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CHAPTER 4

Order
Management
Once the sellers have been onboarded and
the catalogue is LIVE, the sellers are ready Expected key takeaways
for receiving orders from the buyers - the from this section:
catalogue will be visible for relevant Order Management Dashboard and Key features
searches of buyers on Buyer Network and reports of the dashboard
Participants.
The sellers must ensure that once an order Understanding and SOP for managing Seller
cancellations of orders
is placed by the buyer for their product
catalogue, they are able to dispatch the
material in a timely manner to the buyer. The Understanding and Guidelines for Managing
Returns in order management
entire process of managing the operations
once an order is successfully placed by a
customer till it gets delivered and then if Understand which metrics to track for measuring
and controlling order management performance
returned comes under Order Management.
In this section, we will cover best practices
for managing orders.
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Order visibility to
sellers:
Order management
dashboard
Once the order is placed on a seller’s product, the
order should be visible to the seller so that he can
start the process of making the order ready for
dispatch and hand over to the Logistics Seller
NP/Off Network Logistics for delivery to the buyer.
For this to happen, the Seller Network Participant
must provide a dashboard to the sellers where they
can monitor live orders, mark them ready for
dispatch and track the order status post-dispatch.
[Visit Governance and Policies on ONDC Website:
General obligation in Ch2 (Business Rules): 2.4.1]
There are two ways for Seller Network
Participants to get the dashboard (Order
Management system) created:
Develop this through internal tech team
In case the internal tech team has capacity
or capability gaps for this, outsource to third
party technical service providers and get it
developed
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Order management system Raising and tracking issues related to orders: The
capabilities guidelines seller must be able to raise tickets against an order
from the dashboard itself to the Seller NP.
[Visit Governance and Policies on ONDC Website:
Ch 2 (Business Rules): 2.4.1, 2.4.3, 2.4.9, 2.4.13] Updating Selling price and inventory quantity against
each product live. The inventory needs to be
The Order management system provided by Seller updated.
Network Participant To the sellers should have following
functionalities for the seller:
Visibility of new incoming orders being placed on seller Recommended report in
inventory. Notification mechanism to the Sellers on the
Order Dashboard/App for new incoming orders.
seller panel
Fulfillment reports
Update of status of the order as it flows from receipt
of order to the final delivery of order. Order report: Detailed report of all orders and
fulfillment status
Processing and packing orders and movement of
stages in the system– downloading labels and Pickup Report: All orders which must be picked up/
invoices - For dispatch of a product, the seller should reattempted for pickup
be able to print an invoice for the order to be placed Returns: Details of all orders which are returned and
inside the package and print the sticker with the tracking reverse shipment status
shipping label with address details of the customer.
The order dashboard should provide the functionality Invoice & payment reports
to generate and print these documents for each order. Commission Invoices: All monthly commission
Tracking In-transit and delivered orders: post shipment of invoices can be tracked here
order and before delivery the updated status of the order Commission invoice report with transactions:
should be visible to the seller. To check transactions level details of all
Tracking In return and returned orders: Once the order gets orders linked to a commission invoice
returned the seller should be able to track which orders are Payment reports with UTR details at a
getting returned to the seller. 41
transaction ID level
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Pending, Canceled & Returned Order Tax reports Inventory health report
report: Details of all orders which are
Summary information to Report with Current inventory
not yet payable due to order
help file GSTR return in system, Rate of
cancellation, payment window not
consumption, Days left,
closed, or return of order
Inventory health status

Managing seller cancellation

Seller cancellations:
Let us see what could be the different reasons for order cancellations by a Seller and what are the Standard
Operating Procedures to minimize different kinds of seller cancellation situations.

Reason for Seller Description of Issue Guidance

Cancellation

The seller may not have the inventory when the SOP issue at seller end. Seller training
Inventory not order comes. There can be multiple reasons for this required: help define SOP, refer
including - inventory not updated, End of Life SOP 1 below
available product, inventory sold out in other channels.

In this scenario, although the seller has updated Tech Issue. Seller NP to check why
the correct inventory, if the inventory does not the inventory is not reducing on
Tech Issue reduce on order placement from the dashboard sales
the seller will continue to receive orders even if
the actual physical inventory becomes zero.
In such a scenario the seller might have to
cancel the order.

