Order Splitting

Order splitting occurs when a single customer order is fulfilled in multiple separate shipments. This can happen because items are in different warehouse locations, have different availability dates, or for fulfillment cost optimization.

Why Orders Are Split

Inventory Reasons

Optimization Reasons

Types of Order Splits

Location-Based Split

Order: Items A, B, C

Item A: Warehouse CA
Items B, C: Warehouse TX

Result:
- Shipment 1: Item A (from CA)
- Shipment 2: Items B, C (from TX)

Availability-Based Split

Order: 5 units Widget

Available: 3 units
On backorder: 2 units

Result:
- Shipment 1: 3 units (ships now)
- Shipment 2: 2 units (ships when available)

Supplier-Based Split

Order: Brand A product + Brand B product

Brand A: Ships from our warehouse
Brand B: Drop-shipped from vendor

Result:
- Shipment 1: Brand A (our warehouse)
- Shipment 2: Brand B (drop-ship)

Order Splitting Impact

Customer Experience

Business Impact

Order Splitting Policies

Automatic vs. Manual

Automatic split:
- System decides based on rules
- Inventory-driven
- Optimization algorithms

Manual split:
- Human decision
- Exception handling
- Customer request

Split Decision Criteria

Customer Communication

Clear Messaging

Order Confirmation:
"Your order #12345 will ship in 2 packages:

Package 1 (Ships tomorrow):
- Blue Widget × 2
- Tracking: Provided when shipped

Package 2 (Ships Feb 15):
- Red Gadget × 1 (backordered)
- Tracking: Provided when shipped"

Order Tracking

• Single order view showing all shipments
• Individual tracking per package
• Unified status updates
• Clear delivery expectations

Split Order Fulfillment

Process Flow

Order received
      ↓
System checks inventory locations
      ↓
Determines optimal split
      ↓
Creates fulfillment orders
      ↓
Each location picks/packs/ships
      ↓
Customer receives multiple packages

Coordination Challenges

• Multiple locations involved
• Timing synchronization
• Communication to customer
• Tracking consolidation

Minimizing Splits

Strategies

1. Inventory positioning - Stock where demand is
2. Consolidation - Wait and ship together
3. Alternative sourcing - Transfer inventory first
4. Customer choice - Let them decide

When to Avoid Splitting

• Low-value orders (shipping cost > benefit)
• Customer requests consolidated
• Fragile items (multiple handlings)
• Gift orders (prefer single package)

Split Shipping Economics

Cost Analysis

Order: 2 items, different warehouses

Option A: Split shipment
- Shipment 1: $8
- Shipment 2: $7
- Total: $15

Option B: Transfer inventory, ship together
- Transfer cost: $4
- Single shipment: $10
- Total: $14

Option C: Customer picks up 1 item
- Customer drives further
- Bad experience

Decision Factors

• Shipping cost per location
• Inventory transfer cost
• Customer expectation
• Delivery speed importance

Technology for Split Orders

System Capabilities

• Multi-location inventory visibility
• Split order logic
• Unified customer communication
• Combined order tracking view

OMS Functionality

Order splitting rules:
1. Check all locations for items
2. Calculate shipping from each
3. Determine optimal fulfillment
4. Create split orders if beneficial
5. Maintain unified customer view

Best Practices

For Customers

1. Explain splits upfront
2. Provide combined order view
3. Send notifications per shipment
4. Make tracking easy
5. Handle inquiries gracefully

For Operations

1. Set clear splitting rules
2. Optimize inventory placement
3. Balance speed vs. cost
4. Monitor split rates
5. Gather customer feedback