How To Integrate Distributed Order Management System with Shopify Plus

Overview of Distributed Order Management (DOM)

DOM, or Distributed Order Management, is an omnichannel order fulfillment optimization solution that solves the ultimate problem of how we can maximize our end customer promise in the supply chain network. Build out your DOM to ensure customers receive the right products from their correct sources at the right time. This could ensure profitability and cost-effectiveness and maintain service-level requirements.

DOM uses MIP (Mixed Integer Programming) to create models that predict the best way to optimize batches and individual orders. This allows retailers to set rules that effectively balance competing order fulfillment needs. In a modern supply network, products can be fulfilled through many channels, and organizations need to respond rapidly to changes in orders, supplier availability as well as demand spikes. From the business perspective, orders need to be filled as they come in and from the most convenient source, which could maximize profitability (perhaps fulfilling an order from a far distance away is very expensive). DOM accounts for shipping distances to fulfillment sources and destinations, costs or optimization objectives, as well as rules of order placement restrictions. Multiple profiles can be defined in DOM, which allows businesses to have different optimization strategies depending on the type of business or consumer segment.

Importance of Integrating DOM for Retailers with Shopify Plus

The average retail store in the US operates with an inventory accuracy rate of just 63%

Connecting a DOM system to Shopify Plus is an essential step for any business that wants to streamline eCommerce order fulfillment and have customers enjoy a top-notch experience. A DOM system increases the effectiveness and efficiency of order orchestration by connecting multiple sales channels with different sources of inventory so orders can be validated, processed, and packed properly for packing and shipping.

DOM integrated with Shopify Plus provides real-time stock visibility across all locations so brands can avoid overstocking or stockout and simplifies the entire order management process. The integration also offers omnichannel strategies, enabling retailers to source orders from the best location – whether that’s a warehouse, store or 3PL/drop-shipping. It allows business to save time and money, meet customer expectations in a faster evolving e-commerce market-and ultimately stay competitive.

Understanding Distributed Order Management Systems

What is a Distributed Order Management System?

Distributed order management helps meet customer orders with rule-based workflows, enhances retail fulfillment, and fulfills demand at a maximum level at the lowest cost possible.

Key Features of a DOM System

The key features of Distributed Order Management (DOM) systems are:

Inventory Visibility

This feature allows users to pull stock levels from all sales channels and stores into a centralized view in real time. The most important part is to make the best and most analytics-driven decisions, such as where they can place an inventory and from where orders will be served.

It makes the handling of inventory and warehouse efficient. It also helps accurate calculation of safety stock levels, which eventually keeps the business costs at a minimum.

Order Management

The purpose of this feature is to provide all businesses the ability to manage their orders from multiple channels, including e-commerce sites, stores, and the marketplace, in a centralized way in real time. Proper order management will result in happy customers, higher net revenues, and better customer retention.

Fulfillment Optimization

The DOM systems leverage algorithms to decide the optimal and least expensive way on how orders are delivered. That optimization includes levels of inventory, shipping prices and delivery time that allows organizations to reduce costs as well as speed up delivery times.

Customer Experience

This ensures that the organizations can always offer with best possible service levels and keeps their customers well informed upfront about product availability so they are able to handle orders appropriately without customer dissatisfactions due to delayed or canceled order delivery. This will help you to remain in front of all those returning customers and get them referring sales for your business.

Integration

DOM systems are integrated with other systems like warehouse management system (WMS), transportation management system (TMS) and customer relationship manager (CRM), which creates an end-to-end user experience solution for supply chain management and sales activities.

Decision Making

Data driven insights and recommendations provided by DOM systems about where organizations should keep inventory, and how to use the order fulfilment. This is where improved workflows can lead to better operational efficiencies and as a result, higher sales with increased revenue. This combination will increase operational metrics as well as business-level metrics.

Scalability

DOM systems are designed to scale, providing organizations with a tool that can manage their sales & fulfillment operations as they change and grow.

Data-Driven Insights

DOM systems deliver data-oriented insights and recommendations to the organization so that it can better decide how best to allocate inventory, fulfill orders, etc. It enables you to manage your operating expenses, which in turn makes sure that unnecessary pressure is not put on the working capital.

Increased Sales and Revenue

With effective tools to optimize sales and fulfillment operations, DOM systems are designed with the goal of increasing sales availability at scale. This will, in turn, result in an increase in the net profit ratio simultaneously with your financial KPIs and revenue.