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Reason for Seller Description of Issue Guidance

Cancellation

There is a minimum margin which a seller expects to SOP issue at seller end. Seller training
Mistakes in earn from the sale of a product. If there is a pricing required: help define SOP, refer SOP 2
mistake which reduces the margin and makes it less
Pricing the than the minimum expected margin the seller will not
product be willing to fulfill the order and may cancel it.

Some sellers may not respond/stop responding Seller Intent issue.

Seller Issue when an order is placed resulting in Seller NP to (Warning > Improvement Period
cancel the order. > Deactivation)

Seller NP to ensure that the seller can download Inventory status reports with relevant fields which are
provided in the Seller Panel & seller is trained to create & read the reports, guidelines for creating inventory
report and how sellers can use it.

Suggested SOP 1 a: Managing stock outs (non-immediate dispatch categories like apparel): at regular
frequency sellers download the Inventory health report from the panel. All columns can be prefilled by Seller
Network Participant and made available.

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Current Last n Expected Inventory

Product Product Category Inventory days/hours for 10 days Gap Inventory
ID Name (A) daily avg (C = B*10) Status
orders (B) (D= A-C)

ABC1 XYZ F&B Green

ABC2 PQR Grocery Red
ABC3 RST Apparel Yellow

Seller NP should provide the inventory report from the seller panel.

Steps to create report:

Step 1: Step 2:
Column A: Download product level Column B: In this column, you can see the
inventory from the seller panel. Check the “daily average sales” for each of the
number in column A against each product seller’s stocked items. This column is
ID and correct it with actual physical created by calculating daily average sales
inventory available in the same column. for the previous 10 days.
Seller to update correct inventory through
the seller panel.

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Step 3: Step 5:
Column C: In the column for ‘expected For products which are in red take one
orders for 10 days’, the Seller should be of the below decisions:
able to see the total orders expected. The
Seller must adjust for any expected spike Order more at the right time, factoring in
or dip in sales. The reasons for spike or the time from ordering to actual delivery to
dip can be because of the upcoming sale the seller.
season or end of festive sales, a decrease
or increase in price, or a seasonal change. Decide to take the sale loss.
The seller must add an adjusted number
in this column.

Step 4: Step 6:
Column D: The inventory Gap column For products in yellow evaluate risk at
shows the inventory shortfall or excess product level and take call to
expected in the next 10 days. If this is in the
Red zone, it indicates that there is an issue. Order more basis expected variability in
When there is an excess of inventory, it falls sale of the product
in the green zone and it indicates that your
inventory status is good. If it falls under the Do not order now
yellow zone it means your inventory is only
slightly above the expected sales. You have If followed at regular intervals this will
just enough. Also, make sure that the line ensure there are minimal to no Seller
between the Yellow and Red zone is defined cancellations due to unplanned stock outs.
at the seller business/category level.
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Suggested SOP 1 b: Managing stock outs Suggested SOP 2 : Managing pricing

(immediate dispatch categories like F&B)
If the correct prices are not updated by the
There may not be an option to update the number seller for a product one of the two scenarios
of units of the food items available since the seller may happen:
does immediate dispatch of products and it is difficult
to map raw material of food with no. of units (Eg. If the prices are uncompetitive, then seller might
batter/flour with a number of dosa). These categories not get potential orders for those products
should have an option of marking products Available
vs Not Available for sale in the seller panel. It is If the prices are competitive, however do not meet
critical that the information flows in a timely manner the desired margin expectation, then the seller may
to the person managing the inventory panel as soon receive orders which the seller may not be able to
as a product's raw material is finished. (E.g. from the fulfill resulting in seller cancellations. An extreme
kitchen for the F&B category)
case may be that if the product is a high selling
product and prices are incorrectly configured ,
the seller may get a high volume of orders for the
It is important for the person managing
the panel to follow below steps: product all of which may get canceled due to low
Before the store opening hour, coordinate with the team margins.
and mark products available or not available for sale for
The below steps are suggested for sellers to execute
the day.
at regular intervals to ensure such scenarios are
As soon as information is received of a SKU not available eliminated /minimized.
during the open hours, mark the product Not Available
immediately.
In the worst case if the information was not received on time
and order couldn’t be fulfilled, mark the product not available
on the basis of this information. Capture the misses, identify
patterns at product level and define stricter processes to
ensure misses do not happen in future.
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Seller to download below price mapping report (Columns A to D) from seller panel
and seller to create the columns E to G. against this report.
Product ID Product Category Current Selling Buying Current Expected
(A) Name (B) (C) Selling Price of other price (F) margin Profit
Price (D) sellers (E) (D-F/D) (G) Margin (H)

