What is Order Splitting (Split Shipment)?

Order splitting, also known as split shipment, is the fulfillment strategy of dividing a single customer order into two or more separate shipments. This occurs when the items in an order are located at different warehouses, when some items are in stock while others are on backorder, or when splitting the order results in faster or more cost-effective delivery than waiting to consolidate everything into one package. While customers experience the order as a single purchase, the operational reality behind the scenes may involve multiple pick-pack-ship workflows executing in parallel across different facilities.

Why It Matters

In a multichannel, multi-warehouse fulfillment environment, it is increasingly rare for every item in a multi-line order to be available at a single location. Rather than delaying the entire order until all items can ship together—frustrating the customer and tying up inventory—order splitting allows businesses to ship available items immediately from the closest or most cost-effective location. This approach reduces delivery times, improves customer satisfaction, and keeps inventory moving.

However, order splitting is not without trade-offs. Each additional shipment incurs its own packaging, labor, and carrier costs. A two-way split doubles shipping expenses on that order unless the cost savings from shipping from closer locations offset the extra charges. Effective order splitting requires intelligent logic that weighs delivery speed against fulfillment cost, factoring in carrier rates, package dimensions, customer expectations, and margin thresholds. Businesses that master this balance gain a significant competitive advantage in delivery performance without sacrificing profitability.

How It Works

Order splitting is typically managed by the order orchestration layer of an OMS. Here is how the process unfolds:

• Inventory Check Across Locations: When a multi-item order arrives, the system checks inventory availability for each line item across all fulfillment nodes. If no single location has everything in stock, the system identifies which locations can cover which items.
• Split Evaluation: The orchestration engine evaluates whether splitting the order is beneficial. It compares the total cost of shipping from multiple locations against the cost of transferring inventory to consolidate the shipment. It also factors in promised delivery dates and customer tier.
• Shipment Assignment: Once the split decision is made, each subset of line items is assigned to a fulfillment location. Each shipment gets its own picking list, packing slip, and shipping label, but all shipments reference the original order number for customer service traceability.
• Tracking and Communication: The customer receives separate tracking numbers for each shipment, ideally with a clear explanation that their order will arrive in multiple packages. Proactive communication prevents confusion and support inquiries.
• Cost Allocation: Shipping costs for split shipments are allocated back to the order for profitability analysis. This data feeds into ongoing optimization of splitting rules and inventory placement strategies.

How Nventory Helps

Nventory’s intelligent order splitting evaluates every multi-item order against your fulfillment network in real time, automatically determining the most efficient split configuration based on inventory location, shipping cost, and delivery speed. You set the rules—maximum number of splits per order, cost thresholds, and priority tiers—and Nventory handles the rest. Each split shipment is tracked individually within the unified order view, so your customer service team always has full visibility. Automated customer notifications keep buyers informed about each shipment’s progress, reducing “where is my order” inquiries. Combined with real-time inventory sync across all your channels and warehouses, Nventory ensures that split decisions are always based on accurate stock data.