Managing inventory via spreadsheets is old. However, it’s easy to set up formulae to calculate numbers and share them across the workforce. The approach is widespread, and often sellers follow it to manage inventory.
Only problem: the approach is not sustainable.
- The average U.S. retail operation has an inventory accuracy of only 63 percent.
- 34 percent of businesses have shipped an order late because they inadvertently sold a product that was not in stock.
- The worldwide cost of inventory distortion (including shrinkage, stockouts, and overstock) is an estimated $1.1 Trillion.
The list can go on. It’s high time businesses realize the drawbacks of manual inventory management. It does not just leave room for errors, but also can be tedious when working across multiple sales channels or storage facilities.
As your business continues to grow, and you add additional staff and sales channels, your inventory becomes much more complicated. You need something that will grow with you, adapt, automate your processes, and remove errors. That’s what a quality inventory management software solution does.
Let’s shed some light on why eCommerce inventory management software is vital for your business.
What does e-commerce inventory management software do?
Once you start selling via multiple channels, tracking inventory becomes complicated. An inaccurate calculation can cause an hour, day, or week g hassle, not to mention the adverse impact on customer service across all the channels.
Inventory management software lets you simplify and streamline the inventory management process. One can get a real-time view of the stock and retrieve all the required information right from a single dashboard. You have a clear picture of all the items in your inventory and make an informed decision about product purchase and supply to optimize the profits.
How Inventory Management is Important for Your eCommerce Business?
1. Inventory Automation
Automation is the key benefit of having an inventory management software integrated with your eCommerce portal. Not only does it give you a competitive edge, but it also gets you rid of the headache caused by managing various aspects of your inventory. This is more striking when you are selling via multiple channels. For example, suppose you sell an item via your app. In that case, your inventory will be updated automatically for your in-store sales team to ensure that the stock matches across various channels.
This also helps you remain confident about the number of items in hand, number, or types of things you want to order, popularity, and anticipated vs. actual sales. Thus, you can make smarter reordering and sales decisions.
But that’s not it. It’s only one part of the automation. It can also help you avoid the stock-outs condition by sending notifications about low-stock alerts. Low-stock alerts can be automated to alert you when you’ve reached your threshold. This is particularly helpful if you can set low-stock alerts on a per-product basis. If you have multiple vendors in varying locations, you can take into account turnaround and typical delivery time to refrain from wasting shelf space while still avoiding stock-outs.
2. Inventory stock levels tracking
It is the most apparent element of having an inventory management system. With a product catalog within the system, inventory management software allows you to adjust qualities, change product information, assign categories and SKUs, create variants, and more. Helping you overcome ambiguity in terms of product information, you can rest assured about 100% accuracy.
Requoting our lines, this aspect of managing inventory can get complicated as and when multiple sales channels operate together, let alone be creating alias SKUs across them. Inventory management solutions can help you import your SKUs and stock from the stores and marketplace while keeping the initial settings intact. Businesses can send information to multiple channels with just a single click and ensure that every node of the widespread network receives updated information in real-time. When you have a central hub of information sending out updates, your stock numbers are much more reliable.
Secondly, inventory management systems can help you catch hold of the “safety stock.” Safety stock pads the numbers a bit to ensure the quantity you have on-shelf or in the warehouse is always just a few more than what your selling channels show. This allows you to fulfill orders when sales happen to surge without having to send a dreaded out-of-stock email to a customer.
3. Inventory reporting
- Reporting gives you vital information to understand current ups and downs in the market and analyze a stock. You can filter by low stock products and how they have been selling over a particular time duration to understand what’s most pressing to reorder. These reports tell you about the stock you have committed to ordering and give an idea of how quickly items can run out.
- Inventory reports can be valuable assets for predicting the future. Businesses can leverage velocity reports to see what you sell, at what rates, and overtime. This information helps you create forecast reports to make smarter decisions around how much stock to get through a specific period.
Top inventory management software solutions also allow you to automate and schedule these reports to make sure you have them ready on a regular cadence. You can export these reports and use them to make smarter inventory planning decisions.
An at-a-glance dashboard may be a nice-to-have for some, but the faster you can access data, the better. Having instant access data to your top-selling products, trends over time, and other sales data can help you make quick decisions when you need to. Ask about what kind of overviews and dashboards are available to you in any inventory platform you’re considering.
4. Purchase Orders and Supplier Management
Supplier relationships are as valuable as the ones you share with customers. Thriving businesses need to have up-to-date and thorough information to ensure that your orders aren’t delayed. A lot of that has to do with your inventory information. You need to add/ remove suppliers and edit their data quickly, add tags and notes, note payment terms, and add a tax ID.
Another aspect of supplier relationships is purchase orders, which are critical pieces in your communication with the suppliers. However, they can be tedious and time-consuming.
Often, orders can be delayed when you didn’t receive one part of the order on time.
Sometimes, items get delayed, and you only receive part of your order. This shouldn’t prevent you from receiving the stock that has shown up, but not all inventory management solutions allow you to receive partial stock. Choose the wrong one, and you’re stuck with unaccounted inventory until the rest arrives. That’s just inefficient, so make sure you choose one with the flexibility to work with these kinds of situations.
5. Creating Packages
A great way to move more inventory is to bundle products together. But this can cause inventory headaches when trying to account for each item while selling them together. The inventory management software you choose should allow you to bundle multiple SKUs into one while still deducting each product’s available quantities. You can then sell more without the headache that would accompany trying to manage various SKUs from a single sale.
6. Integrations With the Places You Sell
This may seem like an obvious one, but plenty of inventory management solutions out there may not fully support some of the most popular selling channels. You likely plan to grow your business, and if your inventory solution doesn’t grow with you, you’ll be doing this all over again down the line.
Suppose you sell or plan to sell on Amazon. In that case, you’ll want to look for an inventory management software solution that provides full support of Amazon’s various options: Seller-Fulfilled Prime, Fulfillment by Amazon, and Multi-Channel Fulfillment.
Do You Want Inventory Management Software Development Services for your eCommerce Store?
You can find a great friend and development partner in Matellio!
With an expert team having in-depth knowledge and industry experience, we know how to design the right solutions that align with your business needs. Our portfolio of 500+ clients, including eCommerce brands, speaks volumes about our technical knack and makes us a trusted eCommerce development company appreciated for an agile approach, cost-effectivity, quicker turnaround time, and a lot more.
That’s all about us. Let’s talk about your business. Drop your messages to avail a free 30-minute consultation from our experts.