Seller to follow the below steps for correcting/changing prices:

Step 1 Step 2 Step 3 Step 4
Add the latest Calculate and update Seller to map the Seller to map the
buying price current margin as per the expected margin in Selling price from other
(Column F) formulae in column G column H sellers to arrive at price
competitiveness
Step 5 Step 6 Step 7
Compare Current Basis step 4 & 5 Seller to update new pricing to the
margin with vs Changes the price as seller panel against each product
Expected margin per business priorities where changes are done

Metric Why to Track Calculation Relevance for

Seller cancellation rate Helps identify the failure rate No of orders canceled by Seller, Seller NP
due to seller inefficiency seller/ Total orders confirmed
by seller
Percentage of sellers with a Measures seller quality (Seller with >x% SC/Total sellers Seller NP
high order cancellation rate confirming orders) X 100

Please note Refund in seller cancellation instances is governed by E-commerce rules 4(10), 6(3), 7(4), 8(10)
Also price manipulation not allowed under Consumer Protection (E-commerce) Rules, 2020 4(11); and [Visit Governance and
Policies on ONDC Website: Ch 2 (Business Rules): 2.4.13(h)]

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Managing customer
cancellations
Customer cancellations are important to investigate as these are orders where the buying intent of
the customer was very high before the buyer canceled the order. Some of the reasons might be
uncontrollable from the seller or Seller Network Participant perspective but few actions can be
taken to control and manage cancellations.

Reason for customer Description of issue Guidance

cancellation

The buyer is committed to a timeline for delivery Work with the packaging &
when the buyer places an order. If the order is dispatch team to improve dispatch
Delay in not dispatched or does not get delivered within timelines.
shipment the timelines, the buyer may choose to cancel Check if inventory check SOP 1 is
the order. implemented and being followed.

After placing the order, the buyer may browse Check if selling prices are too high
Buyer finds the through other Seller Network Participant listings and change basis margins
same product at or may explore the price of the same product in available, if required source at
a cheaper price offline markets. If a buyer finds a lower price in lower cost.
elsewhere. any of these places, he may choose to cancel
the current order and buy from these alternate
sources at a lower price.

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Reason for customer Description of issue Guidance

cancellation

Timeline The buyer may not have checked the ETA of Check if ‘Time for Dispatch’
communicated in delivery before placing the order, after placing communicated for dispatch is higher than
order confirmation the order if the buyer checks the ETA of actual and correct if required.
was high delivery and finds it to be high from his/her If the actual time for dispatch is high,
expectations, the buyer may choose to cancel work on dispatch operations to reduce
timelines and decrease time for dispatch.
the order. If the Logistics Seller NP/Off Network
Logistics has higher time for delivery,
change partner for the category if it’s a
repeated issue.

Buyer changed The buyer may change mind about making the Uncontrollable
his/her mind purchase itself at this point.

Buyer ordered by The customer may have ordered by mistake and Uncontrollable
mistake may not have requirements for the product.

Buyer will reorder The buyer after placing the order sees some Uncontrollable
with promotion/offer running for the product which
promo-code/different he/she missed applying while placing the order.
address later The buyer wants to place the order with
promotion applied and hence cancels the current
order.

While following the guidelines mentioned in this section, the seller NP can ensure that their sellers are
performing, it is important to measure the performance with the help of metrics. In this section we will
look at the metrics which can be used to measure and monitor the performance at seller and seller NP
level and take corrective measures if the metrics worsen.
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Metric Why to Crack Calculation Relevance for

No of orders
Seller Helps identify canceled by
the failure rate seller/ Total Seller, Seller
cancellation due to seller NP
rate orders confirmed
inefficiency by seller

% of sellers
(Seller with <x%
with <x% SC/Total sellers
Measures
seller seller quality confirming Seller NP
cancellation orders))(100
(SC)

(No of Orders
Customer Helps track the canceled by
customers/ Total Seller, Seller
cancellation cancellations by
NP
rate customers orders confirmed)
X100

