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Home » Glossary » Order Processing

Order Processing

Derek Gallimore

Last updated: April 5, 2024 5 min read
Definition

What is order processing?

Order processing is the sequence of steps that gathers a customer’s data, encodes their order, and passes it on to another department for fulfillment.

Depending on the industry, fulfillment can take the form of shipping or bookings and rentals.

Order processing is a crucial aspect of business processes that involves detailed steps from the moment a customer places an order to the final delivery of the product or service.

Further, depending on the scale of the business, business owners can choose to leverage technology to speed up order processing and use data science techniques to understand their customer base better and predict inventory and sales trends.

Some business owners, however, prefer to use more traditional pen and paper processes for their lower upfront and maintenance costs.

Role of an order processor

An order processor is in charge of managing a company’s database platform, responding to customers’ questions and concerns, processing orders, handling payments, and confirming order information before shipment.

In addition, order processors plan the shortest route in Google Maps, ensuring timely delivery and avoiding order delays and customer complaints.

Order processors work closely with delivery drivers and dispatchers to ensure accurate and timely delivery confirmation.

They require computer abilities and strong communication skills, particularly when dealing with consumer criticism of services.

Order processors are integral to the smooth operation of businesses that rely on efficient order processing and inventory management.

What is order processing
What is order processing?

Why is order processing important?

Order processing is crucial since it leads to more revenue and better customer service. Manual order processing wastes time and money, whereas an efficient order processing system saves time and lowers overheads in the business process.

As soon as you use an order processing system in your business, you’ll be able to scale your business without becoming overwhelmed with customer messaging regarding inquiries and complaints.

By understanding the key steps involved in order processing, businesses can streamline operations, meet customer expectations, and stay ahead of the competition.

From receiving customer orders to delivering the final product, the order processing workflow involves multiple stages that require careful coordination and timely execution.

Choosing the right order processing software

When choosing order processing software for your business, it is important to consider your specific needs and requirements. Here are some factors to take into account:

  • Features. Make sure the software has the features you need, such as order entry, inventory management, and reporting tools.
  • Integration. Ensure that the software can integrate with your existing systems and tools.
  • Scalability. Choose a software solution that can grow with your business.
  • Cost. Consider the software’s cost and weigh it against the potential savings and efficiencies it can provide.

Significance of order processing systems

Investing in an order processing system for your business can have a multitude of benefits. These systems can help reduce order processing times, improve order accuracy, and enhance customer satisfaction.

By automating the order processing process, you can also free up valuable time for your employees to focus on other important tasks.

Order processing systems are vital for a warehouse management system as they optimize the flow of orders through the entire fulfillment process.

Outsourcing order fulfillment process

Due to advances in telecommunications technology and cloud-based storage, the order fulfillment process can now be digitized for a considerable price.

Finding the skills to use the data from digital order processing is a much more cost-effective alternative for small business owners because of outsourcing.

Thanks to advances in telecommunications technology and cloud-based storage, order processing can be digitized much more cheaply.

And thanks to outsourcing, finding the expertise to leverage the data from digital order processing is a much more economical option for small business owners.

Efficient order processing is crucial for maintaining customer satisfaction and driving revenue growth.

Outsource Accelerator provides you with access to great order processing specialists. You can outsource from the Philippines starting from $6 per hour, saving up to 70% on staffing costs.

We make it easier for clients to learn about and engage with back-office outsourcing.

Outsource order processing
Outsource order processing

Why your business should outsource order processing

Outsourcing order processing can be an effective way for businesses to streamline their operations and focus on core activities. The pressure of managing and maintaining an order processing and fulfillment system is eliminated when you outsource order processing.

Many companies are turning to outsourcing as a cost-effective solution to manage order processing needs effectively.

Here are some reasons why businesses need to outsource order processing services:

Help make data-driven decisions 

When data is distributed across various platforms, it’s difficult to keep track of it. Order processing makes it simpler to assess available data and make data-driven choices by allowing users to access all sales order data in one location.

Since you can see the entire process, order processing makes it easier to recognize real-time issues. Making data-driven decisions can help companies save money for the business.

Further, fixing even the smallest inefficiency may drive supply chain efficiencies and have a big impact on the bottom line when order volume is high.

