Ecommerce inventory management: 5 keys to doing it right
Ecommerce inventory management is a fundamental operation for any business that wants to stand out from the competition and increase profitability. With accurate stock control, companies can ensure the availability of their merchandise as well as speedy shipments to their customers.
For ecommerce retailers, efficient inventory management is the key to avoiding stockouts and guaranteeing fast deliveries. To manage stock well, it’s necessary to define the quantity of items needed to meet demand and determine when the goods should be replenished.
When establishing an inventory management process, it’s essential for the ecommerce retailer to have the required products on hand before the sales are made. Companies in the sector usually carry out demand planning. In other words, they estimate potential sales so that they can organise production processes and warehouse operations while maintaining appropriate stock levels.
Once the ecommerce retailer has the necessary goods in its facility, inventory management consists of these five steps:
1. Organise ecommerce warehouse stock effectively
Proper organisation of stock is critical for the success of an ecommerce business. This process constitutes distributing the products in the facility in a logical way that facilitates order picking and dispatch. This operation, also known as warehouse slotting, determines the best location for the goods in the facility.
In an ecommerce warehouse, items can be organised following certain criteria, such as the ABC analysis or the FIFO (first in, first out) method. Optimal organisation of stock is one of the cornerstones of ecommerce logistics. It enables companies to dispatch orders more quickly and cope with peaks in demand, as seen on Black Friday and during the holiday season.
2. Implementing a warehouse management system with ecommerce functionalities
Thanks to advanced algorithms, the WMS identifies the items that arrive, assigns them a location and makes a record of the merchandise that has been dispatched to be delivered to customers. Because of this, product traceability is extremely precise.
The WMS also organises all order processing, telling operators which location to go to (by designing a pick path that ensures as little travel as possible) or by supplying the pick stations with the goods required to complete the orders.
3. Use RF scanners for better inventory control
To manage inventory correctly and prepare all orders quickly, ecommerce warehouse operators resort to RF scanners. These radiofrequency devices greatly aid operators in completing their tasks: they facilitate the entry of data in the WMS, for example, by indicating which items have arrived at the warehouse. They also give employees instructions, for instance, on where to slot each item.
One of the biggest advantages of connecting RF scanners to the WMS is reduced errors. Operators’ tasks are much simpler, as they only have to follow the instructions on their devices to avoid making mistakes.
To further streamline the work of the employees, they can wear augmented reality devices (wearables) on their finger or arm. These electronic gadgets free up the operators’ hands, enabling them to pick products comfortably.
4. Sync warehouse stock with the online store catalogue
The logistics facility must be integrated with the online platforms where the products are sold, (eBay and PrestaShop, for example). This way, the minute a customer purchases a product, the operators in the warehouse can prepare the order immediately and dispatch it asap.
Connecting the facility with the online stores is done automatically by means of a WMS. Easy WMS, the WMS from Mecalux, features the Marketplaces & Ecommerce Platforms Integration module, a functionality that syncs the online catalogue with the physical warehouse.
This module is used by Global Freaks, an ecommerce retailer specialising in action figures, to link its warehouses with the marketplaces where it sells its merchandise: eBay, Amazon and PrestaShop.
5. Unify multichannel inventory under an omnichannel model
Ecommerce retailers that operate in several channels provide omnichannel logistics services. In other words, they offer consumers the possibility of combining multiple means to communicate with the company, such as the physical store, cell phone or website.
The omnichannel boom affects all warehouse operations because it involves a high number of SKUs and orders. Against this backdrop, managing inventory properly through technology prevents delays and mistakes.
Mecalux features several solutions that enable companies to provide advanced omnichannel logistics services. These include the WMS for Ecommerce, Multi Carrier Shipping Software and Store Fulfillment modules.
Ecommerce inventory management: a make-or-break operation
Inventory management is a crucial operation for any ecommerce company. Businesses pay a heavy price for errors and delays: customer dissatisfaction. Managing inventory effectively with the help of technology allows organisations to prepare a multitude of orders in the shortest possible time and to guarantee delivery times in order to provide quality service.
At Mecalux, we have extensive experience equipping ecommerce warehouses with storage and management solutions. With Easy WMS, ecommerce companies can monitor the status of their stock and optimise all operations, including order picking. Be sure to get in touch. We’d be happy to help you find the most suitable solution for your business.