How to Handle Inventory Issues in eCommerce

The business of ecommerce comes with its own set of rules and responsibilities. When you make use of multichannel listings tools and a multichannel selling software to display your products across numerous online platforms, your work as a seller multiplies. This is why we employ tools that can help us in the process, such as order management tools, dropshipping automation, multichannel product listing software, and so on.

While there are many helpful tools you can resort to, the one that you should definitely have in mind in a real-time inventory sync tool or an inventory management software, because whether you like it or not, inventory issues can crop up at any given time. It’s indeed true that an ecommerce seller needs to wear many hats to make his/her business successful, but you just can’t neglect the importance of keeping your inventory updated in the process.

Once you start neglecting your inventory, problems are bound to show up, and this especially happens when you’re in your initial days as an ecommerce seller. Let us now take a look at why inventory management is necessary for ecommerce, what the common mistakes related to inventory management are, and how they can be avoided.

Why Inventory Management is Important for eCommerce

Inventory management is important for several aspects in ecommerce. Some of those various aspects include accurate fulfilment of orders, better customer satisfaction, and improved planning and ordering. When you take into account the factors such as how competitive the market is and how easy it is for your customers to switch to another ecommerce site when orders get cancelled due to low stock, you really can’t underestimate the importance of inventory management.

Reports suggest that when businesses implement inventory management, 95.4% of the orders get delivered on time, 94.6% of the orders reach the suppliers when they’re supposed to, and the possibility of the items getting out of stock reduces by 7.5%. The ecommerce businesses who don’t use inventory management are known to lose money, customers, as well as their reputation.

Common Inventory Issues in Ecommerce and How to Handle Them

Listed below are some of the most common inventory management issues faced by ecommerce, and the ways in which you can solve them:

• Supply Chain Issues

Due to several factors of ecommerce such as cross border sales, strong competition, and multichannel selling, small and medium-sized businesses are compelled to do numerous things that classify as supply chain complexities. Some of these include increasing the level of their stock so as to display the availability to their customers, expanding their product portfolios so that their customers can have more choices, and also including more partners, all of which end up making the supply chain even more complex.

These steps introduce issues such as the problems related to the space of the warehouse and inventory processes, the products taking more time to ship and running into tracking issues as well, and the investment cost increasing overall. However, there are ways to solve these supply chain problems, too. Ecommerce retailers should remember to look up the lead time, which refers to the time it takes to fulfill an order, and this also means checking up on the weather conditions and the holidays involved.

Safety stock should also be considered, because that way all the orders will be fulfilled even if there are shortages or a delay in stocking up. Investing in an order management software and an automated inventory management software is something that’s a must, too, because it saves you the headache of inventory issues, and also aids in maintaining your real-time stock across all the ecommerce platforms.

• Resorting to Manual Updates

The standards and rules related to inventory management are different for every ecommerce platform, and not being able to adhere to them diligently results in the loss of sales coupled with expensive suspensions. While managing the compliance part is easy when you’re selling on one or two platforms, it becomes trickier when you’re an ecommerce seller across numerous digital platforms.

This is where sticking to manual updates becomes difficult, because keeping up with the wide range of requirements isn’t easy at all. The solution to this is using automated inventory management processes, so that you don’t end up struggling with the tasks related to accounting, shipping, tracking, multiple warehouses, and so on.

• Incompetent or Insufficiently Trained Employees

Regardless of the highest level of inventory management software you use, managing inventory involves employing those who work for you supervising it as well. One big mistake that ecommerce retailers make is that they don’t give their employees enough knowledge about the inventory management procedure. Therefore, in addition to using a competent inventory management software, you should also train your employees well at the same time.

While training them, remember to train more than one employee with regards to the inventory management software. There are several tasks the inventory management software must fulfill, such as recognizing the shortages and informing you about them, giving daily reports about the inventory, evaluating the stock that needs to be ordered, and being able to predict the inventory you will need in the next order cycle at a given facility.

• Not Tracking Inventory Frequently

When you don’t schedule frequent stock audits, that’s yet another mistake you’re making with your inventory management. No matter how automated your inventory management system is, errors could happen, such as in cases of exchanges that fall under untraceable inventory. Therefore, in order for your inventory to be clearer and for it to run in a smoother manner, having stock audits every now and then is crucial.

It’s best to schedule frequent checks with barcode scans whenever possible. When different sections of your stock are checked and counted on a daily basis, you can breathe a sigh of relief knowing that the number will be exact or pretty close.

• Overselling

When you’re a multichannel ecommerce seller, you display the same products on different channels. If the inventory isn’t monitored right, what happens is that you could end up selling the last item to two different customers on different online platforms. You can also oversell on a single platform if the inventory isn’t monitored well.

Getting into the pit of overselling is unpleasant for several reasons. Not only do you have to tell the customer that you can’t ship the product they bought, but you also lose quite a lot of the trust a customer has in you. Therefore, having an inventory management software becomes essential to avoid the disaster of overselling. An inventory management software takes care of the number of products you have in stock, and displays them accordingly across all the digital platforms, so that you never have to face the issue of overselling again.