Order Cycle Time: What Is It & How To Improve It

What is order cycle time?

Average delivery time is the length of time it takes to complete an order after it’s placed, excluding the actual shipping period. This is one of the most crucial KPI to track in your order fulfillment process since it helps you measure the effectiveness of your operations.

Ways to improve order cycle time

You may need to improve various elements of your supply chain processes in order to reduce the time it takes for your order cycle.

1. Improve your warehouse flow

Bottlenecks in the warehouse might cause longer order processing times. Is it possible for pickers to locate goods swiftly? Is there sufficient space between the shelving racks so they may move freely? Is your fulfillment bay set up too far from the picking area? All of these barriers might cause the picking and packing process to drag.

You can reduce order cycle time by finding these inefficiencies. Begin by tracking your warehouse KPIs and seeking for ways to enhance them. You may need to optimize your warehouse setup and use warehouse slotting to make the most of available space and enhance picking efficiency.

2. Configure protocols and restrictions

Setting clear standards and processes for your fulfillment team to follow is critical in speeding up the process. This might be as simple as limiting the number of items picked at a time to speed things up and get orders off the shelves into the packing area. You may also establish rules for how and where to return items in order to easily sort or collect them later. Limiting the number of times to reorder inventory is also critical, as it helps to prevent stockouts and backorders, which might cause your order cycle time to lag.

Take a look at how you’re now dealing with late deliveries. In addition to providing real-time ecommerce order monitoring, you should establish policies for what to do in the event of delivery problems. For example, establish a clear procedure for when and how to follow up if an order is stuck at a certain location.

It’s also crucial to be transparent with your consumers about your shipping procedures, such as when the goods are due to arrive.

3. Continue to measure cycle duration

The time it takes for an order to be processed varies from one order to the next, especially when there are changes or delays in the supply chain. An unexpected delivery failure, for example, can result in a significantly longer order cycle time than usual. You may also observe a shorter order cycle time after putting into place an automated system to streamline your warehouse receiving procedure.

Additionally, having to manage a high number of returns may put a strain on your warehouse employees’ concentration since they’re too busy recording and sorting your ecommerce returns. There are several factors external to the company that can influence this order cycle time throughout the supply chain.

There are several things that can influence this figure. It’s critical to keep track of and adjust your order cycle time on a regular basis. You may use this information to see whether you need to evaluate your supply chain operations and make improvements that will speed up the process. It’s also an excellent method to see whether the changes you’ve made have had a positive impact on your cycle time.

4. Fulfillment outsourcing

The easiest approach to reduce the time it takes for your delivery to arrive is to outsource the fulfillment process. Fulfillment outsourcing to a third-party logistics partner can help guarantee that orders are received, picked, packed, and sent out promptly. Look for a 3PL that is technologically enabled and allows you to automate significant parts of the fulfillment process.

The 3PL should have technology that works in tandem with your online store to deliver a seamless shopping experience for your customers. This way, orders are immediately received in their warehouses and fulfillment centers after they’re placed by clients.

By doing so, you’ll automatically process orders, allowing them to quickly move through the fulfillment pipeline and be delivered to your clients in a few hours.. Furthermore, automating the procedure will eliminate the need for manual entry, lowering the chance of mistakes while also improving order accuracy. Learn about 3PL here.