Order Routing Overview

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1. Strategic Overview

Developer Reference

See the Order Routing API documentation for programmatic access

Concept Definition: Order Routing is the dynamic decision-making logic that determines the optimal fulfillment location(s) for a customer order based on a configured set of business rules and real-time inventory and location data. Business Context: Kibo Commerce’s Order Routing serves as the central orchestration engine within the unified commerce platform, translating overall fulfillment strategy into action. It is essential for maximizing inventory utilization across all network nodes—warehouses, stores, and suppliers—to meet customer expectations and operational goals. Value Drivers:

• Optimized Fulfillment Cost: By factoring in criteria like geographic proximity or inventory carrying costs, routing logic minimizes shipping expenses and reduces the need for costly markdowns by prioritizing the movement of slower-moving inventory.
• Enhanced Customer Experience: Intelligent location assignment allows the platform to offer faster delivery options and a higher probability of fulfillment, significantly improving the ability to meet delivery promises.
• Maximized Inventory Utilization: The system leverages a single view of inventory across the entire enterprise, allowing retailers to treat store stock as sellable online inventory, effectively increasing the available pool of products and reducing stockouts.

Scope Statement: This guide provides a complete conceptual framework for Order Routing, detailing its core components, configuration attributes, and functional capabilities. It covers how routes, scenarios, filters, and after actions are used to define the routing hierarchy and logic. It explicitly excludes the technical details of API implementation, specific configuration steps in the Admin UI, and deep dives into the separate concepts of Fulfillment, Reverse Logistics, Order Routing Extensibility configuration.

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2. Core Concepts Explained

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What is Order Routing?

Order Routing is a powerful service within the Kibo Commerce platform that designs and executes order-specific assignment and visibility logic. It operates on a hierarchical structure of Routes, Scenarios, Filters, and After Actions to create a Routing Strategy. When a new order or shipment is created, Order Routing evaluates this strategy against the line items, customer address, and fulfillment location data to recommend or assign the single best location or set of locations to fulfill the order.

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Why does Order Routing matter?

Order Routing provides the sophisticated control required for enterprise-level omnichannel operations.

• Operational Benefits: It eliminates manual assignment, reducing errors and processing time. It enables advanced strategies like Ship-from-Store (SFS) and Delivery from Store, which are important for leveraging store assets as mini-distribution centers and increasing the speed of delivery to nearby customers.
• Financial Benefits: By dynamically choosing the lowest-cost or fastest-moving inventory location, it directly impacts the profitability of each order. It helps reduce markdowns by prioritizing locations with slower-moving inventory, ensuring products are sold at full price.
• Customer Experience Benefits: The system can be invoked early in the buying process, such as during the cart or checkout steps, to perform a preliminary routing check. This early invocation determines in real-time if a specific delivery or pickup method is viable based on the customer’s location and product availability. This prevents customers from completing an order only to be notified later of a stock issue, thereby improving conversion rates by maintaining high customer confidence in fulfillment promises.

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3. Functional Components & Configuration Deep Dive

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Component Architecture: The Routing Hierarchy

The Order Routing system is organized into a hierarchy that translates high-level strategy into executable logic:

1. Routes (or Strategies): The highest level, representing the overall fulfillment approach for a general order type (e.g., all standard home delivery orders). A route contains one or more Scenarios.
2. Scenarios: A specific set of locations, a set of Filters, and a set of After Actions. A single order or shipment is evaluated against scenarios in a defined sequence until a successful location assignment is made or the route is exhausted.
3. Locations: The individual physical or virtual entities (e.g., warehouse, store, dropshipper) that hold inventory and can fulfill orders. Locations are added directly to a Scenario.
4. Filters: Logic defined within a Scenario to exclude locations that do not meet certain criteria, narrowing the pool of candidates.
5. After Actions: Logic that executes after Order Routing has attempted to assign an order within a Scenario. Common after actions include failing over to the next Scenario or splitting the order to fulfill different items from different locations or putting the items in customer care / cancellation.

