The Order Fulfillment Process: What It Is & 5 Strategies for Improving Sales Order Processing

Ah, order fulfilment. That essential, yet easily overlooked process of receiving, managing and delivering customer orders. While its end goal will never change — ensuring the right order reaches the right customer at the right time — it’s how the fulfillment happens (and how much it now matters to business success) that’s changing drastically.  

Once your average, run-of-the-mill back-office workflow, order fulfillment is now an undeniable value-driver for the entire enterprise. Factors such as shifting customer expectations, supply chain volatility, cashflow prioritization and persisting labor shortages have made fulfillment efficiency a true competitive differentiator for companies eager to sustain trust, improve margins and be quick on their feet as external pressures mount.

Here’s the catch: When manual touch points are baked into the order fulfillment process, any attempts to “meet the moment” are essentially futile — analogous to swimming with ankle weights on. Manual environments are a breeding ground for lost time and lost value, with inaccuracies leading to misplaced orders, fulfillment and payment delays, and order returns. It’s estimated that a single error during the order fulfillment process can cost $30-$75 per incident which, for larger operations, can mean hundreds of thousands of dollars annually — not to mention any reputational damage sustained.  

It's why more companies are being drawn to the potential of AI-driven order management and fulfillment systems. The concept is simple: Secure AI technologies handle repetitive, time-consuming tasks so that errors (a feature, not a bug of manual fulfillment processes) are all but eliminated. Not only is order data validated instantly, key insights and analytics are easy to access and act upon. It all equates to orders processed faster, exceptions managed proactively, and smoother communication between Customer Service, Operations, Supply Chain and even Finance teams. At an even higher level, it nurtures stronger, more resilient order-to-cash cycle — benefitting everything from CX and business perception to the growth goals of the Office of the CFO.

In the following pages, we’ll dig into the nitty-gritty of the order fulfillment process, five take-home strategies for improving order management, and what characteristics and features are absolutely “need-to-haves” in an AI-powered solution. 

The order fulfillment process: A step-by-step breakdown

The order fulfillment definition in business encompasses all the tasks, processes and teams required to get a product from your company’s hands to your customer’s doorstep. When done right, it represents more than a delivered product — it delivers on your company’s promise of reliability, responsiveness and trust.

Step 1: Inventory management

Order fulfillment begins when a business receives inventory from their suppliers. Management of this inventory insists that trends in demand, sales and supplier lead times are closely observed to ensure the right products are available when an order is placed and stockouts, delays and mispicks are avoided at any cost.  

Involves: 

• Checking incoming products to ensure accuracy and quality
• Recording and maintaining up-to-date inventory levels
• Organizing and storing goods in warehouses for quick access 

Step 2: Order receipt, verification & processing 

Consider this the dotting of the “i’s” and crossing of the “t’s” step of the order fulfillment process — it’s everything involved in verifying details and product availability before authorizing payment. In a traditional setting, this can mean multiple data entry requirements and other manual steps across multiple formats (e.g., email, PDF, EDI, or portal). Translation: Delayed response times and inaccuracies are common. 

Involves: 

• Confirming customer details and delivery information
• Assigning inventory according to warehouse availability and proximity
• Directing orders to the appropriate fulfilment channel 

Step 3: Order picking & packing

Exactly what it sounds like: Once the order is authorized, warehouse or fulfillment center employees spring into action to retrieve the items necessary to fulfill a customer’s order. It goes without saying accuracy, visibility and efficiency are vital to this step’s success. 

Involves:

• Staff locating and retrieving ordered items using methods like batch, zone or wave
• Items being packaged based on size and shipping needs to ensure safe delivery
• Optimization practices adopted along the way (e.g., automated packing systems, use of sustainable materials) to improve speed and reduce waste 
   

Step 4: Shipping & delivery management

Shipping is the moment of truth for any order. It’s also where proactive communication becomes critical, speed and precision are a prerequisite, and customers have high levels of transparency from the moment their order is confirmed until it’s delivered. 

Step 5: Post-fulfillment support & feedback

Fulfillment doesn’t end when the product ships. Returns, claims and customer inquiries are all part of the modern fulfillment journey — and when disconnected, they can create toxic levels of frustration for both customers and employees.