Saves time and effort

When you started as an entrepreneur, every hour you spend analyzing fulfillment difficulties is an hour you might be spending on more strategic tasks such as product development or brand growth.

It’s a good start to do everything yourself, but order processing will be a big help to better understand your customer and increase sales.

One advantage of outsourcing order processing is that you won’t have to appoint, train, or deploy customer service and fulfillment employees because the offshore model will take care of everything.

Increase customer satisfaction

Outsourcing order processing services can greatly improve customer satisfaction by ensuring orders are processed accurately and efficiently, resulting in timely delivery of products.

This can lead to happier customers and repeat business, as delays or errors in processing can negatively impact your business reputation.

By streamlining the order fulfillment process, businesses can improve customer satisfaction and loyalty.

Cost savings

Another benefit of outsourcing order processing is cost savings. In-house processing is expensive, requiring investment in technology, staffing, and infrastructure. Outsourcing lets you pay for needed services without overhead costs.

Outsourcing helps avoid errors and delays from in-house processing. Third-party providers process orders quickly and accurately, reducing risks and costs.

Access to specialized expertise

Outsourcing order processing services enables businesses to access specialized professionals who streamline workflows, implement best practices, and enhance efficiency.

Leveraging their skills leads to improved accuracy, faster fulfillment, and increased customer satisfaction.

Further, overcoming personnel and resource attrition, as well as shorter turnaround times and higher efficiency and quality, are benefits of outsourcing order processing.

Scalability and flexibility

One advantage of outsourcing order processing is its scalability. As your business grows and order volumes change, a third-party provider can adjust its services to meet your needs.

This flexibility helps your business manage peak seasons and high demand without compromising service quality.

Focus on core competencies

By outsourcing order processing services, your business can focus on core competencies and strategic initiatives, leading to more innovation, growth, and competitive advantage.

Instead of being overwhelmed by daily tasks, your team can prioritize value-added activities for business success. Outsourcing order processing enables you to focus on your core business processes, such as sales, marketing, and product development.

Focus on core competencies

Tips for outsourcing order fulfillment process

Ensure effective order management process flow when outsourcing by applying the following:

  • Define clear objectives. Clearly outline your expectations, including turnaround time, accuracy, and communication frequency.
  • Research potential partners. Investigate multiple fulfillment providers, considering their experience, reputation, and client testimonials.
  • Understand cost structure. Request detailed quotes to understand pricing structures, including fulfillment fees, storage costs, and additional charges.
  • Ensure scalability. Choose a provider capable of scaling your business growth without compromising efficiency or quality.
  • Check technology compatibility. Confirm that your systems (e.g., inventory management and order processing) integrate seamlessly with the provider’s technology.
  • Negotiate contract terms. Negotiate terms that align with your needs, including service level agreements (SLAs), termination clauses, and pricing adjustments.
  • Establish communication channels. Set up regular communication channels to address any concerns, updates, or modifications promptly.
  • Monitor performance. Regularly monitor key performance indicators (KPIs) such as order accuracy, shipping times, and customer satisfaction to ensure the provider meets expectations.
Outsourcing FAQ

What is Data Entry?

Data Entry: Definition, Costs, and Outsourcing Guide

Data entry is the act of typing, transcribing, or importing information into a digital system so it can be searched, sorted, and reported on. The work covers invoices, forms, surveys, CRM records, product catalogues, and scanned documents. Roles include clerks, transcribers, encoders, and coders.

The job sounds simple, but the cost of getting it wrong is steep. A 2017 Harvard Business Review analysis found only 3% of company data meets basic quality standards — which means most teams quietly pay for the cleanup later in bad decisions, lost customers, and re-work.

That cost pressure is why data entry sits near the top of every outsourcing shortlist. It is rules-based, measurable, and easy to move offshore without disrupting the core business. Most back office teams in lower-cost markets pick up the work without missing a beat.

How it works

A working data entry pipeline has four moving parts — the source document arrives in a queue, an operator keys or imports the fields, a second pass verifies the record, and the clean output lands in the target system. Quality is measured by accuracy rate, throughput, and turnaround time, not by hours at a keyboard.