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Configuration-Level Deep Dive

Order Routing logic supports two primary fulfillment types and their consolidation requirements:

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Fulfillment Types Supported in Order Routing

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Consolidation and Transfer Routes

Consolidation is the process of attempting to source all items in an order from a minimal number of locations to reduce shipping costs and customer shipments. When consolidation requires moving inventory between locations, Transfer Routes are utilized. A Transfer Route defines the logic for moving inventory from a source location to a receiving location. Order Routing is invoked for the transfer to determine the best location to supply the missing inventory. Transfer Routes are supported for:

• Direct Ship with Transfers (Consolidation): If an order is intended for Direct Ship but requires items from multiple locations, the platform can be configured to attempt a consolidation transfer. A selected receiving location (e.g., a primary Distribution Center) that has most of the items can request the remaining items from other source locations via a transfer route. The order is then fully consolidated at the receiving location before shipping to the customer.
• Delivery with Transfers (Consolidation): Similar to Direct Ship, an order flagged for local delivery can have its inventory consolidated at the designated delivery-originating location via a transfer route before the final-mile delivery is executed.
• BOPIS with Transfers: Buy Online, Pickup In Store (BOPIS) itself never uses Order Routing for the initial assignment, as the customer has explicitly chosen the pickup location. However, if BOPIS is configured to support transfers and if the chosen pickup location does not have the inventory, Order Routing is invoked for a Transfer Route to assign the optimal source location to send the missing item(s) to the designated BOPIS store. The final customer fulfillment is still BOPIS, but the underlying inventory movement uses Order Routing’s transfer logic.

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4. Functional Components & Configuration Deep Dive (Continued)

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Filters: Defining Assignment Logic

Filters are conditional logic rules that restrict the pool of potential fulfillment locations within a Scenario. They ensure that an order is only assigned to locations that meet the required operational, inventory, or order-specific criteria. Filters can be built using both first-class fields (out-of-the-box attributes) and Extensible Attributes (custom attributes). The Extensible Order Routing capability allows the business to select which custom product, location, customer, order, and inventory attributes are available to be used in filter logic, providing maximum flexibility in defining unique routing rules.

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5. Key Capabilities and Business Applications

The true value of Order Routing is demonstrated in its ability to execute complex, real-world fulfillment strategies.

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Capability: Geographic Proximity Routing for Cost Optimization

Functional Explanation: This capability uses the latitude and longitude of the customer’s shipping address and all candidate fulfillment locations to calculate the distance. This distance can then be used in the routing logic, either as a primary sorting mechanism to prioritize the closest location or as a filter to exclude locations beyond a cost-effective radius. This directly impacts shipping costs and delivery speed. Business Application Example: Industry: Direct-to-Consumer (DTC) Brand Scenario: A high-growth DTC apparel brand is fulfilling orders from three regional distribution centers (DCs) and 50 retail stores. To manage rising parcel carrier costs, the operations team needs to ensure standard ground orders are fulfilled by the closest inventory source that can complete the entire shipment. Order Routing is configured such that the order is assigned to the closest location to the customer that can source all items. This results in faster delivery times and a significant qualitative reduction in average shipping expense per order.

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Capability: Excess Inventory Prioritization

Functional Explanation: This capability enables locations to be prioritized based on Excess Inventory. Routing based on Excess Inventory can be used as a sorting rule within a scenario to actively select the location that holds the highest excess stock for the item, accelerating inventory turnover. Business Application Example: Industry: Fashion & Apparel Retailer (Omnichannel, seasonal) Scenario: A major fashion retailer carries seasonal goods that must be cleared to make space for new collections. To minimize end-of-season markdowns, the Inventory Manager creates a specific routing scenario for current season items. The scenario applies a sorting logic that prioritizes locations with the highest Inventory Excess for the specific item. When a customer places an order for a sweater, the system assigns it to the store or DC that has the highest Excess Inventory.. This proactively handles inventory overstock, resulting in fewer required markdowns and improved gross margin realization.

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Capability: Daily Order Assignment Thresholds

Functional Explanation: This allows the business to configure a maximum number of orders that a specific fulfillment location can receive or process in a defined period (e.g., daily). This serves as a capacity constraint filter to prevent overloading a location, especially for stores where associates have other primary duties. Business Application Example: Industry: Enterprise Electronics Retailer (High-value items, complex fulfillment) Scenario: A national electronics chain uses its retail stores to fulfill a high volume of accessory orders (ship-from-store). Store managers report that exceeding 75 orders per day negatively impacts their in-store customer service. Once a store’s assignment count for the day reaches this limit, Order Routing automatically excludes it from the assignment pool for new orders until the next day. This prevents burnout of store staff and results in better in-store service and a more consistent, reliable fulfillment process for online customers.

