The Top 5 Effective Ways To Manage Inventory And Stock Availability

Why is it essential to manage stock availability?

One of the critical tasks of running a retail business is inventory management and optimizing associated costs. For offline stores, it is challenging to maintain stock availability. When selling online, ensuring product availability across various retail sellers and marketplaces can impact conversions and sales effectively.

● Understocking arises when a product or brand fails to fulfill customer expectations. If this happens to repeat frequently, customers may not visit the brand's websites or store again due to the initial experience. We can't say that understocking is a fault of the brand entirely because they may not always be able to cope with the rising demands. However, it is about their caliber to match the quick change in trends with the help of historical data analysis and correct inventory forecasting.

● Overstocking: When a company purchases too much inventory, this case occurs. Having too much stock of products will result in high storage and security cost, obsolescence losses, and shrinkage. Additionally, if a company can sell this stock quickly, product quality and value will remain high, which leads to more losses.

We extracted data to study the influence of short-term stock out on the most prominent eCommerce giant Amazon for one of our clients. Here is what we learned and suggested to our client. Read to know more.

Top 5 Ways To Improve Availability Of Stock

Accurate Data Collection

When a company works to sell multiple products parallelly through a supply chain, it can easily face inaccuracy in inventory management. Discrepancies in actual product inventory and system value can lead to overstocking and understocking. The most favorable way to negate these discrepancies in lists is to use a tool to manage e-commerce inventory that informs you about your stock in real-time. This is for retail businesses that are working offline.

eCommerce Inventory Management

Proper inventory management for eCommerce is essential to ensure products are available in stores. Keeping an eye on the inventory level of your products and ensuring that you have maintained the stock to match the demand can prevent potential loss in sales and keep the company operating smoothly. Companies must ensure their stock is available across all of the online platforms they sell. Access to real- time stock data can help monitor stock updates across all the retailers and Market places if it is available or not. Retail sellers also must monitor market trends to maintain inventory assortment using consumer demand analysis.

Understanding Consumer Demand

To forecast future demand accurately, studying historical data on customer shopping trends is the only way. What do your consumers buy during holiday event seasons? What are the coming trends in your product field? Having the data-based answers to these questions will help retail sellers, and big companies properly manage their inventory based on web data analytics.

Adequate Prediction

Anticipating expectations will help to stock products during a particular season accurately. Monitoring previous sales and factors like Seasonality, promotional economic situation, and peak buying months help companies forecast demands. Studying these databases will also help companies get deep insights into the targeted market.

Improve Supplier Relationships

Regarding the supply chain, it is essential to depend on it to deliver your shipment regularly. In fact, you should maintain close bonding with your suppliers for stock availability improvement and cost-cutting. You must share important details like future demands so that your suppliers can provide products timely.

Consequences Of Managing Inventory Inefficiently

What is the impact of overstocking?

Tied-up Cash: Money invested in overstocking is a tied-up cash that your brand could have used on other activities in a better way. You can use that amount to free up repay loans and pay rent and employee salary. Inventory can frequently lead to material degradation, obsolescence, change in consumer behavior, spoilage, etc., to potential losses.

Product Expiration: If your company offers time-sensitive products like food or medicine, they tend to expire after a specific duration. For these products, overstocking can be a disaster if these products are not sold before the expiry. So eCommerce platforms need to sell these products at a lower margin to liquidate the inventory and avoid potential losses forcefully.

What is the impact of understocking?

Bad Customer Experience: less product availability will impact customer loyalty and drop customer satisfaction, which may lead to potential loss of customers in the future.

Missed Sales: If you can't provide the demanded product to customers on time, they may switch to another store or brand to meet their requirements. This can lead to a loss in sales due to frequent stockouts.

Bottom Lines

To negate the impactful consequences of understocking and overstocking, retailers and brands need real-time inventory management for offline and online businesses. At Product Data Scrape, we help these companies to plan the supply chain effectively by reducing the latency period. If you need to track your eCommerce stock, reach out to our team at Product Data Scrape and grow your business.