Most operations now blend humans with software. Optical character recognition (OCR) and intelligent document processing (IDP) handle the structured fields, and the operator focuses on edge cases — handwritten notes, low-resolution scans, multilingual forms. Deloitte's 2020 intelligent-automation survey reported that 78% of organisations were already implementing robotic process automation, often inside the same workflows that used to be purely manual.

Pricing benchmark (2026) US in-house Philippines outsourced Hourly cost $18–$25 $5–$9 Typical accuracy SLA 98% 99%+ (double-key verified) Setup time 4–8 weeks 2–4 weeks Shift coverage 1 shift 24/5 or 24/7

Cost figures are indicative ranges based on common BPO quotes; double-key verification means two operators independently enter the same record and the system flags any mismatch.

Examples

Real-world data entry work is broader than it looks. Four typical engagements:

E-commerce catalogue management: Amazon and Shopify sellers route product uploads (titles, SKUs, attributes, images) to offshore teams. A mid-size apparel brand might process 5,000–20,000 SKUs a season, and a misfiled size or colour code can kill conversions overnight. Healthcare records: US clinics outsource the keying of paper intake forms and lab results into electronic health record systems like Epic and Cerner. HIPAA-compliant providers in the Philippines and India dominate this niche, often with nurse-trained encoders on the floor. Financial services: Banks and insurers send claims forms, KYC documents, and loan applications to BPO partners. JPMorgan and Allianz both run large captive and outsourced data operations in Manila and Bengaluru, with peak-season surges absorbed offshore rather than through onshore overtime. Survey and research data: Market research firms like Nielsen and Kantar use offshore encoders to digitise field surveys into SPSS or CSV formats within 48 hours of collection, so analysts can run the first cut while the topic is still fresh.

The Philippines is the single biggest delivery market. The IT and Business Process Association of the Philippines (IBPAP) reported the sector hit $40 billion in revenue and 1.9 million workers by 2024, with back-office and data work as one of its three core service lines.

Related terms Back office: the support functions, including data entry, that keep operations running but don't face customers directly. Business Process Outsourcing (BPO): the umbrella delivery model that data entry usually falls under. Data processing: what happens to the data once it's been entered, including validation, transformation, and analysis. Optical character recognition (OCR): software that converts scanned text into editable digital characters, reducing manual keying. Robotic process automation (RPA): bots that mimic keystrokes to enter data into legacy systems without an API. Knowledge process outsourcing (KPO): a higher-skill cousin of data entry where the offshore team also interprets the data, not just enters it. Transcription: the audio-to-text variant of data entry, common in legal, medical, and media work. FAQ What does a data entry clerk actually do?

A data entry clerk reads source documents and types the fields into a database, spreadsheet, or business application. The job often includes light verification: matching a name, fixing an obvious typo, or flagging an incomplete record for review.

How much does it cost to outsource data entry?

Philippines-based providers typically quote $5–$9 per hour in 2026, against $18–$25 for an equivalent US in-house role. That puts savings in the 60–70% range once benefits, equipment, and floor space are included.

Is data entry being replaced by AI?

Pure keying is shrinking, but the role is shifting rather than disappearing. OCR and IDP handle the easy fields; humans still review exceptions, train the models, and own the final accuracy number — especially in regulated industries.

What accuracy rate should I expect?

A reasonable benchmark is 99% record-level accuracy with double-key verification, and 98% on single-pass entry. Anything below 97% on routine forms is a red flag.

Do I need an NDA or specific certification?

For sensitive work, yes. Healthcare engagements need HIPAA-aware providers, payment data needs PCI DSS, and any EU customer data triggers GDPR. A signed NDA is table stakes before sample files change hands.

How fast can a data entry team ramp up?

A pre-vetted BPO partner in the Philippines can typically start with a pilot batch in two to four weeks, then scale to a full team inside 60–90 days. Building the same team in-house usually takes twice as long, mostly because of hiring lead times and floor-space lease.

What should I keep onshore versus send offshore?

Keep the work that needs in-person context, executive sign-off, or live customer judgement onshore. Send the high-volume, rules-based keying offshore, and treat the offshore team as the primary owner of accuracy SLAs and throughput reporting.

