How to Create Order Management Software in 2025

Order management is a crucial aspect of running any business, especially in today’s fast-paced, digitally-driven market. From retail to manufacturing, every organization requires a robust system to manage orders, track inventory, process shipments, and keep customers satisfied. This is where order management software (OMS) comes into play.

Creating an OMS from scratch can seem daunting, but it’s entirely achievable with the right approach. This blog will guide you through the process of developing an order management system, covering everything from core features to technical aspects and best practices.

1. What is Order Management Software?

Order Management Software (OMS) refers to a system used by businesses to streamline the entire order process. From order entry to order fulfillment and after-sales service, OMS is designed to automate and manage orders and their related activities. In essence, it acts as a bridge between customers and the backend systems of a business, such as inventory management, sales, accounting, and shipping.

Key functions of OMS include:

• Order Capture: Collecting orders from various sources (website, mobile app, in-store, etc.).

• Inventory Management: Ensuring products are in stock and tracking the availability of inventory.

• Order Processing: Managing payment, invoicing, and order approval.

• Shipping and Fulfillment: Coordinating logistics for fast and accurate order delivery.

• Customer Service: Addressing issues like returns, exchanges, and inquiries.

2. Why is Order Management Important?

A robust order management system offers several benefits that make it a valuable asset for any business, including:

• Efficiency: Automating processes reduces manual labor and human errors.

• Accuracy: OMS ensures accurate order processing, inventory tracking, and delivery, which leads to better customer satisfaction.

• Real-Time Data: Real-time updates on inventory, sales, and orders help businesses stay agile and informed.

• Scalability: OMS solutions scale with your business, making them suitable for small businesses and large enterprises.

• Customer Experience: A seamless order journey, from order placement to delivery, improves customer satisfaction and retention.

3. Core Features of an Order Management System

To build an effective OMS, several key features are required. Let’s take a closer look at these:

a) Order Entry & Order Capture

• Order capture allows businesses to record orders received from multiple channels such as online stores, physical locations, or customer service representatives. Multi-channel support (e-commerce platforms, marketplaces, physical stores) is critical for managing orders seamlessly.

b) Inventory Management

• Efficient inventory management enables businesses to track stock levels in real-time, update inventory counts after orders are placed, and forecast demand. It should integrate with warehouses to ensure accurate product availability.

c) Order Processing

• The OMS should automatically generate invoices, payment confirmations, and receipts for every order. It should also be capable of managing the order status, like pending, approved, shipped, or delivered.

d) Shipping and Fulfillment

• Integration with shipping carriers (FedEx, UPS, DHL) is essential for seamless delivery tracking. OMS should support real-time shipment tracking, label printing, and the management of different shipping methods.

e) Returns & Refunds Management

• A key feature of OMS is to facilitate easy returns, exchanges, and refunds, allowing businesses to manage the entire reverse logistics process.

f) Customer Support Integration

• OMS should integrate with customer service platforms to manage complaints, queries, and post-sales support effectively.

g) Analytics and Reporting

• A good OMS provides detailed reporting and analytics. This could include insights on sales trends, customer behavior, product performance, and operational bottlenecks.

h) Integration with Accounting and ERP Systems

• Order management should sync with existing accounting and enterprise resource planning (ERP) systems for seamless financial tracking and decision-making.

4. Steps to Create Order Management Software

Now that you understand the core components of an OMS, let’s walk through the essential steps to create one.

Step 1: Identify Business Requirements

The first step in creating an order management system is understanding the business needs and how the OMS will benefit your operations. Key questions to address:

• Who will be using the system? (Sales, customer service, warehouse team, etc.)

• What order types do you need to handle? (Online, phone, in-store)

• What systems need to be integrated? (Payment gateway, ERP, inventory management, etc.)

