Stockouts and backorders are a reality that many eCommerce retailers are still figuring out how to grapple with. Online retail can often be in flux dependent on advertising, marketing and seasonality. It is much harder to predict a stock-out online than it is in a brick-and-mortar store. Inventory management is critical to keeping eCommerce operations like a well-oiled machine.
A common customer service bottleneck is customers that place an order online, receive a confirmation, only to have the order cancelled later because the product was not actually in stock at the warehouse. Inventory that is not real-time can upset the balance between the online store and what is actually viable. This can lead to customer dissatisfaction, loss of trust or confidence, and eventually the loss of the customer. These are a few of the reasons that integrated, real-time inventory management is essential to every eCommerce retail site.
Order Accuracy
As mentioned, it’s absolutely vital that your customers only see products that are actually in stock, and that your warehouse is providing immediate, accurate inventory counts round-the-clock. If they place an order that eventually falls through, there is enough competition in the market that a customer is not likely to return to your site. To avoid this, inventory numbers need to be updated site-wide in real time and low-stock alerts should be sent automatically to the buyers so an additional PO can be placed, or so they can contact your vendors for a re-order.
Supplier Insights
For uninterrupted distribution, suppliers need thorough knowledge of what products they have available, where these items are physically located, and whether or not they should anticipate a seasonal or promotional spike in popularity. Integrated inventory management will allow you to keep track of inventory levels while managing incoming orders from multiple channels, such as phone, in-store or online sales. It will also allow suppliers to track the changing popularity (seasonal or otherwise) of a product, know when they’re over or under-stocked, and adjust re-orders as necessary.
There are other auxiliary effects to this. You’ll have stronger insight into your supply chain, so you’ll know where your products are coming from and where they’re going. More environmentally conscious customers may want to know where the products are manufactured or what materials they’re made from, so inventory management will allow you to provide that information quickly and efficiently. You’ll also be able to track shipments so you’ll always know where your products are at any given time.
Financial Impact
If you know exactly how many products you’ve sold and exactly how many you have left in stock, you’ll have a far more accurate idea of your business’s fiscal position than you would otherwise. These won’t be your final numbers, of course, but updated, accurate accounting information may help you plan your business strategy in the months to come.
Integrated inventory management is not only good for your business, but it’s also good for your customers. It makes their ordering process easier and more accurate, and allows you tighter control and understanding over the internal workings of your warehouse and supply chain. Any eCommerce retail site should be fully equipped with real time inventory management, or else it risks a chain of unfortunate business disasters.