Order Management Benefits

Here are the advantages of a B2B Distributed Order Management System (DOMS):

• Automate Complex Orders: Automates order tracking, inventory management, and logistics, reducing manual labor and speeding up fulfillment.
• Real-time Visibility: Provides real-time insights into inventory, order status, and shipping, enabling quick, informed decisions.
• Order Customization: Supports personalized fulfillment options like BOPIS (Buy Online, Pick Up In-Store) to enhance customer satisfaction.
• Flexibility: Easily scales with business growth, handling more channels, locations, and inventory without needing replacement.
• Advanced Insights: Collects and analyzes data to offer valuable business insights for better decision-making.
• Store Fulfillment: Automates and tracks inventory for efficient multi-store order fulfillment, reducing stockouts.
• Integrated Data: Integrates with ERP and warehouse systems for a complete real-time business view.
• Micro-fulfillment: Enables micro-fulfillment centers closer to customers, speeding up delivery and reducing costs.
• Multichannel Management: Manages sales and orders across multiple channels from a single interface.
• Reduce Stockouts: Tracks inventory and automates reorders, minimizing stockouts and lost sales.
• Fast-track Time to Market: Speeds up order fulfillment, getting products to market faster and maintaining competitiveness.
• Exceptional Customer Service: Enhances customer service by providing real-time order and inventory visibility, improving response times.

Why Integrate a DOM System with Shopify Plus?

Why Retailers Need Distributed Order Management? The question is obvious. For brands that want to scale sustainably and ensure customer expectations are met, integrating with a Distributed Order Management (DOM) system is a crucial step. For example, a DOM system optimizes inventory and order fulfillment to reduce cancellations of orders while ensuring the right delivery. Additionally, it offers a single view of inventory in real-time across all sales channels, ensuring better stock control and fulfillment accuracy. Furthermore, customized workflows to manage orders from various channels in one DOM system and eliminate split shipments also save costs. When businesses are expanding, by adding inventory or fulfillment locations and global sales processes, a DOM system can provide the required scalability needed to grow without the added cost of switching eCommerce platforms.

Pre-Integration Considerations

Before integrating a Distributed Order Management (DOM) system with Shopify Plus, there are several key considerations to ensure a seamless and efficient operation:

1. API Limitations and the Leaky Bucket Algorithm

• Shopify uses the leaky bucket algorithm to manage API requests, limiting the flow of requests from third-party apps to ensure optimal performance.
• Overloading the API can result in errors, so it’s essential to manage data downloads intelligently to avoid disruptions caused by throttling.

2. Downloading and Syncing Products

• Shopify limits the number of product styles that can be downloaded in a single API call, which can pose challenges if the response file size exceeds Shopify’s limits.
• It’s recommended to download up to 100 products in each API call to ensure a more reliable and comprehensive process.

3. Syncing Inventory to Shopify

• Accurate inventory management is crucial for preventing order cancellations and maximizing inventory returns.
• Regular synchronization between the OMS and Shopify, including real-time updates, is necessary to maintain inventory accuracy, especially for retailers with a large number of products and variants.

4. Downloading Orders from Shopify

• OMS systems need to efficiently route orders by downloading them from Shopify, but challenges such as exceeding response file size limits or missing orders due to timing gaps can occur.
• Implementing buffer times between jobs and handling orders with missing or invalid shipping addresses or products are essential strategies for ensuring all orders are captured and processed correctly.

Steps to Integrate Distributed OMS with Shopify Plus

With Shopify eCommerce operations growing rapidly, retail brands that have or plan on expanding their brick-and-mortar locations alongside online sales should prioritize Distributed Order Management System (DOMS) implementation. When integrated with Shopify, DOM can holistically enhance the overall customer experience.

Here are five key steps to integrate a Distributed Order Management (DOM) System with Shopify Plus:

1. Initial Data Setup:

Export all Shopify product data to the OMS to get a comprehensive product list. Ensure that product, order, and inventory information is synced across both platforms.

2. Synchronize Products:

Periodically sync product information in the OMS from Shopify, keeping key details like SKU, images, and descriptions up to date. Updates are scheduled every 6 hours to maintain the most current data.

3. Order Management:

Automatically sync all new and updated orders to the order master service across Shopify at regular intervals (every 15–30 minutes). Only receive orders that have been paid, with order status levels (including cancellations) accurately reflected between the application and ERP.

4. Inventory Management:

Use the OMS as your single real-time inventory source. Update stock across Shopify through batch processes, ensuring safety stock levels, fulfillment locations, and order queues are maintained.

5. Batch Processing for Data Sync:

To sync the bulk of data from the OMS to Shopify, utilize job processes rather than storing everything in real time. This approach helps optimize your use of Shopify API call limits and ensures that product, order, and inventory data is consistently updated.

