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5 Tips to Efficiently Control Your Online Store's Inventory
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5 Tips to Efficiently Control Your Online Store's Inventory
Presented By
Black Pearl Matrix
Tips to Optimize Your Online Store's Inventory Control
- Plan the Methodology
- Establish Metrics
- Find Good Suppliers
- Align Financial Management with Inventory Management
- Count on the Support of Innovation
As much as the stock control process of a virtual store involves several steps, it can be carried out efficiently with good planning and with the support of adequate tools.
The fact is that monitoring the entry and exit of goods is one of the main management routines of an online store.
And this monitoring needs to be done periodically, so that it does not affect product availability, replacement planning, exchanges and returns.
Despite the intense dynamics, this step is essential to ensure the financial health of your business and prevent products from running out of stock in your store. In other words: it is necessary to control the inputs and outputs!
In addition, the information collected from the stock can be extremely useful for the results of your e-commerce.
For example, you can highlight the products that sell the most in your online store and think of strategies to boost the least sold ones.
Thinking about it, throughout this article, we have separated some tips so that you can efficiently control the stock of your virtual store.
Why Control the Inventory of an Online Store?
In a scenario where e-commerce breaks expansion records, stock control is essential for you to exploit this moment.
And e-commerce purchases continue to grow. For example, in the first quarter of this year alone, virtual commerce generated US$ 5.2 billion in sales.
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In this sense, controlling the stock of your virtual store can help you, among other things, such as:
1. Not losing sales;
2. Keep up with the increase in demand resulting from the growth of e-commerce;
3. Prevent products from running out of stock in your virtual store;
4. Avoid product shortages;
5. Control inputs and outputs for greater efficiency in financial management.
One of the aspects that poor inventory management influences, by the way, is in your store’s financial department and your cash flow.
Imagine, for example, buying a new shipment of products you don’t need or running out of money to replace a high-output item.
In addition, in the case of perishable products, a stopped stock can end up generating inevitable losses.
The second point involves the customer experience. Suppose a shortage is bought and replenishment takes longer than expected.
The customer can give up the purchase, not come back, in addition to negative reviews on social networks or complaint sites.
For these and other reasons, controlling the stock of a virtual store is an activity that should receive important attention.
In addition to avoiding problems, this practice can bring significant gains and support the growth of your business.
Logistics and Inventory Control: 5 Management Methodologies
As indicated at the beginning, controlling the stock of an online store involves several steps. The production and storage stages, for example, are crucial.
When starting to plan internet sales, the entrepreneur needs to analyze what needs to be produced and, in the case of resale, who will supply it.
Next, you need to think about how much investment is available and what would be the best strategy to start with.
Therefore, before exploring the tips to help you control your virtual store’s stock, it is important to present some of the stock management methodologies that are part of the knowledge group in the logistics area.
1. Internal Inventory Management
The famous internal stock management is that procedure in which storage is carried out in our own warehouses and by professionals from the virtual store itself.
As it is an internal responsibility, it is necessary to adopt a series of precautions, such as: organization, conservation, cleaning, pest control and maintenance.
In addition, it is necessary to have a team responsible for controlling inputs and outputs so as not to affect sales.
A strong point of this model is the possibility of greater control and centralization of activities by the company itself.
If well executed, internal inventory management can more efficiently guarantee the quality of product preservation, avoiding risks with third parties.
Its main weakness is cost: maintaining the space, paying monthly expenses and hiring specialized labor.
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2. Dropshipping
Dropshipping is a model where there is no inventory. Products are purchased on demand.
Thus, there is no need for physical space, but it still requires good practices and great control of the entry and exit of items.
This model is more used by stores that do not have available capital to invest in large volumes of inventory.
This, by the way, is one of the main strengths of dropshipping: the maintenance cost of this model is much lower than the others.
However, unpredictability can be a big issue here, so keeping track of your online store’s inventory is even more important.
In addition, to ensure punctual delivery and product quality, good suppliers and their commitment are needed.
3. Just in Time
Similar to dropshipping, it ensures that the stock has as few products as possible and necessary to avoid losses.
For this methodology to work, everything needs to happen with maximum precision (hence the expression just in time).
Therefore, the control of sales, returns, losses and cancellations must be precise so that no customer is left without service.
