E-commerce retailers rely on order accuracy as one of the primary metrics that show the level of trust between a brand and its customers. Improving the accuracy of the order can help provide many huge benefits, including reducing costs and enhancing customer satisfaction, which in return means increasing the profits that the organization achieves. In this article, we will cover all the details about the accuracy of the request, how you interpret it in your business, and the importance of following up on its indicators.
What is order accuracy?
We can define order accuracy as the percentage of orders that are fulfilled and delivered to customers without any errors.
The higher of this rate, the better indicator of the success of your brand and services in fulfilling customer requests.
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How to calculate order accuracy
As for the method used in calculating order accuracy, there is a mathematical formula that is relied upon to determine that percentage.
Which helps you to know the level of your brand and business, and it can help you to improve your mistakes and boost your business.
The following is the mathematical formula used to calculate order accuracy, which you can rely on to easily calculate that percentage in your business:
- Order accuracy rate = (total orders fulfilled accurately ÷ total orders fulfilled)*100
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What bad order accuracy can do to a business
It is of great importance to maintain a good rate of order accuracy, which will greatly enhance customer satisfaction.
Good order accuracy helps you retain your customers in the long term, which means continuous sales and profit flow.
Especially since if customers receive their order incorrectly, this will lead to an increase in customer complaints and a bad impression on them.
This is because of the bad experience that happened to them, which will make those customers go to another store that competes with you.
The following are the most important points that show you the result of bad order accuracy on your business:
- Creating negative customer perceptions.
- Increase costs to your company.
- Direction of customers to deal with your competitors’ merchants.
- Decreased profits for your company.
- Loss of a large percentage of customers who deal with you.
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Track these fulfillment KPIs to improve order accuracy
There are a set of KPIs that can help you improve your order accuracy. The following are the most important of these indicators:
Average order value
What is meant by it is the average of what each customer spends in your online store on orders that he buys from you during a certain period of time.
It is an important performance measure that contributes to improving order accuracy, as it shows the company whether it needs marketing campaigns or not.
This indicator also helps companies predict the products customers need, thus giving the company an opportunity to provide them at the right time.
One of the key performance indicators that helps you improve order accuracy is by which you can determine the rate at which your inventory is being used.
The higher this indicator, the more this indicates that there is a strong demand for the products it offers, and vice versa.
Average shipping time
One of the most important performance indicators affecting the improvement of order accuracy is the average time required to complete a delivery within a given period.
This indicator helps you effectively track the effectiveness of your supply chain, and know whether you are facing delivery problems or not.
It is the percentage of requests that customers returned after the purchase process, which is most likely due to the system’s inaccuracy in fulfilling those requests from the beginning.
This indicator helps improve returns management to increase customer satisfaction and retain customers instead of losing them altogether.
Order picking accuracy
Another important indicator that also affects the accuracy of orders is the number of times your shipments contain the correct goods and materials.
It indicates how accurate the selection of applications is, and knowledge of this indicator will help you in:
- Handling errors in applications.
- Making appropriate decisions to enhance the accuracy of selection.