Step 2: Design the Software Architecture

Once the requirements are clear, focus on the system architecture. This phase involves designing how different components of the OMS will interact with each other. You need to decide whether the OMS will be cloud-based or on-premises, and whether it will be a single monolithic application or a microservices-based solution.

Step 3: Develop the Core Features

Start building the system by developing its core functionalities. Begin with the basics: order capture, inventory management, order processing, and payment integrations. For a better user experience, consider incorporating user-friendly features like automated invoicing, notifications, and a centralized dashboard.

Step 4: Integrate with Third-Party Tools

As you build out your OMS, you will likely need to integrate with third-party tools and services. For example:

• Payment gateways (e.g., Stripe, PayPal)

• Shipping carriers (e.g., UPS, FedEx)

• Customer service tools (e.g., Zendesk, Freshdesk)

• Inventory and warehouse management tools

Step 5: Test the Software

Before deployment, thorough testing is crucial. This includes functional testing, performance testing, integration testing, and user acceptance testing (UAT). Ensure the software can handle high-order volumes and works across different devices and operating systems.

Step 6: Deployment and Maintenance

Once the software is tested, deploy it to your production environment. Continuously monitor the software’s performance and ensure it meets the needs of all stakeholders. Keep improving it by releasing regular updates and new features.

5. Technology Stack for Building OMS

Selecting the right technology stack is crucial for developing a scalable and efficient OMS. Here are some common technologies you could consider:

a) Frontend Development:

• React.js or Angular for a responsive user interface.

• Vue.js is another great option for progressive web applications.

b) Backend Development:

• Node.js with Express for scalable, event-driven backend systems.

• Ruby on Rails is great for rapid development and ease of use.

• Django (Python) offers great support for building secure and scalable systems.

c) Database:

• MySQL or PostgreSQL are reliable relational databases for managing orders, inventory, and customers.

• MongoDB can be considered if you require more flexibility with data structures.

d) API Integrations:

• RESTful APIs or GraphQL can be used to facilitate integration with third-party services (e.g., payment gateways, shipping carriers).

e) Cloud Platforms:

• AWS, Google Cloud, or Microsoft Azure for cloud infrastructure and hosting.

• Use AWS S3 for file storage, and AWS Lambda for serverless processing if needed.

f) Payment Gateway Integration:

• Stripe, PayPal, or Square to securely handle payments.

6. Best Practices for Developing OMS

Creating an efficient and scalable order management system is about more than just writing code. You should keep these best practices in mind:

a) Focus on User Experience (UX)

Ensure the system is intuitive for users. A clean interface, easy navigation, and smooth workflows are essential for operational efficiency.

b) Ensure Scalability

As your business grows, so will the number of orders. Design your OMS to handle increasing data and user traffic without performance issues.

c) Data Security

Protect sensitive customer and business data through encryption, secure payment systems, and compliance with privacy regulations (e.g., GDPR, PCI-DSS).

d) Automation

Automate routine tasks like invoicing, inventory updates, and shipment tracking to save time and reduce human error.

e) Real-Time Updates

Ensure real-time synchronization of inventory, orders, and shipments so customers are always informed.

7. Challenges in Order Management and How to Overcome Them

a) Integration Issues

Integrating various systems (inventory, ERP, CRM, etc.) can be complex. Overcome this by using a well-documented API and choosing compatible systems.

b) Order Accuracy

Manual order processing can lead to errors. Overcome this by automating processes and using robust validation checks.

c) Scalability Issues

As your business grows, your OMS may face scalability challenges. Ensure your software is built with scalable infrastructure and optimized for high-volume operations.

8. Conclusion

Building an Order Management Software is a comprehensive task that requires careful planning, technical expertise, and an understanding of business needs. By focusing on the core features, selecting the right technology stack, and following best practices, you can create an OMS that improves efficiency, enhances customer experience, and scales with your business growth.

An effective OMS can become a competitive advantage, ensuring smooth order fulfillment, accurate inventory management, and enhanced customer satisfaction.