The dos and don’t s of handling inventory
Success in the e-commerce game can be determined in a huge way by a variety of constantly changing factors. Take, for example, the behavior of consumers or regular/irregular fluctuations in the market.
You may also have to contend with oncoming and outgoing trends, targeted marketing channels and the efficiency of your e-commerce store’s back-end systems.
The amount of thought that has to go into the strategies you implement and strategic/tactical moves you make when it comes to surviving the online battlefield should not be underestimated. One wrong step and you could end up back at square one. A crucial yet likely often overlooked aspect that has the power to make or break many a budding e-commerce business is inventory.
As an e-commerce entrepreneur, the first thing that comes to mind when hearing the term “inventory” may be lots and lots of counting, the seemingly endless chore of shuffling products from shelf to shelf in an attempt to keep things in check, making sure that what you have/sell matches what’s on the books.
More than being just “a lot of work”, inventory can be a vital part of building the foundation of a thriving online store. This is especially true with the demands of today’s e-commerce environment, where consumers have become more used to buying online and expect a certain level of quality when it comes to the experience of interacting with stores online.
Here are a few tips for achieving better efficiency when it comes to handling your inventory.
- Draft a plan
Inventory is essentially somewhat of a placeholder for money. You paid for your products and you’re expecting to get that money back (and then some) when you sell them. When the structure of your inventory is as sound as the direction of your business, you may find that things just naturally fall into place. As with many other things in life, go into e-commerce without a sound plan and you might just be setting yourself up to fail.
- Calculate the “right amount” of inventory to stock
Stocking up just the right amount of inventory is a crucial yet rather tricky process. You don’t want to order too little or your customers may begin to shop elsewhere but at the same time, ordering too much can leave you with the risk of having too much extra stock that you’ll be forced to sell at clearance prices.
How do business owners know when to reorder inventory? A large number of them rely on information gleaned from previous months. Problems may arise if they don’t get complete or accurate inventory data from past records, however, and this is where a tool/solution that automatically tracks inventory movements as much as possible can come in handy.
- Don’t fall for the low price trap
Don’t count on low prices for your products all the time, it isn’t always the best choice. Suppliers are all too keen to offer you price quantity deals, like ordering 20% more stock to save 10%. Get into this habit too often and you could end up digging into your reserves to pay for stock purchases.
Purchasing stock is just the beginning of your business. There will likely be numerous hidden costs and extra expenses along the way. Don’t cripple your capital from the get-go.
- Use the First-In-First-Out (FIFO) principle
The “First-in, first-out” principle states that your oldest stock needs to get sold first as opposed to clearing your newer stock first. This is especially important for perishable products that can spoil over time (although non-perishable products are also susceptible to damage or wear and tear). Don’t keep your old stock sitting around in the warehouse, identify these items and get rid of them before you touch new stock.
Stock Sync is changing the game for e-commerce inventory management. With a huge number of integrations, your e-commerce store can now sync stock from various suppliers and sources such as Etsy, Walmart, eBay and more. Your intelligent Stock Sync app gets all your stock nicely fitted into format and you can even set it to automatically download latest stock items from your suppliers via download links. There are plenty of other features and functions that you shouldn’t miss out on as well. Head on over to the Stock Sync website to get your online shop synced up with the future.