Improving your inventory management capabilities is one of the best investments you can spend your time and money to grow your business. Brand building, marketing, and PPC optimization efforts won’t matter if you run out of stock!
Check out 10 Inventory Management valuable lessons that they learned the hard way:
Lesson #1 – Negotiate emergency measures with your suppliers
Unless you manufacture your own products (which is rare), you deal with a supplier or manufacturer. Starting with that relationship should be your first step when it comes to avoiding being out of stock.
Lesson | #2 – Better Inventory Management
The answer to avoiding stock outs and managing inventory better as a whole is to get better at monitoring your inventory and forecasting your needs accurately.
Lesson #3 – Understand your Lead Time
This is the amount of time it takes from placing an order with your supplier to your product is available at Amazon. What is the worst case scenario in terms of days?
Lesson #4 – Get to Know Your Sales Velocity, History, and Cycles
Knowing when the hot and cold times are for you will make it easier to recognize when you need to stock up on extra and when you can relax on your inventory a little bit.
Lesson #5 – Safety Stock
There isn’t really a hard and fast rule about how much safety stock to keep. But, if I’m calculating it manually I typically want enough safety stock to cover half of the lead time.
Read an article about Healthy Inventory Management on Amazon Services.
Lesson #6 – Be prepared for Emergency Situations
What happens when you run out of stock? Amazon takes your product out of search results if you’re the only seller for that particular page and a visit to your page will show the stock as unavailable. Instead, customers will buy from competitors who have stock available.
Lesson #7 – Consolidate your channel sales
One of the most important goals for e-commerce sellers is to be able to have multiple sales channels, so you can lower your risks. That is why Top Sellers invest in opening up their own online store and driving traffic and business through it.
Lesson #8 – Selling Globally
When selling globally you have to make sure you have your orders and inventory in place for every one of the locations that you are selling to. In addition, you have to count with a Global Payment Solution like SellersFX to help you get paid and pay your suppliers faster, from your online bank account.
Lesson #9 – Insurance
A lot of unexpected bad things can happen and, for a lot of them, you can get an insurance. So do your assessment and check how much and how you can get insurance.
Lesson #10 – Funding Solution
When sales start to pick-up, you really need a good amount of capital to actually be able to keep up with the growth.
Download now the full guide with what some of the TOP E-COMMERCE SELLERS shared about their experiences with Inventory Management and Business Strategy.