Want a faster path than building it yourself? Get three free quotes from vetted data entry providers and compare hourly rates, accuracy SLAs, and shift coverage in one view.

What is Omnichannel Customer Service?

What is omnichannel customer service?

Omnichannel Customer Service uses different communications methods (such as email, SMS, live chat, social media, geo-tagging, and QR codes) across a customer's lifecycle to create a unified brand experience.

Aside from creating a seamless experience when relating to customers, from a marketing perspective, omnichannel customer service allows greater control over a customer's experience and creates more opportunities for retention and up-selling.

For example, Disney allows users to book tickets to Disneyland on mobile, and then further lets them plan out their trip itinerary.

Visitors can use the Disney app to review restaurants, locate ticket sellers, and map out amusement rides while also providing an estimate on the wait time at each ride. In addition, visitors receive a Magic band that acts as a combination room key, photo storage, ride ticket, and charge card.

Omnichannel customer service strategy

Creating a seamless customer experience is a task for experienced customer service companies, web developers, and programmers. Outsourcing is a popular business solution that enables companies to provide exceptional omnichannel customer service whilst saving on staffing cost.Outsource Accelerator provides you access to great customer service representatives that you can outsource from the Philippines starting from $6 per hour, where you can save up to 70% on staffing cost. We have over 3,000 articles, 200+ podcast episodes, and a comprehensive directory with 700+ BPOs… all designed to make it easier for clients to learn about, and engage with omnichannel customer service outsourcing.

What is Customer Experience?

What is customer experience?

Customer experience (CX) is often defined as the overall interaction of the customer and organization for a certain period of time. This interaction constitutes the following: customer involvement, customer journey, and the environment. 

Having a positive review on each point of contact means that the customer experience is pleasant.

Customers’ involvement may range from emotions, whether rational or irrational, to physical needs, or psychological needs. Moreover, it can extend from the simple act of talking with customers up to the product packaging, features, reliability, and affordability. 

Overall, a positive customer experience is an excellent competitive edge that your company should provide in order to stay competent and successful in the market.

Why is customer experience important?

Providing an excellent customer experience is important for any business. The better CX you deliver, the more customers you will gain and retain. 

Additionally, service representatives would have to deal with lesser customer complaints and product returns.

A company with a great CX is projected to earn:

More loyal customers Increased customer satisfaction Positive reviews and recommendations Customer experience outsourcing

Outsource Accelerator provides you with information about what to look for in outsourcing companies that can help you create a platform that encourages a positive customer experience. 

It is important to work with someone who can help your customers have a memorable journey with you, which is essential in achieving customer loyalty. After all, customer loyalty is the foundation of brand recognition and credibility in the market. 

Outsourcing helps you work with professionals who are well-versed with the right skills and experience to implement customer service strategies that work.

What is What is business process outsourcing??

What is business process outsourcing (BPO)?

Business process outsourcing (BPO) is the practice of contracting a third-party provider to run a defined business function such as customer support, payroll, accounting, or IT helpdesk. The provider takes ownership of the people, process, and technology, and bills you on a per-seat, per-transaction, or fixed-fee basis.

BPO sits at the intersection of labour arbitrage and operational focus. You hand off a non-core function to a specialist that can run it cheaper, faster, or better, and your in-house team gets to concentrate on what actually moves the business.

The category covers everything from a 4-seat phone team in Cebu answering after-hours calls for a US plumbing firm, to a 5,000-seat captive in Manila handling global claims processing for a Fortune 500 insurer. Same idea, very different scale.

If you've used Apple support, ordered from Amazon, or paid with Wells Fargo, you've talked to a BPO provider — you just didn't know it.

How it works

A BPO engagement runs in three layers: contract, transition, and steady state. You scope the function, sign a service level agreement that locks in response times, quality thresholds, and pricing, then transition the work through documented playbooks and parallel runs before the provider takes the keys.

Pricing usually falls into one of four shapes:

Model How you pay Best for Per FTE (seat) Fixed monthly rate per agent Steady-volume work like inbound support Per transaction Set fee per call, ticket, or invoice Variable-volume back-office tasks Outcome-based Tied to a KPI like CSAT or collections Mature processes with clean metrics Hybrid Base FTE rate plus variable bonus Long-term partnerships

Location choice drives most of the savings. Sending work to the Philippines or India (offshoring) typically cuts loaded labour cost by 50–70% versus a US in-house team. Sending it to Mexico or Colombia (nearshoring) trims 30–50% while keeping you in roughly the same timezone. Keeping it domestic (onshoring) protects timezone and language fit but barely moves the cost needle.

