The Importance of Inventory Management for Ecommerce Success

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When it comes to inventory for your eCommerce business, you need to be as organized as possible. 

There are eCommerce tools out there to help you with this. And they aren’t that hard to implement.

But a full 46% of small businesses do not even track inventory.

This is an utterly mind-blowing statistic.

Not tracking your inventory is akin to not watching your personal bank account. You could suddenly be out of stock and have customers breathing hellfire on you.

But we’re going to show you how it’s great to both be on the 54% side of that stat, and use inventory management eCommerce tools.

These tools are categorized under inventory management. And they are extremely important to getting your business to the most streamlined point possible. 

This is a multiple tool category. And it comprises things that will make handling your business inventory easier and, well, manageable.


1. The Objectives Of Inventory Management eCommerce Tools

Inventory management fulfills several roles in a company. And you would probably want to know what the objectives are in using these eCommerce tools.

Minimize Stuck Capital Investment

According to statistics, inventory along with accounts receivable and payable represent 7% of the U.S. GDP or 1.1 trillion dollars in cash.

That’s a whole lot of stock capital investment. And how many of those businesses just don’t even know how much stock they even have.

The goal of eCommerce tools is to estimate the actual demand so that your stock matches. This would eliminate excessive stocking.

Uninterrupted Production 

This ensures enough timely supply of raw materials if you’re manufacturing.

Therefore, if you are doing your manufacturing yourself, some of these eCommerce tools could help you never run out of manufacturing material.

Know Exactly How Much Stock Is Buffer

When you have inventory, you don’t want to run out. But you still want to eliminate waste. 

There is a fine balance to this, and if you let a machine help you figure it our, you’ll be more likely to achieve this balance.

Multiple Warehouse Tracking

You want to make sure stock is flowing properly between warehouses. eCommerce tools for Inventory management are there to make sure this happens.


Something You Might Not Have Realized About Inventory Management

They Are Perfect For Small Businesses

Just because you don’t have a massive warehouse with robots working for you. This doesn’t mean you can’t use the eCommerce tools available to you.

There are tons of options out there. Management systems for eCommerce can be cheaper. But these options are often time-consuming. 

Other options might require a little bit more capital investment, but the time and money you save in the long run will ultimately balance it out.

The best solution for you will depend on how you fulfill items.

Do you drop ship already? Or are you using your home or a storage garage or warehouse?

Depending on this, you will need a more complex or less complex solution.


Inventory Management For Small To Medium Businesses

When you’re storing your own inventory, there are a lot of variables you have to pay attention to.

You will have to maintain balanced inventory quantity.

There is a minimum level you should have in your space all the time.

If it drops below this amount, you have to order more.

It seems like common sense, and it is. But it still works.

On the other side, like we talked about before, you have to make sure you don’t have too much inventory.


Forecasting Your Demand With Inventory Management eCommerce Tools

You don’t really have to worry about this too much if you’re dropshipping.

But this is more important for those who store their own inventory.

Let’s look at the process you would go through if you wanted to use these tools.

If you don’t have the software doing this for you, this is what it entails.

You have to determine a period that you’re going to “forecast.”

You might choose a week, a month, half a year, a year.

Most start with 1-3 months just like a personal budget timeframe.

Always re-check your numbers.

You will then have to compare it to your past sales history.

This really only works if you’ve been open for at least a year. You should have 4 quarters of data at least. 

This is your base demand. It’s a starting point for how much inventory you should order.

Also, look at your marketing plan. Compare that to your base demand and inventory predictions.

Google Trends is a great free tool for determining the demand for a product.

Are you already seeing how inventory management eCommerce tools could lighten your load?


Determining Your Minimum Stock Levels Will Be Easier 

You know your sales predictions. 

Now it’s time to determine minimum stock levels (MSLs).

You don’t want to have too much stock that you’re tying up capital and putting it at risk for loss.

But you want to hit that Goldilocks zone of inventory to satisfy demand.

You need to have at least five days of stock on hand at a time.

You can determine this by going back to your forecasted demand.

It takes some math. 

The number of days we just mentioned (5) were based on the number big companies use. If you can do with less or you need more days, don’t feel bound by our numbers.

This is just to show you how much work this takes and how much would be relieved by Inventory Management.


Centralize Your Inventory Management

Especially if you have multiple marketplaces, you want one system.

It’s really important you do this for you own sense of self and sanity.

You’ve seen part of what it entails to keep a balanced inventory and not lose track.

Having a system on hand to keep track for you and letting it do the leg work for you will give you real peace of mind.

There are a lot out there. And they each do something different. 

Do your research and find out what fits you best.

If you have a great inventory management system working for you, let us know in the comments below.

