In the early stages of having an ecommerce store, having a small selection of products and a few orders a day is the norm. However, as your store grows in popularity and increased traffic you’re likely to expand your product range and (hopefully!) you’ll be handling hundreds or more orders each day. As your store grows to this level, it’s important to take a look at how you manage your stock and inventory as to keep your online business as efficient as possible.
The Impact of Stock Control
A huge percentage of start-up businesses end up failing, with the main reasons for failure including:
- The product not suiting the needs of the market
- Restricted growth
- Poor money and resource allocation
- Poor customer service
When it comes to ecommerce businesses, the above issues have a strong tie to stock control and inventory management. Getting your processes for stock control efficient and correct will assist you in:
- Understanding the market; what products are successful and serving the need of the marketplace
- Grow your business by having the right stock and systems in place
- Correctly allocating your money and resource into products that will be successful
- Allow you to always have the right products in stock and thus serving customers efficiently
Having the right inventory management in place isn’t always easy, but with the right planning and resource in place, it is more than achievable. Let’s take a look at why stock control is so important when aiming for a successful eCommerce business;
1. Improving Your Sales Forecasts
Knowing what products to have in stock, and when, is one of the most vital aspects of a successful eCommerce store. On one hand, you want to have stock in to serve customers as quickly as possible, but on the other hand ordering in too much stock will only raise your storage costs. By utilising forecasting software (which surprisingly only 15% of small businesses use) you will already be heading in the right direction. By outsourcing your eCommerce fulfilment, you will have access to a range of statistics that will keep your stock management efficient.
2. Cut Your Storage Costs
It can be tempting to expand your product range when your store begins to take off but don’t fall into the trap of having a lot of stock in storage whilst only 20% of your products are making you money. Stock control can help you know which products are successful and which are just “dead weight”. By cutting out stock that isn’t selling, you’ll be able to:
- Reduce your storage costs by eliminating required space
- Make picking and packing easier
- Minimise your financial losses
Take a read of how to master your stock control system if you are a small business?
3. Efficient Returned Orders
Unfortunately, returns are inevitable when it comes to eCommerce, and whilst they are unwanted, how you handle them has a huge impact on the success of your business and your customer experience. Stock control steps in to save the day here once again. By utilising inventory management correctly, you can keep your product range relatively small but successful, which will make picking & packing far easier, therefore, minimising customers receiving the wrong product in error! By also have a clear and concise returns process in place, you will save money by repackaging or replacing products as swiftly as possible.
4. Improve Fulfilment Accuracy
Ultimately good stock control will result in easier storage management, meaning that products can be located, picked and packed efficiently as delivered to customers as quickly as possible. In addition, a warehouse management system will sky-rocket your pick and pack accuracy to 99.999% (quite the improvement on 97% human accuracy!). By outsourcing order fulfilment, you will gain these benefits along with all of the above.
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