If you’re in the E-commerce world, you know that having an effective inventory management system is half the game. Failing to properly predict, order, and organize your inventory makes it incredibly hard to facilitate smooth operations and a seamless customer experience.
At the same time, you also know that being a successful online retailer means juggling dozens (if not hundreds) of tasks at the same time. Finding the space to oversee E-commerce inventory management and develop the right skills can be challenging, if not impossible.
As a result, many E-commerce businesses choose to outsource their inventory management to professionals who are operational experts. For many online retailers, it’s not so much a question of if they will hire inventory specialists, but when.
That’s what we’re talking about today on the Design Staff blog. How do you know when you’ve reached the inventory system tipping point? When is the “right” time to outsource your E-commerce inventory management?
Here are a few dead giveaways that the answer is “now.”
1. Your Online Business Is Growing – Rapidly
Ultimately, your goal is to grow and scale your online business. Fortunately, it’s estimated that retail E-commerce sales orders worldwide will increase by at least 8.9% in 2023, so growth is a high possibility in the coming year.
Of course, when your retail business booms, so do your inventory needs. As you acquire new customers and receive more sales orders, you’ll need to…
- Manage a larger product range
- Handle the flux of seasonal sales orders
- Prevent frequent stockouts or unsold inventory
- Implement better tracking systems
- Generate accurate inventory counts
- Learn to predict customer demands
If you’re seeing substantial growth in your E-commerce business, it’s time to focus on scalability – and that likely involves finding inventory management solutions. You need people in your corner who can proactively plan for growth and ensure you’re stocking all of the right products at the right time.
You invest the bulk of your capital in inventory. Handling inventory management with spreadsheets and paper may have worked a few years ago, but if you’re growing, you’ll need a better (more effective) way to track your inventory data.
Find an E-commerce inventory management team with experience implementing scalable systems, optimizing processes, and accommodating growth. Not only will they help keep your inventory organized, but they’ll also help you identify further opportunities for expansion.
2. You’ve Got a Complex Supply Chain
If you’re experiencing success as an E-commerce retailer, chances are you’ve weaved a pretty intricate network of activities, processes, and stakeholders throughout your production and distribution system.
This complex supply chain can be a real headache, especially if your business involves multiple suppliers or drop-shipping arrangements.
As a retail business owner, you don’t necessarily have the time or experience to oversee complex supply chain management. That’s why hiring good inventory management services might be the best move (before things get even more complicated).
An E-commerce inventory management team will analyze your entire supply chain, then map out its various components, including all of your…
- Suppliers and manufacturers
- Distributors
- Logistic providers
In doing so, professional inventory management will be able to identify bottlenecks and inefficiencies that are holding your E-commerce business back. They will also tend to the majority of your supply chain relationships, negotiating favorable terms and ensuring everything flows as it should.
At the end of the day, your team needs to be focused on overall business operations. If you’re dedicating too much time to managing an overly complicated inventory system and supply chain, it’s likely time to outsource.
3. You Need Better Inventory Forecasting
Even if you know your company and its products backward and forward, no E-commerce business owner has a crystal ball. In fact, professional inventory management is about as close as you can get to predicting the future.
How much inventory do you need for the holiday season? When is your slow season? How will shortages of raw materials affect consumer demand?
That’s inventory forecasting, and it tends to require a professional touch. An experienced team will focus on maintaining optimal inventory levels to prevent stockouts, missed sales, and most importantly, the loss of customer satisfaction.
Efficient E-commerce inventory management also reduces the costs associated with excess inventory and stockouts. When a professional inventory manager can accurately analyze demand patterns, they can then implement forecasting techniques and establish automatic reorder points.
In short, expert inventory forecasting prevents your business from tying up capital in unsold inventory while ensuring sufficient stock is available to meet customer demand.
4. You Want to Streamline Your Warehouse Operations
Do you operate one or multiple warehouses for your E-commerce business? Then strategic inventory management is even more critical. Every detail, from the building’s layout to your packing processes, plays a role in the overall success of your business.
An inventory management expert will help you…
- Design and implement a more organized warehouse layout
- Establish efficient picking and packing processes
- Adopt inventory and sales tracking technologies
- Minimize human error in order fulfillment and shipping management
- Ensure inventory accuracy and quick replenishment
- Generate automatic reorder points and low-stock alerts
Improving your warehouse operations isn’t just about speeding things up or easily tracking inventory – it’s about finding ways to continuously improve and save money. When you’ve got an inventory management expert in your pocket, you’ll stand a better chance of eliminating waste and reducing your inventory costs.
5. You’re Ready to Upgrade Your Tech
Lastly, the E-commerce inventory management pros are up to date on the latest technologies, including the software solutions that could transform your day-to-day operations. As online shopping continues to evolve, so do the inventory management software and tools.
Already, the use of drones in warehouses has increased by 70% in the past three years, with many businesses using them for E-commerce inventory management. Additionally, more than 75% of warehouses now use some form of automation technology, such as robotic pickers and automated inventory tracking systems.
Although you could dive into the world of inventory management software and tech on your own, doing so can be time-consuming and overwhelming. In most cases, it pays to work with a professional who knows exactly what inventory management tools you need.
In Summary
While solo inventory control might be feasible in the early days, you’ll likely hit a tipping point. When the complexity and demands of inventory management escalate, it’s a good idea to reassess your inventory management system.
If any part of this blog post rings a bell, from fast-paced growth to a need for better technology, now’s likely the time to up your game. Don’t wait until things have gotten out of hand to find an E-commerce inventory management solution.
Similarly, don’t wait to outsource the digital side of things if you’re feeling stretched thin. E-commerce web tactics are always evolving, and keeping up is critical if you want to keep up with your industry’s sales trends.
Need help with web design or development for your E-commerce business? Shoot us a message at Design Staff. We’ll create dedicated to creating timeless websites for online retailers.