The Ultimate Guide to Scaling Your eCommerce Business

ecommerce tools


So you’ve set up your own business and it seems to be going well – you have a steady flow of orders coming in for you to fulfill at a decent rate. You’d say that’s success, right? 

It is. But what if you could expand upon that success? Why settle for good when you can have great? Why settle for great when you can have spectacular? 

While climbing the mountain of success won’t be easy, this guide will be an invaluable part of your eCommerce tools strategy.


1. Keep Marketing

No matter what, make sure you always have a good, strong marketing strategy. 

Marketing will always be there for you and your business like a true best friend. As long as you don’t kick them to the curb or forget about them. 

Utilize your social media platforms and PPC (pay-per-click) campaigns. 

Stay on top of SEO with keyword research so your website can be found and remain relevant. 

Keep using great email marketing strategies so your potential customers are in the know when it comes to your products. 

Make your website mobile phone friendly if you haven’t already.


2. Stop Doing Your Own Order Fulfillment

It may seem like it makes sense and it is the most cost-effective way to get your products to your customers. 

But, your living room or kitchen won’t allow for expansion. 

There are a couple of eCommerce tools for you to tackle this: 

  • Let fulfillment companies do order fulfillment for you, like us at Marketplace Valet

  • Ship orders directly from the supplier, skipping the middle man

This will allow you to free up your time to focus on not only scaling the eCommerce side of your business but also other areas that need your attention, too.

Besides, do you really want to go wait in line with an armful of boxes at a shipping facility?


3. It’s Time to Start Warehousing

When you think of the word “warehouse”, you probably think of a large fulfillment marketplace like Amazon.

Better inventory management probably comes to mind, too.

When you start warehousing, you allow room for growth. Your inventory can grow, you can stretch beyond your house, and your business will find growth, too.

Plus, you also avoid holding more inventory than you need by relying on a POS (point-of-sale) system.

Overall, it’s a better deal than keeping everything managed in your house. You know it’d be great to have your kitchen back … maybe even your living room, too, if there’s been spillover.


4. Decrease Shipping Costs

Fulfillment comes with shipping costs, which will need to be under control at all times.

This is especially true when it comes to international marketplaces.

This means you’ll need to stay on top of shipping prices since they regularly increase.

You’ll also need cost-effective shipping methods. To help you get started, here are some ideas on cost-effective eCommerce tools to consider:

  • Cloud-based shipping

  • Setting up business accounts with the carriers you use

  • Purchase postage online to print

  • Using a USB digital postal scale

These eCommerce tools work to keep things digital and easy to access and use, keeping the guesswork minimal.

You also don’t run the risk of sneaky price tags for shipping as you’ll be informed of prices each step of the way.

With that said, make sure to compare shipping costs as much as you can to get the best deal.


5. Try This eCommerce Tool: Use Multi-Channel Fulfillment

Why limit your products to one avenue when you can use multi-channel fulfillment?

There is a reason why 77% of sellers use numerous platforms for their products.

It may sound daunting to use many avenues to sell your products, but it can be easier than you think.

If you’re concerned that you will have to manage each shop medium separately, don’t worry – there are eCommerce tools for that. You can actually manage them in one place with Amazon Multi-Channel fulfillment.

Of course, before diving in, there are some things to consider before you decide to use this service.


6. Create a Customer Service Policy with the Customer in Mind

A customer service policy is something you certainly don’t want to forget about when it comes to your business.

No matter how hard we may work to have a 100% satisfaction guarantee, it’s not realistic. Unfortunately, things do go wrong for one reason or another and customers must be taken care of.

That’s why a stellar customer service policy is critical for keeping your customer and your business happy.

According to marketing consultant Jay Baer, only 8% of customers believe that companies have superior customer service.

Eight percent. That’s shocking, isn’t it? While companies have a lot of work to do to improve how they handle complaints, try and put yourself in that 8%.

Some things to consider for customer service:

  • Keep your word when you say you’re going to take care of the matter

  • Keep your customer informed during the process where possible

  • Learn from the situation and negative feedback to improve your business

Your business will certainly be rewarded for it.


7. Don’t Give Up

Scaling your eCommerce business is not an easy task. Of course, we want things to work instantaneously – we’re all guilty of it.

Sometimes we may want to throw in the towel when we’re not getting results in a certain timeframe.

Like all business endeavors, you will need patience and perseverance. When you’re thinking about quitting, don’t.


The Bottom Line on ECommerce Tools

It’s even OK to need help with your business success. Marketplace Valet is here to help make this process easier by offering a range of services.

If you need an extra shoulder to bear the weight of scaling your eCommerce business, feel free to contact us and we’ll come up with a plan to help you succeed.