Another essential point is the partnership with efficient suppliers that guarantee punctuality and agility in delivery.
4. ABC Curve
This methodology consists of classifying the products according to their flow. The “A” would be the high turnover, “B” medium and “C” low.
By separating stock in this way, you can do good cash flow planning and avoid unforeseen sales.
With the maturity of your virtual store, it will be possible to stipulate the average time for the sale of an item, thus increasing the efficiency of your processes.
The ABC curve can be adapted to any other model, after all, its objective is to optimize inventory control routines.
5. FIFO and LILO
Respectively, these acronyms mean “first in, first out” and “last in, last out”.
These apparently opposite ideas complement each other: while FIFO says that old items must have priority to be released; the LILO methodology explains that new ones must be sold first.
Combined, the two strategies help your e-commerce to leverage sales strategies and avoid losses with product expiration.
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5 Tips to Optimize Your Online Store's Inventory Control
First of all, controlling the stock of your virtual store depends on a lot of dedication and maturity in carrying out the processes.
Management requires attention and some steps can help you further increase the efficiency of your e-commerce. Thinking about it, we separate five tips that will help you with this purpose.
1. Plan the Methodology
We mentioned earlier some methodologies and concepts used in inventory management.
Decide the method that your virtual store will use to be done according to the reality of your e-commerce. That is, size, sales volume and available employees.
Once this is understood, the next step will be to determine whether to check the stock in real time, scheduling replenishment according to stock status or cyclically from time to time.
2. Establish Metrics
Establishing metrics is the most efficient way to ensure the success of a business, whether in a physical store or in an e-commerce.
Based on the collected information, strategies can be applied and analyzed to improve business performance.
Such indicators, in turn, help in actions such as the creation of promotions and product pricing.
A metric that needs to be on the radar is the time of the purchase process and the receipt of products.
Average consumption and stock coverage are also fundamental examples of important indicators, the quantity of goods purchased in a period; and the time to replenish stock are measured.
3. Find Good Suppliers
Whether raw materials or products for resale, finding good suppliers can save you a lot of headaches when it comes to controlling the stock of an online store.
Therefore, seek references and create a good relationship with suppliers.
And, in addition to speedy delivery, it is also important to focus on quality and also know the origin of the goods and the way your supplier works.
You should also have a contact list saved so that you are not left stranded when you need supplies, thus avoiding lost sales.
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4. Align Financial Management with Inventory Management
Managing your incoming and outgoing stock is crucial to the financial performance of your online store.
In this sense, seek to align the management of these processes so that they are carried out with total efficiency and complement each other.
That is, by professionally controlling the stock of your virtual store, it is very likely that your financial management will also become clearer and more organized.
5. Count on the Support of Innovation
Finally, a good tip is to seek support from innovation when you want to optimize your stock control.
The good news is that today there are already a series of free tools that can help you when it comes to controlling your virtual store’s stock, in addition to other management processes.
Inventory Control with Wix
At Wix, for example, all business owners have native inventory control, directly on the platform.
You will be able to:
1. Register as many products as you want;
2. Import product lists;
3. Determining different quantities, brands and categories;
4. Organize deliveries through different logistical channels, from the post office to collection at the store.
In addition, we provide everyone with a completely free inventory control worksheet.
In which you will find:
1. Instructions: tab with all the instructions for you to make the most of your stock control worksheet;
2. Item registration: register each item in your inventory with its respective unit of measurement;
3. Inputs and outputs: register everything that came in and out of your company’s stock;
4. Control: consolidated data from the item registration tables, inputs and outputs and inventory movement.
FAQ – Frequently Asked Questions About How To Efficiently Control Your Online Store’s Inventory
1. How to Improve Control and Reduce Waste?
2. How to Campaign Stopped Stock?
3. What is an Identified Break?
4. What is an Inventory Routine?
5. What Does Poor Inventory Control Do to Sales?
Conclusion
As you can see, there are different methodologies and processes that support entrepreneurs who want to better control the stock of their online store.
Throughout this article, we also highlight several tips to improve your results and increase the efficiency of your e-commerce.
Controlling the stock of your online store is a decisive step for your sales. With that in mind, create smart strategies to grow fast!
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