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Capability: Dynamic Routing Based on Custom Attributes

Functional Explanation: This capability leverages Extensible Order Routing to enable dynamic assignment logic based on custom (non-standard) data points associated with the Item, Location, Order, Customer, or Inventory. By enabling a custom attribute (like a Boolean, Text, or Integer, List field) in the respective platform component, the attribute becomes available for use in routing Filters. This allows the business to build sophisticated, highly granular routing rules that reflect unique operational requirements or specialized fulfillment programs not covered by standard, out-of-the-box fields. Business Application Example:

• Industry: B2B Industrial Distributor (Complex pricing, client accounts)
• Scenario (Customer Attribute): An industrial equipment distributor has high-value B2B customers who have negotiated specific Service Level Agreements (SLAs) for fast fulfillment. These ‘Preferred Accounts’ are flagged with a custom Customer Attribute called “ServiceTier: Gold.” The Order Routing strategy includes a dedicated Gold Tier Scenario with a customer filter for this attribute. This scenario only includes locations that are guaranteed to ship within four hours of order placement. If a Gold Tier customer places an order, the system first attempts to route to these premium locations. This ensures the business meets its contractual SLA obligations, resulting in fewer penalties and a stronger long-term customer relationship.
• Industry: Marketplace Operator (Multi-vendor management)
• Scenario (Item and Location Attributes): A marketplace operator needs to route bulky, high-freight-cost items only to specific fulfillment partners that have the logistical capacity to handle them. The operator adds a custom Item Attribute called “OversizedShippingFlag” (Boolean) to all applicable products. Simultaneously, they add a custom Location Attribute called “FreightCertified” (Boolean) to the certified fulfillment partner warehouses. The routing scenario uses a Filter: Item.OversizedShippingFlag = True AND Location.FreightCertified = True. This precisely links the specialized product requirement to the specialized location capacity, resulting in lower freight exceptions and reliable fulfillment for large items.

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6. Platform Integration Map

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Upstream Dependencies

• Inventory Management: Requires accurate, real-time inventory visibility across all potential fulfillment locations (warehouses, stores, suppliers) to function. Outdated or inaccurate stock levels will lead to fulfillment failures.
• Location/Facility Management: Requires all physical locations to be properly set up, enabled for fulfillment, and have their operational attributes (e.g., coordinates, transfer-enabled status) correctly configured in the platform.
• Product Catalog: Optional - required if using Item extensible attributes. Requires all items to have necessary attributes (both first-class and extensible) populated, as these are used by Item-based filters in the routing logic.

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Downstream Impacts

• Fulfillment/Order Management System (OMS): Order Routing directly dictates the destination of the shipment, initiating the fulfillment workflow (e.g., picking, packing, shipping) at the assigned location.
• Shipping & Logistics: The assigned location determines the origin of the shipment, which impacts the available carrier options, shipping rates, and expected delivery time provided to the customer.
• Customer Service: The assignment decision drives all post-purchase inquiries, as Customer Service Representatives (CSRs) need to know the fulfilling location to assist with status updates, changes, or cancellations.

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Synergistic Features

• Reverse Logistics: When Reverse Logistics is enabled in Kibo Commerce, Order Routing can support returns processing through return routes and disposition routes. These specialized routing configurations determine where returned items should be sent for inspection, restocking, or disposal based on return reason / product condition. Return routes handle the initial inbound movement of customer returns to the appropriate receiving location. Disposition routes determine the subsequent routing of returns based on their final disposition (restock, refurbish, liquidate, discard). This capability extends Order Routing’s intelligence to the post-purchase phase, enabling businesses to automate returns handling and optimize reverse supply chain costs.
• Inventory Segmentation: This complementary feature allows businesses to ring-fence specific inventory for certain channels or orders. Order Routing logic can target or exclude these segments, ensuring, for example, that stock reserved for in-store purchases is not routed to an online order.

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7. Related Conceptual Guides

For foundational knowledge, refer to:

• Inventory: This guide is a prerequisite to understanding Order Routing, as routing rules are entirely dependent on having an accurate, unified view of inventory across the enterprise.

To understand downstream impacts, refer to:

• Fulfillment: This guide details the actual operational processes that are executed at the fulfillment location once Order Routing has successfully assigned the shipment.

For complementary strategies, refer to:

• Extensible Order Routing: This guide explains how to define and manage the custom product, location, order, customer, and inventory data points that are utilized by Order Routing’s advanced filtering capabilities to achieve greater business specificity.