How Does Inventory Management Software Works for an eCommerce Business?
A healthy association with any eCommerce platform requires keeping an eye on your inventory in the very first place. Believe it or not, fragile eCommerce inventory management software can affect your online business enormously. Being an online seller, it will be helpful if you realize the importance of inventory management software on time before landing into a significant loss.
That is why online sellers must have comprehensive inventory management knowledge. This management is necessary to fulfill customer orders, manage the warehouse, and initiate on-time shipping. It can also be beneficial in terms of restricting product wastage. This tremendous software can help you manage your inventory, thus encouraging business efficiency. One of the elementary purposes of using this software is to meet customers’ demands without creating an overstock or excessive inventory. To establish a profitable, scalable, and sustainable online business, you must understand every aspect of managing inventory. In this blog, we have the workflow of inventory management software and the significant challenges you can experience while managing inventory.
Workflow of an Inventory Management Software
As you know, inventory is the product or materials that an online business intends to sell to customers for profit. It is a crucial element of the entire supply chain that enables tracking inventory from manufacturers to warehouses. The conclusive goal of inventory management is to have the right products at the right place and time. Here in the following points, we have mentioned the inventory management workflow.
Acquiring Inventory: The first step is buying products from third-party vendors, manufacturers, or wholesalers and delivering them directly to the warehouse or the storehouse.
A Stockpile of Inventory: Inventory should be stored until needed. Products and materials are transferred across your fulfillment center until it is ready for shipping.
Provides Accurate Inventory Report: An accurate inventory report can never let you experience a stock-out situation that can make your customers unhappy and disappointed with your services.
Inventory management can be an essential asset of your eCommerce business. Where overstocking of products can impact the financial aspect of your business, down stocks can drastically make your customers unhappy. To manage all these ins and outs, you require inventory management software, especially if you are dealing on a larger scale.
Significant Challenges in the Absence of Inventory Management Software
Overstocking & Downstock
In the eCommerce business, if you do not have strong control over your inventory and knowledge about your customer’s shopping habits, you may easily fall into a situation where you either can not supply demand, or you may have overestimated the total amount of inventory you require at the time to fulfill the demands. However, it can be advantageous to have an extensive inventory on hand but on the other hand, it can become of no use if you have outdated products in storage. It increases the chance of having too much dead stock on hand. Deadstock refers to such products that you can not sell because you have too much inventory and not enough demand. It happens when market trends and customers’ shopping behavior shift. On the flip side, down stocks or less stock immediately affects your market reputation, and you may lose the trust of your customers.
Lack of Visibility Across Multiple Channels
Lack of visibility is another challenge you may face as the demand increases and managing inventory across various eCommerce platforms becomes more complex. As you expand your business, you will likely decide to sell your products across multiple platforms, such as Amazon, Myntra, Flipkart, Snapdeal, etc. However, keeping track of sales and orders from each platform can become challenging unless you use eCommerce inventory management software which will help you to manage your inventory through its centralized function.
Lack of Inventory Data Insight
It is another common challenge that sellers mostly face related to inventory management is the lack of inventory data insights. In order to scale up your business, you need to consider the power of inventory data. To boost your revenue and fulfill your customers’ requirements, you need to understand how your inventory fluctuates over time, how demand changes, forecast future requirements when to re-order products, etc. To implement all these steps, you require inventory data insight.
What Does Inventory Management Software Do?
Ensure Order Fulfillment
Meeting the deadline for product delivery is one of the crucial aspects of any eCommerce business. In any situation, if you cannot fulfill your customers’ demands, the result can be disastrous, as you can lose your valuable customers. An inventory management software synchronizes any order with your inventory to ensure order fulfillment. It provides you with clear visibility of available and non-available products. In this way, it can become hassle-free to fulfill your customers’ orders on time.
Restrict Overstocking & Downstock
With the help of the remarkable feature of providing accurate inventory reports, you can easily find out what amount of inventory you need to stock up. It automatically eliminates overstocking and down stocks. As a positive result, you will be able to save a lot of money to spend on improving the other aspects of your business. Overstocking can put you in the situation of facing the situation of dead stocks as well. On the other hand, down-stocks can prominently make you lose your valuable customers.
In the competitive world of eCommerce, it has become quite essential to forecast the demands of your customers. Demand forecasting can help you with selling your products during the peak season. As you know, festivals are busy days, and sales are always supposed to increase during this time. So it’s better to pull off your socks before the game begins and keep yourself in a safe position. Demand forecasting is essential in terms of enhancing your business decision about production, managing inventory, and marketing plans. It can also be helpful for profit margins, future capacity planning, cash flow, and capital expenditure.
Tracking and locating a specific inventory is indeed a challenging task to perform. Inventory software such as eVanik OWS provides you with accurate inventory reports. Thus it can become effortless for you to keep track of each and every inventory in real-time. You will be able to analyze the status of all your listed products across multiple channels and can refill your stock as soon as products are likely to get out of stock.
Centralized Inventory Management
A robust inventory management software like eVanik OWS provides the astonishing features of centralized inventory management. It eliminates the requirement of managing the separate inventory for each eCommerce platform. This software integrates with your ERP system, connects with all the marketplaces you have associated with, and makes your inventories visible in one dashboard.
In terms of upscaling your online business, it is essential to manage your inventory compellingly. Not prioritizing this aspect can put you in a difficult situation where you will not lose your customers but money as well. Software like eVanik OWS can even help you with inventory reconciliation as well. It can help in reconciling the damage & returns, claims & disputes as well. Hence, now you must understand the importance of this considerable software and its benefits.