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Optimized eCommerce inventory management should be the goal for any online retailer. There is quite literally no downside for the business that has full command of its inventory, save for the envy from its competitors.
Attaining this might seem like a daunting task, but it doesn't need to be. With the right combination of focus, discipline, and the power of an inventory management software system (IMS), merchants of all sizes can harness the incredible changes that optimization will bring.
At SkuNexus, we design management software solutions for eCommerce companies, and we see the positive impact those systems have on our clients’ entire organizations.
Here are 10 benefits of optimized eCommerce inventory management to consider if you are thinking about making a change for the betterment of your business.
The amount of data contained within an IMS, from supply chain vendors to outbound shipping, is massive, and any errors within that data will only become amplified as the information is shared with other software.
When a management system applies automation to formerly manual tasks, increased data accuracy is an immediate result. And, by increasing that accuracy across inventory processes, the entire inventory management process is simplified.
Whether it is digesting lead times or monitoring current stock levels or predicting a surge in demand, the system should provide consistent and verifiable data that you can trust.
By automating and optimizing inventory management, you can ensure the prevention of manual data entry errors. This will provide your business with an accurate picture of what's in stock, where it is located, and help make informed decisions about restocking for the future.
Automated ordering from suppliers is an inventory management software process that uses technology to streamline order management. Because orders are sent electronically, the need for manual actions is eliminated and errors are reduced as a result.
This can certainly be linked to the inventory forecasting (aka demand planning) functionality of a powerful IMS. With this further automation, the system makes crucial decisions “in the background” that can help foresee and circumvent supply chain delays.
Automated ordering also allows companies to keep better track of their inventory and reduce costs by tracking average order sizes, comparing prices from different vendors, and even negotiating prices with suppliers.
Supply chain insights and inventory management can have a profound impact on your entire business, and satisfied customers are one of the most important. Accurate and up-to-date information about product availability allows shoppers to easily check stock levels and order exactly what they need with the confidence that those items are indeed in stock.
An organized system also lets customers quickly find out when new items become available, when their backorders can be filled, and can help ensure that they are not overcharged due to incorrect pricing data.
WIth an optimized inventory management process, merchants can provide their customers with a smooth and enjoyable shopping experience.
Increased inventory visibility gives online retailers real-time data and insights into stock levels across all sales channels. This allows them to quickly identify and address any potential issues with inventory levels (stock-outs or overstocks), and make the necessary adjustments (bolster safety stock, postpone inbound orders) before the problems even arise.
With improved visibility, businesses can optimize inventory to ensure customers have the right products in the right place, at the right time. Better insight also helps them refine and improve demand forecasts, and adjust inventory levels accordingly.
The competitive edge of better visibility continues all the way to the bottom line. Having an overview of inventory and the supply chain helps merchants avoid paying too much for logistics and warehousing, avoid the carrying costs of unsellable stock, and helps decrease shipping fees by informing strategic placement of products based on regional demand.
With real-time data and full transparency, your team can make better-informed decisions and quickly take action. Knowing exactly how much inventory is arriving at or leaving a warehouse, for example, helps to ensure that all stakeholders are up-to-date and working in sync.
By providing these insights, supply chain partners can share information, coordinate operations, and work together more efficiently for the benefit of all parties. Teams can identify potential issues and the associated risks, and take proactive measures to ensure operations continue to run smoothly.
Open communication is always positive, and the free-flowing data that comes with well-designed management systems helps reduce errors, cuts time off of order processing and fulfillment, and fosters better relationships among staff members.
Optimized eCommerce inventory management can lower operating costs in a wide range of ways. We mentioned the reduced carrying costs achieved by helping limit dead stock, as well as cost-savings on logistics, but other savings exist, as well.
By better gauging customer demand, the cost of lost sales due to stockouts can be greatly diminished.
Lower labor costs can also be achieved by automated systems reducing the amount of time staff spend tracking and managing inventory. This eliminates the need for time-consuming and pricey manual counting. The lower inventory levels yielded by better demand planning can also help lower labor costs, as staff will not have to spend time handling and organizing excess stock.
All of the positives that come from better inventory management can enhance a brand’s customer service. Visibility and tracking give merchants the ability to keep customers much better informed, provide them specific information about things like delivery dates, and let them know when a backordered item will next be available.
A proper inventory management system can also keep track of customer order histories, allowing businesses to better anticipate customer needs and provide tailored service. All of these features combine to create an improved customer service experience, making an eCommerce inventory management system an invaluable tool for any business.
Easier tracking of stock movements is facilitated by providing a centralized system for monitoring inventory levels, orders, and shipments. This allows businesses to assess stock levels in real time, trace inventory items from purchase to sale, and generate reports to help make needed adjustments.
With accurate and up-to-date information on stock levels and orders, businesses can quickly identify any errors (incorrect item counts, delayed shipments, etc.), and the system also allows merchants to set reorder points so that they can be prepared with the right amount of inventory at all times.
The comprehensive suite of tools for tracking and managing inventory an eCommerce inventory management system offers can help your business grow at scale. With accurate data flowing freely between platforms, this model provides an efficient way to monitor and control the movement of goods and materials, as well as the availability of stock, at any given time.
It also helps ensure that all available inventory is used to its fullest potential. By automating the process of stock management, it reduces the amount of time and resources required to manage inventory, thus allowing businesses to scale up their operations quickly and efficiently.
In addition, by helping identify and eliminate excess stock, valuable resources and capital can be unlocked for use elsewhere.
Automation reduces manual errors. It is as simple as that. Real-time visibility into inventory status enables businesses to make informed decisions, predictive analytics helps businesses predict future demand, and automated processes ensure that orders are processed and shipped quickly and accurately.
All of this combines to dramatically lessen risks of all sorts across your entire enterprise.
At SkuNexus, we design flexible inventory management systems that can be custom-tailored for any type of eCommerce business. If you would like to see how it could help you, please schedule a demo.
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