Please note cancellation, return, refund policy has to be declared

upfront.Consumer Protection (Ecommerce) Rules, 2020 5(3)(c), 6(5)(g),
7(1)(a)
Also [Visit Governance and Policies on ONDC Website:Ch 2
(Business Rules): 2.3.1, 2.3.10, 2.3.12, 2.4.1, 2.4.2, 2.4.8, 2.4.16] 50
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Managing
returns
Once the products are shipped by the seller, one Process to be set for returns
of the below scenarios can happen:
When the return happens, the Logistics Seller
The product is delivered to the buyer, buyer is NP/Off Network Logistics will pick the product and
satisfied with the product, and accepts the deliver it back to the seller. The seller must then
product with which the return window closes set up the process to carry out below activities for
a smooth return handling process:
When the product is delivered to the buyer the
buyer wants to return it (can be due to multiple
reasons such as buyer changed their mind,
products do not match what was shown on
catalogue, product is damaged), these returns Process 1:
are called Customer Returns
It is possible that when the product is returned to
the seller, it is in damaged condition, either from
The product is not delivered to the buyer as the the customer or while in forward or reverse
buyer refused to accept the order, Logistics Seller transit. At the time of dispatch, the seller must
NP/Off Network Logistics was not able to ensure that he/she has sufficient proof to
reach/connect with buyer, buyer address was establish dispatch of the correct product and
incorrect/incomplete. These returns are called quality of packaging (through videos & images).
Return before delivery (RBD). This will help establish seller claims and act as
proof in case a product is returned damaged.
This section looks at the returns taking place in the last
two points above, and the guidelines around how to
manage these returns.
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Process 2 (a): Process 2 (b):

If a return order is received by the seller and there In case there is no damage to the outer packaging, but
is visible damage to the outer packaging later the seller realizes there is damage to the actual
indicating mishandling and possible damage to product/brand box, the seller needs to raise it in
the product, the same should be mentioned on defined timelines with the Seller NP. Claims raised
the Logistics Proof of Delivery document (POD). beyond a defined timeline may not be accepted. Seller
NP to set timelines with respective sellers. Seller NP
needs to raise the issue to the Logistics Seller NP/Off
Network Logistics as per Logistics Seller NP/Off
Network Logistics’s timelines.

Customer returns after delivery

This section zooms into the reasons for customer returns and suggests guidelines for managing such
returns. It is important to investigate and reduce customer returns as these result in zero sales while
incurring cost of operations, logistics cost, and risk of in-transit damages.

Customer Return Guidelines for Improvement

Description of Issue
after delivery reasons
Incorrect product In this scenario, due to a miss on Create a checklist for packaging associates before orders
getting delivered the seller’s end, an incorrect are dispatched. Put it up near the packaging area
product got delivered
Product getting In this scenario the product Check % of products damaged. If the % is on the higher
Damaged received by the seller is damaged. side, it can be due to packaging quality issues – check
Either the product dispatched by the packaging guidelines section of he handbook
the seller was damaged or it got If packaging is good, check logistics level damages and
damaged in transit shift to Logistics Seller NP/Off Network Logistics where
damages are less
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Customer Return
Description of Issue Guidelines for Improvement
after delivery reasons

Delivered product not The products delivered are different from the product Check the catalogue data and information provided.
as per product display seller has displayed on the product display page - this If there is a gap, correct the product display page
page can be in terms of looks\ or product features in line with the actual product

Product not working Product received by customers is not functioning For branded products: Ensure the brand guidelines for
defective products are mentioned with the brand helpline
number for the issue
For private label sourced by supplier directly from
manufacturer: If it is a one-off manufacturing defect, no
process level action is required. If the issue frequency is
high, check with the manufacturer to improve quality and
discontinue selling till improvement is made

Incomplete order The customer had ordered multiple products Create a checklist for packaging associates and before the
delivered or multiple units of the same products but product is dispatched. Put it up near the packaging area
received For the specific case, discuss with the customer if he/she
only a part of the complete order agrees for the remaining order to be dispatched separately
to close the issue.

Customer mind Customers no longer feel the need for the No action required if return % is low If the returns are very
changed delivered product high, sellers may take a call to
make the product only prepaid
Orders will decrease but the returns will also go down
Sellers can also make the product non-returnable

Fit/Size issue This would be the case for the fashion Accept returns
category where the delivered product size Allow only exchange
does not fit the customer
Check PDP to ensure the size chart is updated and
correct for the product.

