Who said it would be easy? Well, it was never meant to be. As a multichannel ecommerce platform retailer, you constantly move between many different tasks. Above all, balancing consumer demand with the ever-changing supply chain challenge can quite become a task. Don’t worry, we are not here to demotivate you but to tell you that you can turn the table in your favour: accurate inventory control.
In the forthcoming section, understand what exactly includes inventory planning, challenges faced by ecommerce retailers and learn how to overcome these challenges.
What Do You Mean by Inventory Planning?
Inventory planning is the process of forecasting and estimating how many products will be sufficient to meet future sales demand. That’s all…it may sound simple, but believe us, that’s not the case; inventory planning demands your blood and sweat (of course, not literally). Inventory Planning should be in such a way that it avoids potential sales issues and at the same time fulfilling customers’ demands and keeps their satisfaction levels at the top level.
Importance of Inventory Planning in eCommerce Business
There is no denying the fact that inventory planning is a must thing to do in an eCommerce business. With the proper inventory planning, you can be ready to tackle different obstacles in the ecommerce path. Plus helps to avoid the situation of overstocking and understocking, which further prevent huge financial losses. But at the same time, it is also important to understand that manual inventory planning can be time-consuming, and any minor human errors potentially risk a lot.
Major Challenges with Inventory Planning
Half the battle is won if you know what you will be dealing with; that is why we here have prepared the list of challenges with inventory planning.
Before analysing the historical data trend, it is necessary to determine the time and length of the time period. The past orders help to determine the inventory quantity needed at present and in future. Sometimes the sales get high due to seasonal effects, so before ordering the inventory, check if it is the case.
For example, during the holiday season, the demand for crockery and home accessories may shoot up before the demand does not remain the same or high for the entire year.
While forecasting the future demand for seasonal, comparing past performance won’t be fruitful. Instead, consider year-over-year trends for more reliable numbers, but also remember that any change in customer’s perception or introduction of a new product by a competitor can bring a significant difference in demand.
It becomes challenging to predict trendy products as these products have tiny windows for opportunity. We recommend considering 15 to 30 days for prediction and not overstocking the trendy products; sell them when it’s high on the popularity label.
Being out of stock is a highly unfavourable situation for business as it is missing out on the selling opportunity. Even if you are offering backorders, there are chances that even then you may lose customers. Here we suggest you focus on top profitable products with the automated feature. It becomes challenging to handle manual inventory management with a growing business. Here multichannel inventory management software is your best bet to streamline the overall business operation.
Shipping is another major challenge in multichannel inventory management; even with the best planning, you always do not overcome an understock or overstock situation. It becomes challenging to reach out to third-party vendors, especially international vendors and discuss what the expected sales in a particular time period look like.
Things got worse when predictions proved wrong. It is vital to inform vendors in advance and regularly update them. Clear and timely communication helps to build strong relationships with vendors.
Data is everything in today’s business era. It becomes complicated to gather sales data from different platforms and analyse it to make better future strategies. The manual data extraction process is very draining and time-consuming. Plus, with the data, retailers struggle to assess the inventory level in real time.
The limited visibility to the warehouse or tracking details often misleads the path. While effective automated multichannel inventory management software collects and analyses the data for you so that you can make effective marketing and selling strategies for your multichannel ecommerce platform.
When expanding the business, ensure to keep location in mind. Location matters the most, irrespective of your business size and yet it is one of the biggest challenges for ecommerce retailers. It is imperative to understand that what works for one location or channel may not be effective for the other or multiple channels.
How to Overcome Inventory Planning Challenges with Sellershub?
Sellershub is a perfect solution to help your growing business track stock levels and automate the process based on sales volume. Sellershub is a reliable name for managing multichannel ecommerce platforms with ease. Its advanced features help to collect data and analyse it so you can form the best marketing and selling strategies.
The single centralised dashboard allows to check the performance of different channels so that you can check how each product and channel is performing. The automation saves ecommerce retailers so that you can focus on other aspects of the business. Go and book a consultation call today to understand how to make the best use of this multichannel inventory management software.
- What are the quick benefits of inventory management systems?
An inventory management system has numerous benefits; some include increased profit margin, greater customer satisfaction, and greater efficiency in running a business.
- How do we overcome the problems of inventory management?
You can invest in efficient inventory management software. The software helps run the business efficiently as it helps maintain stock levels, analyse data, take care of warehouse inventory, and much more.