5 min read

What is Order Accuracy and Why is it Essential?

December 15, 2020 by Srishti Arora - 5 min read

Fulfillment is the most crucial step in your eCommerce business. It can become challenging to maintain fulfillment operations’ quality and synchronization.  There are several KPIs you have to track to support the success of your fulfillment operations. Otherwise, you might end up spending extra and not get the desired results. Handling incoming orders is the most critical aspect of your business, and you must track them thoroughly to not miss out on any. 

To ensure the successful processing of every order, you must measure order accuracy. It is one of the most important metrics to track as it is linked directly to the customer experience. To maintain maximum order accuracy, you must ensure proper synchronization between other operations involved in fulfillment like picking, packaging, and shipping.

Let’s look at what order accuracy is and how 3PL fulfillment providers can help you achieve the KPI’s desired results. 

What is Order Accuracy?

Order accuracy refers to the number of orders that you thoroughly fulfilled and shipped to the customer’s doorstep without any error. The errors could include mispacking of an item, wrong order quantity, wear, tear, etc. It is an important metric to track as it directly correlates to the customer experience. It can be difficult as it involves a certain amount of manual intervention. However, you must work on this metric to ensure that your customers have a positive shopping experience with your website.

Order Accuracy Rate Formula

To calculate order accuracy, you must calculate the order accuracy rate using the following formula – 

Order accuracy rate = (Total orders fulfilled accurately / Total orders fulfilled) * 100

So, for example, if you fulfilled a thousand orders from your warehouse, and 100 of them had processing errors, then your order accuracy rate will be – 

Order accuracy rate = (900/1000)*100 = 90%

What is a Good Order Accuracy Rate?

The fulfillment supply chain does not consist of only one operation. There are several systems, mechanisms, and people involved in creating the ideal fulfillment supply chain. Therefore, achieving a 100% order accuracy rate is not always perfect, even though it is the aim. However, you must maintain your accuracy rate closest to a hundred percent.

Almost all day to see brands, marketplace sellers, and social sellers try to keep their order accuracy rate between 96-98%. 

A reasonable order accuracy rate eventually constitutes a positive customer experience and wholesome reviews on social media. Many businesses lose out on customers because they cannot achieve the right order accuracy and have more negative experiences than positive ones.

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Why is Tracking Order Accuracy Vital?

Positive Customer Experience

The order accuracy is directly proportional to a positive customer experience. If you do not deliver products correctly to the customer or they are incorrect in quantity, you will have to bear the brunt of negative feedback and might also lose out on existing customers. Along with that, you will also have to arrange for RTO and pay an extra amount for that. Therefore, tracking order accuracy will help you analyze your fulfillment process and improve your order management. 

Identify Loopholes in Process

Measuring the order accuracy rate will help you identify loopholes in your fulfillment process. Suppose you notice a trend of reduced-order accuracy over a period. In that case, you can quickly identify the loopholes of your supply chain by analyzing each process and understanding where there is a shortage.

Innovate for Improved Order Management

Another advantage of the order accuracy rate is rich insights. The order accuracy rate will help you look for more innovative methods to improve your order management and accuracy. Even if your order accuracy rate is maintained, the data will give you enough insight into improving your customer experience.

Best Practices to Improve Order Accuracy

Audit Operations Regularly

The best way to improve your order accuracy is by auditing your warehouse operations regularly. This will help you analyze every step involved in the fulfillment supply chain, and you will be able to derive results as to why your order accuracy is not improving.

Improve Inventory Management

Inventory management has a direct impact on order management. Try to maintain a real-time inventory management tracking system so that you can analyze incoming orders and correlate them with your inventory. This will help you maintain your stock better and process incoming orders at a much faster pace.

Use the Right Technology

Using an automated system for your order management can help you improve order accuracy. As the system will be synced with your sales channel or marketplace, you will be able to process every incoming order and send it to the right stakeholder in your fulfillment supply chain. If the process is manual, there are chances that you will miss out on a certain number of orders, and that will eventually lead to a decreased order accuracy rate. 

Optimize Picking and Packing

The next most crucial aspect of your fulfillment supply chain is picking and packing. If these are not carried out accurately, there are chances that the order accuracy rate will be affected negatively. Therefore, for picking operations, utilize handheld devices (HHT) to pick products accurately and match them with the order. Have dedicated packing stations and compare your product packaging with SKUs so you can accurately bag every order without errors. 

Outsource to 3PL Providers

The best way to improve your order accuracy rate is by outsourcing your fulfillment operations to 3PL providers. 3PL providers have dedicated resources for every fulfillment operation, and they will be able to process your orders faster, with far better accuracy. 

Shiprocket Fulfilment is one such 3PL fulfillment provider that can help you process orders with 99% accuracy and deliver them 3X faster to customers by providing one day and two-day delivery options. 

Final Thoughts

Improving order accuracy rate is essential for comprehensive order management and fulfillment operations. Calculate the order accuracy rate to ensure seamless fulfillment, timely delivery, and a positive customer experience. 

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December 15, 2020 by Srishti Arora

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