customer experience. 85% of online retailers plan to upgrade their e-commerce technology in the next few years. If you are currently vetting vendors or plan to consider upgrades in the near future, please consider the following to help you make a better decision.
Will it integrate?
- Despite assumptions, you do not have to start from scratch.
- Companies just need to ask if the vendor can easily integrate into existing systems. This is especially true where the firm has already invested heavily in content management, product information and order management systems.
Is this sustainable?
- Think 2–3 years in advance. Any further out and you’re just guessing.
- Does it allow for updates and general evolutionary direction of the industry and can it adapt to changes in customer expectations.
- Look for software bundles and application synergies that are based on your typical buyer/customer profiles.
- Are you considering industry changes? The Internet of Things is coming… When we have appliances that order food for us and toothbrushes connected to the cloud, will your software stand the test of time?
If sustainability is not taken into consideration, waiting too long, changing midstream or picking the wrong partner could cripple your business.
What are the “all-in” costs?
You don’t know what you’re paying for until you line up the alternative and compare all the costs over the period of useful life. The only way to do this is to get ALL of the costs and put together an “apples to apples” comparison.
- Consider contractors/staff required to maintain
- Software upgrades and maintenance
- Security (data storage and back-up costs)
- Extensions and other features requiring additional costs
- Future upgrades and scale
- Does vendor require additional contingency fee(s) based on volume or sales revenue?
Don’t get analysis paralysis (S*** or get off the…)
- Vendor selection shouldn’t take more than 2 months, but many companies overcomplicate the process and take 5–6 times longer than what is necessary.
- Understand the implementation requirements and plan accordingly: 47% of respondents said that implementation took “somewhat longer” than expected, 33% said it took “a great deal longer”, and only 16% said it was implemented on time.
- You might consider having one of your existing service providers or internal resources help you develop an RFP to manage and expedite the selection process.
Think about customization
- Identify what level of customization will be required upfront. Too much customization can be costly and may also prohibit future upgrades. If that is the case, you may want to rethink what you actually need or explore other alternatives.
- Before developing in-house, sign up for a trial of vendor software to get the basics of what a platform should provide. Many vendors will allow you to run a free trial which will save you time and effort “re-inventing the wheel.”
○ Here are some top rated software companies that offer free trials — Now Commerce, CentralBOS and Cin7
Find a system that is user/employee friendly
- Data pulls should be easy to process and understand.
- Usability will be key for internal data analysis and flow of data across the organization.
Talk to other customers (get references)
- How does the vendor measure up?
- Check your references
- No different than an online review
- Is it cloud based? Cloud server space is growing in retail sector faster than any other industry
- Must be responsive: Real-time data communication and order processing is quickly becoming a standard feature
- Single Platform: A single platform makes it easier to integrate with multiple systems
- Should handle peak seasonal volumes
- Intelligent order routing: Effective routing based on most efficient routes and fulfillment source; Supports optimal customer experience.
Like anything that’s worth doing, it’s worth doing right. A little upfront homework on vendors will payoff and save a ton of hassle in the long run. I expect the items listed in this post could apply to outsourcing decisions for any type of vendor (i.e. 3PL, real estate provider, material handling, etc.).
See more at www.logisticsbroker.blog
Resources for this post:
- Saddle Creek Logistics — Whitepapers https://www.sclogistics.com/whitepapers/ > https://www.sclogistics.com/wp-content/uploads/2017/02/OMS-Whitepaper.pdf OMS: Key to the Optimal Omnichannel Customer Experience
- EcommerceB2B — http://ecommerceandb2b.com/order-management-and-b2b-ecommerce/
- Vetting a Vendor — Kate Evans: Internet Retailer Periodical, May 2017 pg 20–24