As a business grows, one of the biggest challenges faced by online retailers is the effective management of their inventories, orders, sales and deliveries.
Thankfully, there are ways around this.
Inventory management software enables sellers to take full control of their business operations and have complete oversight of their stock. In fact, there are many benefits to using such a system so that you can concentrate on growing your business.
But what exactly is inventory management software? What can it achieve? And, what are the benefits to using an inventory management system?
In this article, we gloss over what inventory management software is and discuss several benefits and functions of using such a system to support your eCommerce business.
What is inventory management software?
Inventory management software is a digital system that enables businesses of all sizes to track inventory levels, orders, sales and deliveries.
But it also does so much more than this.
Most modern inventory systems will connect and automate all the different parts of the selling process, so that you can increase your day-to-day business efficiency and have more time to focus on growing your business.
Typically, inventory management software is used to avoid both product overstock and stock outs and users of such a system benefit from total control over their inventories.
Another common use for an inventory and order management system is to reduce the risk of overselling. Modern software systems are able to synchronise product data across all your selling channels and can update inventory stock levels automatically.
With an inventory management system in place, you’ll benefit from having full control over your inventory regardless of where you sell and how many channels you sell on.
What can inventory management software do?
Automate tasks and increase business efficiency
Although you’ll likely already have an inkling of this, the best inventory management systems will automate many of your daily tasks and simplify many more.
There’s no need to spend time tracking your inventory manually, so you can concentrate on the more important elements, such as growing your business.
Automation of day-to-day tasks will also eliminate the risk of human error and save on the countless hours that manual inventory management brings.
You can speed up your order processing by automating everything from order creation to label printing, right through to warehouse management and order fulfilment.
Identify trends and forecasting
Inventory management software can analyse the patterns and rates at which you buy and sell inventory – even including things you hadn’t thought to consider – and tell you how much to purchase and when.
This helps to prevent some frequent mistakes related to running a business, such as not having enough products in stock or ordering more than your warehouse can hold.
As inventory management software enables you to reorder items before they become fully sold out, you can rest assured that you will always have stock to sell to your customers.
Reduce the risk of overselling
For many businesses, one important element of an inventory management system is that it greatly reduces the risk of overselling.
The software system synchronises your inventory across all of your selling channels (e.g. online marketplaces and eCommerce platforms) and makes use of automatic inventory updates so that you don’t oversell your products.
By automating your inventory control, businesses have a better view on their operations and are less likely to experience overselling, overstock, and product outages.
This will result in fewer financial losses and strengthen the reputation of your company because you are able to provide a better service to your customers.
Still not convinced? See for yourself how online retailer, Rinkit, used inventory software to put a stop to overselling and expand their business internationally.
Reporting tools to make better business decisions
Through analysing your sales data and identifying your top performing channels, products and markets, you can make better business decisions and increase your profitability.
Analysing historical sales data enables you to identify customer buying patterns and seasonal trends, so that you can better anticipate increases in stock demand and prepare your business accordingly.
Some inventory management systems allow online sellers to see the stock consumption for any item in any given time period.
Such software enables you to understand the amount of stock you have available, the value of the stock and the amount you’ve sold to help you make informed decisions to increase the profitability of your business.
Take a look at these inventory metrics you should be tracking for business growth.
Maintain high levels of customer satisfaction
Inventory management software greatly reduces your time to fulfilment.
With such a system, you can keep fast-selling products in stock and fulfil orders immediately. The quicker you can fulfil your orders, the happier your customers will be.
What’s more, modern systems can help to analyse historical data so that you can make accurate forecasts for future stock levels and prevent costly stock-outs that may cause customers to look elsewhere, such as with a competitor.
And that’s not all.
Thanks to the reporting tools of inventory management systems, you can be attuned to the needs of your customers and be able to react accordingly. You can also find patterns in demand that can help to drive successful sales and marketing strategies.
Effective inventory management grows your business
The bottom line is that the best inventory management systems out there will help you to grow your business exponentially.
Through automation and the right inventory management techniques, you can free up plenty of time that can be spent on more important elements, such as growing your business.
Do you have a burning question about inventory management software or what it can do? Drop us a comment in the section below and one of our team will get back to you.
Looking to grow your business even further? Take a look at these 50 ways to grow your business and take your retail company to the next level.