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There can be two scenarios for customer returns defined at business rule level:
Products which are non-returnable: Customer can raise issue through the Buyer App especially for cases of
damaged, incorrect, defective products received by customers.
Products which are returnable: All scenarios of customer return reasons are possible. Customers can directly
raise return requests through the Buyer App
The following circumstances outlined below create an obligation to offer returns or refunds under e-commerce rules
in India:
● Incorrect package got delivered
● Product received by buyer is damaged
● Product delivered is different from product display in catalogue
● Defective product received by buyer
● Only a part of the complete order is delivered
● Customer no longer needs a product
● It is a size or a fit issue

Managing Return Before Delivery (RTB)

RBD are orders returned to the seller without delivery to the buyer. It is important to keep a check on RBD numbers and percentage
as it is a loss of sale, and the seller/seller NP must bear the cost of operations and logistics.
This section investigates reasons and suggests guidelines for what to check in each case and how to control it.

Reasons for RBD Reason Description Guidelines for Improvement

Delivery attempts If the order delivery was attempted late from the ETA Delay in shipment - Follow SOP 1
delayed from ETA communicated to the buyer at the time of placing order, Delay post shipment - Check logistic level metric on post
the buyer may choose not to accept the order order delivery timelines. Solve with Logistics Seller NP/Off
Network Logistics or shift to a Logistics Seller NP/Off
Network Logistics with better ETA of delivery
Customer address The delivery partner is not able to reach the customer Check at Buyer NP code level if the issue is coming from a
incorrect/incomplete due to incorrect address/unreachable or incorrect particular buyer NP due to UI/UX issues of the address page
contact number to solve for the long term
Include it in the checklist at dispatch. Connect with
customers to get a complete address before dispatch

Customer asking for Customer asked for opening product at the time of Check for business rules of Logistics Seller NP/Off Network
open delivery - logistics delivery which the Logistics Seller NP/Off Network Logistics
denied Logistics denied and hence Declare in the product information if open delivery is not 54
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Reasons for RBD Reason Description Guidelines for Improvement

Customer does not Customer selected a cash on delivery (COD) payment No action, cost of doing business
have cash/payment mode but when the delivery agent reached the buyer
capacity at delivery the buyer did not have cash or the card for making
payment at delivery

Customer denied Customer denied as he/she changed his mind. For non-returnable products, seller
- intent issue may choose not to refund complete or
not related to partial value
operations gap

While following the guidelines mentioned in this section the seller NP can ensure that their sellers are performing,
it is important to measure the performance with the help of metrics.In this section, we will look at the metrics which
can be used to measure and monitor the performance at seller and seller NP level and take corrective measures if
the metrics worsen.
Let's explore the metrics that can be used to evaluate and track your performance, as well as that of your sellers,
along with corrective measures for the same.

Metric Why to Track Calculation Relevance for

RBD% Measures % of orders which were not delivered No action, cost of doing business Seller, Seller NP
to the customer post shipment and return
initiated to seller

Avg order to Helps identify delays due to inefficiencies in For non-returnable products, seller may Seller, Seller NP
ready to ship packaging timelines and gaps in availability of choose not to refund complete or partial
time products post confirmation which results in value
increase in RBDat the end

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Metric Why to Track Calculation Relevance for

Order to Helps measure the failure due to delay in No of orders packed post ETA/Total no of Seller, Seller NP
ready to ship packaging timelines against the expected orders packed
time breach % timeline. This results in an increase in RBD

Avg ready Helps identify time taken for pickup by Logistics Take average time for all orders between Seller, Seller NP
to ship to Seller NP/Off Network Logistics ready to ship stage and shipped stage
post packaging and made ready to ship.
dispatch time Delays result in an increase in RBD
Orders ready Helps identify rate of breach of timelines by (No of orders picked after Logistics Seller Seller, Seller NP
to ship to Logistics Seller NP/Off Network Logistics in NP/Off Network Logistics
dispatch ETA pickups. These breaches result in expected ETA/Total orders shipped)
increase in RBD X 100
breach %

Please note: Cancellation, return, refund policy has to be declared upfront. Ecommerce Rules 5(3)(c),
6(5)(g), 7(1)(a) ALSO Visit Governance and Policies on ONDC Website: Ch 2 (Business Rules): 2.3.1,
2.3.10, 2.3.12, 2.4.1, 2.4.2, 2.4.8, 2.4.16

Important Do’s

Identifying key reports to maintain and Track delivery times and actual delivery date
update on regular intervals against promised time

Keeping cancellations at minimum - Track Keep track of customer returns and fix
inventory, pricing, catalogue correctness recurrent issues

Keep track of ratings and fix controllable issues

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