6 Tips to efficiently manage your e-commerce inventory in 2023
Whether you have a small e-commerce business or scaling up your e-commerce business in Egypt or the Gulf region, effective e-commerce inventory management is key to your business success.
In this article, we have gathered tips and tricks on how you can successfully handle your e-commerce inventory management in 2022.
1- Set a SKU system for your products:
Without SKUs and SKU scanning devices, you are left with entering products into your system manually, which will not only consume a lot of time but it’ll also put you at risk of making human errors. So setting up SKUs and linking them to your e-commerce inventory management system is key for your business success, whether in Egypt or the Gulf region.
2- Auditing your inventory:
How can you measure whether you have overstock or understock of products if you don’t measure how much you have first?
Auditing here helps you with e-commerce inventory management in two ways: getting true data on your e-commerce inventory, whether it’s available products, sold products, returned or exchanged products, as well as faulty or perishing products, and also confirming your accounting reports.
3- Collect insights to make informed decisions:
Now that your products have SKUs, and you know how much stock you have or don’t have of everything. You can now move on to assessing your e-commerce inventory management requirements based on your e-commerce business whether it is in Egypt or the Gulf region, to choose an inventory management software that enables you to fulfill those requirements.
Here are a few of the factors you need to consider: suppliers, warehouses, product-viable time, distributions, retailers, online store, returns and exchanges, profit turnover, purchasing prediction, stocking alerts. These are all markers you need to have real-time reports on to be able to make the best decisions you can when it comes to stocking products, communicating with suppliers, syncing the retailers’ stock with your own, consolidating warehouse spaces to be cost-effective...etc
Once you know your e-commerce business needs when it comes to e-commerce inventory management, you’ll be able to pick and choose the proper system for your needs.
To make it easier for you, here are 2 types of inventory management software that could benefit your business or help you narrow down your options.
Multichannel E-commerce Inventory Management:
Whether you sell through physical and e-commerce stores, or through an e-commerce store, and also with retailers. This means that your business has different distribution channels, and this requires a system that can factor in the data coming from these channels and consolidate it for you to access it from anywhere.
In addition to that, you can set up alerts within the system to alert you when your products are low in stock with enough time ahead for you to order from your supplier to avoid overselling with limited stock.
Real-Time E-commerce Inventory Management:
If your business is growing at a large-scale enterprise level, then a common e-commerce inventory management software might not do the trick.
With scaling upwards, you face supply chain issues, warehousing, and operations issues, not to mention distribution and tracking issues.
Real-time inventory management software helps you gain more control over tracking: your e-commerce inventory, knowing the number of incoming orders, outgoing shipments, returns, and exchanges, the stock level of each product, and all of that is in real-time and accessible on one platform for you to manage.
Real-time e-commerce inventory management software is also capable of analyzing data and producing reports to help you make decisions to pivot your business and help you become more proactive.
Real-time inventory management software helps you manage the supply chain. It also syncs and manages different warehouses in different countries like Egypt and the Gulf so that you can control the stock levels and be ready to order in time for your e-commerce business to be always in stock.
4- Assessing previous data and purchasing patterns:
It takes both assessing previous purchases, customer patterns, sale surges due to trends or seasons, and also a market sense to be able to predict how much stock of which products you require for the upcoming period and when exactly do you need to restock to be able to fulfill your orders on time.
Of course, numerous e-commerce inventory management software generates data reports and assessments; some will even produce predictions for you and tell you how much stock you need to acquire to carry you through.
5- Finding the sweet spot of inventory stock:
There are two things you need to avoid at all costs when it comes to your stocks: overstocking by bulk ordering and overselling with limited stock availability, creating stockouts.
The first will harm your profit margin; by bulk ordering from the supplier, you’ll most probably be paying a large deposit amount, so that’s a portion of your assets and another portion is your products sitting in your warehouse.
If your products are seasonal or have a short shelf life, this leaves you with a limited time to sell these products; otherwise, you’ll have to discount them, hence harming your profit margins, and putting you in overdraft with your suppliers.
One way to boost your sales is by creating effective marketing campaigns that would give you a sales boost and help you with releasing your products when they are still viable and season-appropriate.
The second will harm your business as it directly affects your customer relations, no stock available; means longer shipping periods and lower satisfaction rates.
“According to research, 31% of customers switch to another brand on the first instance of a Stockout”.
So, finding the sweet spot where you are not overstocking or understocking your inventory is key to having a stable and scalable business.
6- Knowing your reordering point (ROP):
It’s recommended that you have enough inventory to last you 4 weeks at a time and taking into consideration how much time it takes you to audit your inventory and how much time your suppliers need to send you the products will give you a ballpark number on when you should stock up your inventory.
When it comes to your e-commerce inventory management, there will always be customisable tweaks that only you can know for your e-commerce business, whether it’s in Egypt or the Gulf region.
Our question to you is this, how do you currently manage your e-commerce inventory, and what are the problems you're facing with your current method?
If you need a consultation with our experts on how you can optimize your e-commerce inventory management, contact us and one of our representatives will contact you to set it up ASAP!