Best Practices for a Seamless Integration

Here are some tips to ensure that your Distributed Order Management (DOM) system integrates well with Shopify Plus:

• Define What You Need: Begin by mapping out your fulfillment objectives and identifying weak points in your existing processes. This will provide clarity on what the right DOM solution should be, ensuring it aligns with your business requirements and scale-up strategies.
• Clean and Prepare Your Data: Ensure that your inventory and order data are fully cleaned and prepared before integrating the DOM or OMS system. This step is crucial for performance and helps avoid data inconsistencies during integration.
• Change Management and User Training: Understand that a DOM system may alter the workflows of your fulfillment teams. Provide comprehensive training to your teams so they are well-prepared to leverage the new system you’ve invested in.
• Gradual Rollout: Consider implementing the DOM system in stages, starting with a small level of products or a few locations. This approach allows you to identify and address any issues early on, minimizing disruption to your operations.
• Monitor and Optimize: After integration, continuously monitor the performance of your system and make necessary adjustments to enhance its functionality. Regularly evaluate your fulfillment processes to identify bottlenecks and make fact-based decisions that create a seamless experience for your customers.

Common Challenges and How to Overcome Them

• Customer Experience: Shopify is a great platform, but has its limitations around creating custom experiences across both physical and digital channels for your brand. To solve this, use a DOM system that gives you real-time visibility offer unified customer experience.
• No Real-Time Inventory Sync and Backorder Management: One of the most reported demerits of Shopify is its lack of adequate backorder management, which can lead to unsatisfied customers due to canceled orders. Pulling all channels into a single view of the inventory provides an up-to-date, accurate picture of every sale.
• Return Management Challenges: Shopify’s basic return process can lead to delays in refunds and increased manual work for your team. A DOM system automates returns and refunds, streamlining the process and ensuring faster customer satisfaction and inventory replenishment.
• Inefficient Fulfillment: Shopify does not optimize fulfillment based on proximity to the nearest warehouse, which can increase delivery costs and shipping times. A DOM system routes orders to the closest fulfillment location, reducing costs and speeding up delivery.
• Manual Fulfillment: As order volumes grow, manual fulfillment becomes slow and error-prone. A DOM system automates order fulfillment, reducing mistakes and improving efficiency, which supports smoother scaling of your operations.

Examples of Successful DOM Integration with Shopify Plus

Retail Success with Distributed Order Management

OMS enables retailers to deliver seamless customer experiences, including real-time inventory visibility, same-day and next-day delivery options, and an effective Buy Online Pickup In-Store (BOPIS) experience. Zumiez, for example, effectively uses “Store Mode” on its category pages to highlight in-store pickup options, which helps increase conversions. Similarly, Allbirds leverages OMS integration to offer different delivery options based on ZIP codes, enhancing customer convenience. There are many more such success stories for Retail Order Management Solutions.

Order Management Software/Tools and APIs For Shopify

Order Management Integration via Shopify APIs

Since online merchants can easily integrate a distributed order management system with their Shopify Plus platform, there are many available pre-built APIs which they can integrate.

• Fulfillment Orders API: With this function, developers can help ensure accuracy in order fulfillment by retrieving the status of all types and stages of orders, including those in progress. Open, canceled, or incomplete transactions.
• Orders API (Shopify store; create/retrieve carts, purchase orders and refund purchases): This is useful to ensure that the order data in distributed order management system and Shopify are same.
• Inventory API – The inventory API is optimized for interacting with the system in a way that allows you to control your available stock and its locations, which should be an important item during fulfillment based on multiple warehouses or fulfilment centers.
• Shipping API – It lets you view shipping profiles, rates, and services, which enables accurate cost-based decisions in the distributed order management system.
• Refunds API: These APIs manage refund processing and provide a shared view of order statuses between the two systems, as well as interchanging financial data.

Shopify Plus Integration Tools

• Flxpoint: Retail Operations platform that enables merchants to e-commerce integration and sync OMSs, IMSs as well 3PL with Shopify Plus store. They come with order syncing, inventory control and analysis features.
• Celigo (Shopify Plus, iPaaS): Celigo is an Integration Platform as a Service that provides bi-directional data sync between Shopify Puls and other core SaaS Applications or on-premise enterprise applications (OMS, ERP & CRM).
• Zapier: A no-code integration platform, Zapier makes it easy for buyers to set up connections between Shopify Plus and their order management system (OMS), accounting software, and more through pre-built “zaps” or custom in-house developments.

Conclusion

Shopify Plus, integrated with a Distributed Order Management (DOM) system, offers a powerful solution for businesses with complex fulfillment needs. A well-implemented DOM can significantly enhance operational efficiency, improve customer satisfaction, and drive rapid growth.

With the guidelines mentioned in the blog and proper DOM system in place, you can make sure that your Shopify Plus store goes achieve success in the long run.

FAQs

Ready to take the next step? Reach out to the DOM integration experts at Ignitiv for a talk on how we can help improve and strengthen your business.