By Jodie Pride, Content Marketing Executive at Veeqo
Inventory management can be challenging for an ecommerce business. With high costs and a great deal of attention to detail required, it’s understandable why so many online businesses simply do the bare minimum just to scrape by. This might seem like an easy way out of a time-consuming and challenging task, but neglecting your inventory management could end up costing your company a lot more in the grand scheme of things by adding excess pressure to daily operations.
Here is what could happen if you do not optimize your inventory management strategy:
- Production shortages can result from not investing in proper inventory management, which could consequently drive down customer satisfaction — something you want to avoid at all costs!
- Likewise, if you are also selling on multiple online marketplaces (Amazon, eBay, Etsy, etc.) and don’t frequently check that stock is consistent across these channels, you run the risk of overselling. This means that if someone sells on eBay and the stock isn’t updated on Amazon and your website, someone could order that item as it appears to be in stock.
- On the other end of the spectrum, you could find that you’re massively overstocked on goods that aren’t selling as expected, leading to a loss in profit. Careful monitoring of your inventory can help identify which products you should buy in bulk and which are stagnating.
- You could also find employees spending hours trying to find misplaced products due to errors made by manually tracking your inventory — something that’s time-consuming, stressful, and has a huge potential for human error. Just one small mistake could disrupt your whole system and throw everything out of place.
- Shipment delays can be caused by the poor management of inventory (for example, if something is supposedly in stock, but actually isn’t) which often results in poor customer satisfaction rates.
The good news is that you could vastly reduce the number of errors made when managing your inventory while also saving valuable time by using inventory management software.
In addition to having the right software, you might consider the following tips to optimizing your inventory management strategy:
- Focus on maximizing your effort on the most profitable and fastest-moving items — your reorder strategy should be based on making sure that you are never out of stock on your high-demand products.
- Closely monitor your suppliers’ performance — make sure they are delivering all of your orders on time. If not, work with them to identify a solution to the problem.
- Don’t forget to check in with your employees from every department of your company regarding the inventory management process. This way, you will be able to address any obstacles before they become serious issues.
Check out Endicia’s inventory management software partners here.
About the Author:
Jodie Pride is a content marketing executive at Veeqo inventory management software and shipping solution for ecommerce merchants.