- Plans & Pricing
Shopify has established itself as a powerful solution for businesses of all sizes in the competitive world of online retail — from fresh start-ups to well-established brands and a vast number of companies in between.
Offering a user-friendly, adaptable, and scalable solution, Shopify is an attractive option for any merchant looking to start or expand their online presence. A cloud-based software operating on a subscription SaaS model, Shopify requires no prior technical expertise or coding skills to set up and launch a store. This has helped fuel the platform's explosive growth since launching in 2006 and it is now used by businesses in more than 175 countries worldwide.
Shopify offers a wide range of customizable design options with over 100 themes to choose from and thousands of additional apps to enhance your business operations. The enterprise version, Shopify Plus, offers even more customization options, and includes a powerful point-of-sale product called Shopify POS Pro.
Despite robust functionality across many eCommerce processes, Shopify inventory management has limitations. At SkuNexus, we design enterprise inventory management software that seamlessly integrates with the eCommerce Shopify platform, and we understand that merchants might not understand what Shopify can and cannot do in this area. Here, we will address a broad range of questions on the subject.
Before we dive into all manner of Shopify-specific queries, let’s get familiar with the fundamental elements of inventory management.1. What is inventory management?
Inventory management is a crucial part of supply chain management and plays a key role in the overall efficiency and profitability of a business. It encompasses the processes of overseeing and controlling the movement of goods and products, from the point of purchase or production, to the point of sale. This includes the planning, coordination, and control of the ordering, storage, and use of materials and finished products.
Effective inventory management ensures that a business has the right products in the right quantities, at the right time, and at the right place, in order to meet customer demand and minimize carrying costs. Particularly in increasingly complex multichannel retail models, this is no simple task.
Inventory management can be considered a never-ending balancing act. Carrying too much inventory can lead to increased storage costs and the risk of products becoming obsolete, while carrying too little inventory can result in stockouts and lost sales.2. What are the five elements of inventory management?
An Inventory Management System is software designed to keep track of products, inventory, sales orders, and fulfillment, between merchants, their customers and suppliers. It helps automate inventory processes and allows businesses to monitor the movement of products through the supply chain, prevent stockouts and optimize their order fulfillment process.
The centralization of inventory and order data an IMS provides is crucial for companies that sell through multiple channels, multiple warehouses, and/or bundle multiple items for sale and shipment. An inventory management system can be integrated with an eCommerce platform like Shopify, allowing businesses to track inventory across multiple channels in real time, from brick-and-mortar locations to online marketplaces like Amazon and eBay.
Typically, an inventory management system includes features such as:
Now that we have brushed up on the basics of inventory management, let’s consider what it means to manage your inventory in the context of a Shopify store.4. Does Shopify POS have inventory management?
Yes, Shopify POS (Point of Sale) has features to manage inventory. With Shopify POS, you can track your inventory levels, set up low stock alerts, and manage your products and variants.
Shopify allows for bulk updates of inventory and displays inventory history for the past 90 days. However, if you sell on multiple channels, stock levels will need to be updated manually across all online and offline stores as Shopify does not have an automatic syncing feature.
This means that if a product is sold out on Shopify, it may still appear as available on other eCommerce stores. Needless to say, this can be disastrous to the customer experience. Additionally, Shopify has limited inventory forecasting capabilities and does not allow for product transfers using third-party fulfillment services (3PLs).5. How do I set up inventory on Shopify?
Running inventory involves a number of steps to make sure you have enough stock-on-hand to meet customer demand. Here are some tips on how to effectively run inventory within Shopify:
7. What types of inventory counts work best with Shopify?
Shopify does not automatically track the cost of goods sold (COGS). However, it does allow you to set up the cost price for each product variant, and with that, you can calculate the COGS by multiplying the cost price with the number of items sold. This can be done manually, by keeping a record of the cost price of each product variant, or handled automatically by your IMS.9. Is Shopify good for large inventory?
Part of Shopify’s appeal is its versatility as an eCommerce platform that can handle small and large inventory for businesses of all sizes. However, Shopify also places limits on the number of products and variants that can be added per store.
Depending on the pricing plan you are on, and if you are planning to expand inventory, you should consider upgrading your plan to Shopify Plus, which can handle more products and variants than other plans.10. How does Shopify deal with out of stock products?
Ironically, part of inventory management sometimes involves managing what you don’t have, and Shopify has a range of methods to help merchants communicate with customers and navigate through these issues.
The range of goods sold globally via the Shopify eCommerce platform encompasses nearly every conceivable product, however there are certain types of items that cannot be sold or are bound by significant regulations. These include, but are not limited to:
Of course, Shopify's terms of service are subject to change, and the list above is not exhaustive. Shopify reserves the right to remove any product that violates its terms of service, and it's the seller's responsibility to check and comply with the terms of service and all applicable laws and regulations.12. What Type of Inventory Management System Does My Company Need?
As your company grows and channels increase, however, inventory management becomes a very different animal. The need for free data flow, real-time sync across disparate systems, and extreme organization, et al, requires a powerful IMS with capabilities far beyond the basics.
At SkuNexus, we design a full suite of enterprise eCommerce management software which can be custom-tailored to your specific needs. Our solutions seamlessly integrate with Shopify to provide merchants with a powerful platform that can dramatically increase the capabilities of your business, from increased control to greater efficiency to growing at scale.
If you would like to learn more about what our management software solutions can do for your business, please schedule a demo.
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