Order fulfillment strategies: 5 ways to boost speed, accuracy & outcomes

Even for companies that understand the basics of fulfillment, there’s always room to improve efficiency, accuracy and collaboration. Below are five proven strategies to enhance your order fulfillment process and create a more resilient, customer-centric operation.

Strategy 1 — Embrace AI-driven automation

Many of the drawbacks of a manual order fulfillment system — higher costs, more data discrepancies, slower processing times, etc. — can be avoided with the aid of AI-driven automation solutions. From automated data capture to intelligent routing and exception handling, AI tools dramatically accelerate the pace and precision of order processing. 

But how much ROI can AI’s “work smarter, not harder” promise actually deliver? Esker recently commissioned Forrester Consulting to conduct a Total Economic Impact^™ (TEI) study of its Order Management solution to examine this question. Forrester’s financial analysis was focused on a med device manufacturer, and the quantified benefits were impressive. 

Here is what was achieved over a span of three years with AI-driven order automation: 

• A 62.5% in order entry efficiency (valued at $440,547)

• An 80% reduction in order entry errors (valued at $525,828)

• Elimination of the need to print, scan and archive order-related documents (valued at $220, 243) 

• A total ROI of 274% and net present value (NPV) of $978,669

Strategy 2 — Prioritize proactive communication

Of course, successful order fulfillment doesn’t stop with automation and efficiency gains. Today’s B2B customers now expect the same level of responsiveness and personalization they enjoy in their B2C experiences. 

Using an automated order fulfillment system fulfills this demand. A built-in ecommerce order portal creates a B2C-style shopping journey for every B2B customer. From placing orders to real-time updates on order status and delivery, customers always know what’s happening with their orders. 

Thanks to proactive transparency at every step, businesses can turn fulfillment into an extension of their brand promise — delivering trust alongside every order.

Strategy 3 — Rethinking your team & strategies 

Adopting an AI automation solution is not a replacement for the value that human team members deliver. Instead, it’s an opportunity to reevaluate how they spend their time. By freeing them from data entry and other tedious work, they’re able to be more fulfilled with their jobs, while the business benefits from:

• Fewer order backlogs

• More time for upselling and serving customers 

• Better retention and attraction of top talent 

The Manager of North American Customer Service at H.B. Fuller shared his thoughts on the subject in a recent case study, saying: “Order entry isn’t the majority of what our CSS team does, but it affects their ability to be as proactive as they want to be with our customers. Automation has really helped free them up to do that.”

Strategy 4 — Expand AI automation beyond order management

When the goal is optimizing order fulfillment, most of the attention goes to the orders themselves. It can be easy to forget that other customer-facing processes like customer inquiry management and claims and deductions management can also impact fulfillment — especially if silos and manual bottlenecks are present in these processes as well.  

Be choosy when exploring automation providers. Look for solutions that allow these processes to work in tandem. This enables inquiries to be automatically classified and routed, while disputes can be tracked alongside their related orders. The result is one cohesive system where multiple teams share the same data — creating faster responses and a unified CX.

Strategy 5 — Align order fulfillment with financial performance

While fulfillment has traditionally been an operational concern, modern CFOs recognize its financial significance. The Office of the CFO now plays a broader role as a value architect — one that views fulfillment efficiency as a lever for cashflow, margin protection and growth.

By investing in a robust AI automation suite, CFOs gain real-time insight into cost-to-serve, inventory exposure and revenue timing. It’s not just about shipping faster — it’s about running a smarter, more profitable enterprise.

Why choose Esker as your order fulfillment service?

Esker’s Order Management automation system brings together the latest in AI tech to automate every step of the fulfillment process — from order capture to post-delivery support. With global scalability and ERP-agnostic integration, Esker helps organizations create a customer-centric fulfillment ecosystem that nurtures a better CX, happier employees and stronger bottom-line results.

Key benefits include:

• End-to-end visibility across every order channel
• AI-powered accuracy and analytics
• Seamless ERP integration for improved scalability
• Global compliance for growing enterprises

Watch an on-demand demo of Esker’s Order Management automation software