The provider absorbs the recruiting, training, real estate, tech stack, and compliance burden. You absorb the vendor-management overhead and the risk that comes with handing a function to an outsider.

Examples

The global BPO market hit roughly USD 347.95 billion in 2025 and is projected to grow at a 10.05% CAGR through 2035, according to Precedence Research. That growth is concentrated in a handful of hubs and a handful of named buyers.

Google has used Philippine and Indian BPO partners since 2016 for content moderation, ads review, and customer support — a quiet workforce that scales with each product launch. Meta contracts Accenture and TaskUs in Manila for content moderation; the work pulled enough scrutiny in the early 2020s that Meta eventually broadened its provider base across multiple regions. Wells Fargo has operated a Manila back-office hub since 2011, handling mortgage processing, AML checks, and treasury operations for the US parent. JPMorgan Chase runs large captive and outsourced operations in India and the Philippines for KYC, trade settlement, and analytics.

The Philippines remains the standout English-language hub. According to the IT and Business Process Association of the Philippines, the country's IT-BPM sector generates roughly USD 40 billion in revenue and employs about 1.9 million people, with growth targets pushing past 2.5 million by 2028.

Related terms Outsourcing: the umbrella term; BPO is the back-office and front-office slice that runs whole processes rather than one-off projects. Offshoring: moving work to a distant country (e.g. US to Philippines). A location choice, not a contracting choice. Nearshoring: moving work to a nearby country (e.g. US to Mexico) to keep timezone and culture closer. Knowledge process outsourcing: KPO handles judgment-heavy work like legal research or equity analysis, not transactional tasks. Call center: one delivery format inside BPO, focused on inbound or outbound voice. Back office: the non-customer-facing operations layer that BPO most commonly absorbs. Service level agreement: the contract clause that defines what "good" looks like in a BPO deal. FAQ What is business process outsourcing in simple terms?

BPO is paying another company to run a piece of your business for you, usually a repeatable function like answering support calls, processing invoices, or managing payroll. You keep the brand and the strategy; they run the operation.

What is the difference between BPO and outsourcing?

Outsourcing is the broad category — anything you contract out, including one-off projects. BPO is the subset where a provider runs an ongoing, defined business process end-to-end, typically with its own staff, systems, and SLAs.

Is BPO only about cost savings?

No. Cost is the entry argument, but mature buyers cite access to specialist talent, 24/7 coverage, faster scaling, and freeing in-house leaders to focus on growth as bigger long-term wins. See the directory of vetted providers on Clutch for how the market positions itself today.

What functions do companies outsource most often?

Customer support, IT helpdesk, finance and accounting, payroll, HR administration, content moderation, and data entry top the list. Higher-judgment work like legal research, equity analysis, and medical coding has shifted to KPO providers over the last decade.

Which countries dominate the BPO industry?

The Philippines leads voice and customer experience, India leads IT and analytics, and Latin America (Mexico, Colombia, Costa Rica) leads nearshore work for North American buyers. Eastern Europe serves Western European clients on similar terms.

How do I choose a BPO provider?

Match scale to your volume, check for relevant compliance (ISO 27001, HIPAA, PCI DSS, SOC 2), ask for two reference clients in your industry, and pilot a small scope before committing to a multi-year contract. Walk away from any provider that won't share agent attrition data.

Ready to scope a BPO partner? Outsource Accelerator lists 4,000+ vetted providers across the top global hubs — use the directory to shortlist, compare pricing, and book intro calls without paying a referral fee.

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About OA

Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO).

The #1 outsourcing authority

Outsource Accelerator offers the world’s leading aggregator marketplace for outsourcing. It specifically provides the conduit between world-leading outsourcing suppliers and the businesses – clients – across the globe.

The Outsource Accelerator website has over 5,000 articles, 450+ podcast episodes, and a comprehensive directory with 4,700+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.

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