What you should know about eCommerce Inventory Management?

Customers are the key component of every successful eCommerce business. To delight the customers, it is important to have an elevated inventory management strategy. This is the reason for the increase in the number of operating warehouses. You might have heard that if you have failed to prepare, you will be preparing yourself to fail. This fits best for all the online stores.

A lot of supply chain planning is done to make an eCommerce business successful, especially when there is a need to manage inventory. There are a lot of warehouse fulfillment service providers that are masters of inventory management. They can save you from huge repercussions such as increased logistics costs, major stockouts, wrong orders, etc.

Having a proper inventory management system can help you in reducing your expenses, save a lot of time, and streamline your eCommerce supply chain. In this way, the business can stay profitable by meeting its customers’ expectations. In this blog, we will guide you through the ins and outs of inventory planning. We will also let you know the benefits of managing your eCommerce inventory. Before we move ahead, let’s take a quick look at eCommerce inventory management.

What is eCommerce Inventory management?

Ecommerce inventory management is just the process of knowing everything about your products. This involves the details related to the stock, location, pricing, etc. These products could be provided to you through 3PL, hosted in your own warehouse, placed somewhere in a separate business, or bought through dropshipping. With the help of proper inventory management, businesses can know what products are in stock, out of stock, understocked, or overstocked.

Ecommerce inventory management directly impacts the profit and loss of a company. Check out any renownedwarehouse fulfillment, you will know the quality of control they have on their inventory. This helps them to explore the amount of revenue they generate from every single pallet. Partnering with such warehouse fulfillment, an ecommerce business can achieve greater controls on its inventory management. This helps businesses to make more accurate decisions and focus properly on other important strategies, such as marketing and promotion, demand for future storage, etc. By maintaining a stock of products, you will be able to know a lot about purchasing trends, seasonal trends, and customer demands.

Benefits of Managing your eCommerce Inventory

So by understanding the process of inventory management you better know how disrupted inventory management can harm your business. But what you don’t know is the advantages that a perfect inventory management strategy can provide to your business. Your customers will receive their products on time, you will be selling your items at a better rate that can increase your revenue. You will be able to establish a good relationship with your customers and suppliers. These are just some glimpses of having the right inventory management strategy, have a look at the below section for detailed benefits of eCommerce inventory management. 

  • Efficient business practices

Just think about the time when people have to manually learn and understand the placement of an item in a huge warehouse or packing the order by themselves for shipping. This was the process that had followed a few years ago. But now, with the digital revolution and proper inventory management, these labor hours are reduced. With a good inventory management system, you can omit the chances of any errors and save a lot of your time. This process makes your business practices more efficient.

  • Keep a check on all your inventory

Managing products in a single warehouse might be a strategy for some eCommerce business persons, but those who are aiming to touch the skies can’t keep themselves to a single warehouse. Businesses that are huge and receive thousands of orders on a daily basis need to deal with several warehouses, especially when a business involves cross-border shipping. Having an eCommerce business system will let you know the location of each and every product. This system also alerts the employees of the products that are about to finish in stock. In case you are working with multiple warehouses, you can easily keep a deep check into all your warehouses. Technologies have made things much easier than ever before.

  • Amuse all your customers

When your eCommerce website is displaying a product in stock then it becomes a must for you to make it available to your end customer. This increases your customers’ trust in you and builds a great experience for them. Ultimately, you are getting revenue because of these happy customers. With accurate inventory management, you can build better relationships with your customers. You will be showing exact information about all your products and fulfilling your customers’ expectations. Amusing all the customers becomes more challenging for businesses that deal on multiple channels such as online and offline.

  • Provides better cash flow

Spending money for holding and storing products in the warehouse becomes expensive sometimes. According to research, this expense can collectively amount to 20 to 30 percent of the total inventory expenses. With proper inventory management and planning, you can work judiciously on inventory financing. For example, with deep details of orders, you can avoid the case of overstocking and focus more on selling the current products faster. Inventory planning also helps businesses with smoother accounting during tax seasons as the reports generated are accurate and much easier to understand. At last, eCommerce inventory management helps you to make firm decisions for the growth of your business.

  • Helps in demand forecasting

As a business owner, you better understand the value of demand forecasting and its impact on your sales and revenue. With improved demand forecasting, you can make informed supply decisions. As now you will have minute details related to your inventory, you can easily meet your customers’ demand on time and can generate a huge profit.

Along with this, having a proper inventory management system helps you to plan a better storage system by eliminating your dead stock and wasted inventory. This also helps you with more reorder capabilities.