6 Common Inventory Problems and How to Deal With Them
Identify inventory issues, can severely improve your business
A couple of years into the pandemic, people have become well-adapted to online transactions. According to Digital Commerce 360, consumers spent $870.78 billion online with U.S. merchants in 2021, a 14.2% increase from the previous year.
From a general standpoint, eCommerce keeps both merchants and customers safe by limiting physical contact while still posing great convenience as it makes everything digital and almost automatic.
With the proliferation of eCommerce for practically anything and everything, businesses need to keep their inventory stocked and up-to-date to meet the growing demands of their market. However, challenges in this field are inevitable.
If left unanswered, inventory issues could negatively impact your business, so make sure you know how to prevent and resolve them when they arise.
6 eCommerce Inventory Problems and How to Address Them.
Failing to solve inventory issues, let alone identify them, can severely affect your business. Not only can this result in a loss of revenue, but it can also affect your overall brand reputation.
Here are some inventory problems to look out for in your eCommerce business and how to address them.
1. Managing multiple channels and warehouses
You’ll likely start with one channel for your sales and a single warehouse for your supply. But as your business expands, the number of channels and warehouses you’ll use will also increase, which could be good for business if you know how to manage it.
Without a streamlined solution in place, you will have difficulty keeping tabs on several things like what you’ve sold, how many products you have left, and when you should restock on the different channels you have.
To handle multiple channels and warehouses smoothly, you need to integrate an inventory management system into your business. These systems offer time-saving automation that can improve your business and inventory process. Additionally, omnichannel solutions coupled with proper management can also provide successful digitization for your enterprise.
2. Separate inventory systems for offline vs. online channels
Manual inventory is one of the more tedious parts of running a retail business. While this is fairly manageable with one channel, it becomes increasingly difficult to track when you have to manage your offline and online inventory separately, especially if you’re doing the updates manually.
The tried and tested Microsoft Excel is a great tool for small-to-medium-sized businesses. However, sticking with it as your business grows can become time-consuming and result in erroneous inputs. The best way to solve big-scale inventory challenges is to utilize updated tools and replace manual documentation for paperless transactions.
3. Poor inventory management
Preparing orders fast and correctly is vital to your customer’s buying process. Unfortunately, 34% of businesses will miss a shipment deadline because they’ve sold an item that wasn’t actually in stock.
Keeping your business stocked, especially during busy seasons and holidays, allows for a continuous flow of successful orders, making more happy customers in turn. Knowing the forecasts for other inventory factors like price hikes, shortages, and others can keep you in preparing order requests accordingly.
Apart from studying predictions in supply, establish transparent communication with your suppliers and partners to identify gaps in the process beforehand. Set and align timelines to ensure that production and shipping processes are accounted for.
4. Matching supply with changing customer demands
Customer preferences are ever-changing, and as such, keeping too much of the current demand could lead to inventory you won’t be able to sell in the future. On the other hand, keeping too little could leave you unable to fulfill customer orders.
Introducing an inventory management platform that includes forecasting features and analytics report is an effective way to avoid any loss for your business. With links to sales and accounting data, this helps you predict demands to schedule orders based on the shifting customer preferences and seasonal trends.
5. Lack of expertise
It’s not enough to have a good management system in place. You also need to have capable and reliable management running it. However modernized the eCommerce industry can get, it still requires a human touch to oversee systems and ensure the whole business process runs smoothly and efficiently.
Consider hiring an expert in the field. This added professional help in management can provide your business the support and best practices it needs to rise above in the industry.
6. Increasing eCommerce competition
It’s no surprise that eCommerce is a highly competitive landscape, especially with everyone wanting to get in front of the line in and international markets.
Globalized supply chains are subject to shifts that impact the competition for raw materials. Many small businesses are forced to compete for high-demand materials or hold enough inventory to control costs.
A safety stock as a buffer will help manage increased lead times due to shifting international demands for raw materials. Ultimately, proper inventory planning helps operations adapt to dynamic global supply.
Managing Your Inventory to Success.
Keeping up with inventory work can be tedious and tiring, but it doesn’t always have to be difficult. With the right people manning the right management systems, you can be sure to solve inventory problems that may come your way.
Manage and elevate your eCommerce business with the help of experts. Partner with etaily to sort out your inventory management needs and more! As an eCommerce enabler, we provide end-to-end solutions, from operations, brand, data, and technology capabilities, to e-tail your business. Contact us to learn more!