What is Order Fulfilment?

Order fulfilment is the entire system of receiving orders, processing them and delivering the goods to the consumers. Order fulfilment has witnessed a boom courtesy the growth of ecommerce, but it was a widespread practice in traditional retail. There are differences though as ecommerce order fulfilment is more dynamic and challenging. Order fulfilment is often outsourced by a seller or company to a third party that specialises in the various steps. There can be any number of steps in order fulfilment depending on the needs of the seller and the type of goods being handled.

In its simplest form, order fulfilment will include receiving orders wherein receipts of purchases will be forwarded to the third party by the seller on behalf of the buyer. The orders will be processed. The inventory may be moved to the order fulfilment centre after the purchase has been completed or the stock may already be in place. Order fulfilment centres or providers usually attend to warehousing, inventory management, order processing and dispatch, tracing and delivery. The delivery may be at the doorstep or at a point as determined by the seller and as agreed upon by the buyer. Order fulfilment centres are responsible for the entire processing of orders, right from receiving the proof or purchase to delivery of goods. The provider may also be responsible for returns management depending on the scope of service it has been hired for by the seller.

Warehousing and inventory management are two key components of order fulfilment. Receiving and processing orders are rather simple tasks if the stocks are maintained well and if the logistics is efficient. Order fulfilment services will be largely influenced by the need for storage, the kind of stock maintenance warranted in each scenario, the nature of orders, the type of goods being dispatched and delivered, the returns policies and the scope for disputes. Many order fulfilment service agreements include provisions for addressing grievances of consumers. Many ecommerce companies are only confined to operating the website and selling the goods to customers, either businesses or consumers, at times both. Everything else after the sale up to the delivery and usually returns and follow-ups is catered to by order fulfilment providers. Order fulfilment is a quintessential component of ecommerce. It would be fair to infer that ecommerce as we understand it and know it today will be non-existent if it were not for the order fulfilment centres and their multipurpose role.