6 Inventory Tips for Effective Online Store Management
Prioritize the products according to the attention they need.
Just like in every industry, running an online store also needs putting into use a few tricks - not just to bring it more numbers of visitors but also to hype the sales figures. These are different from the various management tasks you are familiar with – or maybe – you already know those tricks; it’s just that your implementation of the same is not appropriate. Either way, you are at loss!
But fret not! The web-store improvements and enhancements are not a gargantuan task and you’ll like the way they will contribute further to your online business growth. An improved online store management procedure also means streamlining various other related processes and together, you will soon find better revenue jingling into your bank account.
To start with, set Par Levels for every product in your inventory, which means, the minimum number of products at hand at any given time. Order more of those products only when your inventory stock dips below this level, not before. It will help you to stop your money from getting blocked. But when you order, make sure the ordered quantity takes you just above the par level. This way, you will be able to systematize the process of ordering and the best part is, this is a decision you will make for once and set a guideline, which your staff will follow. However, you need to change the par level with changing market conditions.
Note: Par levels vary according to the products and how sellable they are; you also must calculate how long it will take to get back into stock.
You heard about FIFA; now hear about FIFO. First-in, First-out makes for an important inventory management procedure for your online store. In simple words, it means that you sell your products from the older stocks first. What gets in first gets sold first; especially, perishable goods. It will stop them from becoming unsellable spoilages. So start with re-organizing your warehouse, bringing the older products from the back to the front.
Note: Even for non-perishable products, FIFO brings great benefits. It will stop the packaging from becoming worn over time and stop the products from turning obsolete.
Managing a good relationship with your suppliers is a vital part of an effective, online store inventory Ebay Storefront Design, for it will make them more willing to work with you towards solving problems. Additionally, you must be able to adapt quickly. This can be done in a number of ways, for example, returning slow selling items and making room for new, fast-moving product; restocking a fast-selling product promptly, troubleshooting manufacturing issues or expanding your storage space temporarily.
Note: Maintaining a good relationship and good communication with product suppliers can help you negotiate upon minimum order quantities, which means you will be blocking less money. It will also prove helpful when your sales are suddenly up and you need more products in your inventory. A happy supplier will always adjust production according to your needs; shall be empathetic if you run into a shortfall regarding cash inflow and ask for credit and similar issues, including cancelling prior orders.
Count your entire inventory at once! A large number of businesses do this only once, during the year-end, to tie it in with their accounting and income tax filing.
However, this can become incredibly disruptive to your business; besides, it’s tedious. Go for spot-checking instead; throughout the year. Simply choose a product, count the numbers and tally it with what the number is supposed to be.
Note: Checking fast-moving products this way shall help you manage your inventory better! You can do it each day, each week or each month, with higher value products counted more frequently.
Prioritize the products according to the attention they need. ABC analysis is a great way to go; it will help you separate those products that require a lot of attention from those that do not.
Note: Create three categories for the products, putting them under the following heads:
A - High-value/low sale
B - Moderate value/moderate sales
C - Low-value/high sales
Predict the demand for a (group of) product accurately by considering a few variables:
• Market trends.
• Previous and current year sales during the same week (shall give you the growth rate).
• Guaranteed sales (contracts, subscriptions etc.).
• Seasonal and overall economic factors.
• Upcoming promotions and planned advertisement expenditures.
But hey! There might be someone out there who doesn’t want to go this way; for them, dropshipping happens to be the best choice. No inventory Section 508 Compliance required at all! Just put the burden of delivering the goods upon the shoulders of the manufacturer/wholesaler and completely remove headaches that stay associated with inventory management.
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Jul 25, 2016