Amazon inventory management system
- Being an Amazon seller is a perfect way to make money.
- Amazon is one of the best and largest online marketplaces in the retail world.
- Amazon gives you a potential audience to sell, giving you a lucrative opportunity to increase your profit each year.
- Selling on Amazon really differs from selling on other marketplaces.
To become a successful Amazon seller, first of all, you should realize the importance of strong control over your inventory. It is the number one precondition of making a revenue.
Managing your inventory seems a simple task if you have just started selling. But as your orders start increasing, you won’t be able to overcome the challenge.
Some sellers are still inclined to manage the inventory manually. But after some time, they will realize it has become a really awful headache for them.
In these times of technological innovations, there is a fantastic solution-inventory management system.
This article will discuss the essence of the inventory management platform and the main features and characteristics of the inventory, and any detail you need to know.
What is an inventory?
Inventory refers to goods that your company keeps on hand for future selling, including raw materials, products, or even software.
Types of inventory
There are different types of inventory, depending on what you sell. Below you will find all the types of inventory:
- Raw materials: The inventory for making finished goods
- Work-in-progress: Unfinished goods, that is, inventory that is still in the manufacturing process
- Finished goods/goods for sale: The products ready to be sold to customers
- MRO goods: MRO refers to Maintenance, Repair, and Operating. This is inventory supporting the manufacturing process.
- Safety stock: The inventory in storage any supplier shortages or high demand situation
The inventory management platform is a well-carried system that comes to handle your inventory and order management processes improving your Amazon sales performance.
Moreover, it will help you reduce your carrying cost, alleviate fees, and keep inventory real-time updated across all your channels.
One other advantage of this system is time-saving opportunities. It will allow you to focus on more important fields of your business.
As you can see, accurate inventory management is essential for a healthy business lifecycle.
Having proper inventory management is crucial if you want to use Amazon FBA (Amazon Fulfillment Services). Because for Amazon FBA, it is a must to keep enough inventory levels at your distribution centers to ensure, on the one hand, on-time order fulfillment and, on the other hand, do not pay waste storage fees for excess inventory.
Inventory management software will enable you to sell on different sales channels simultaneously without any difficulty and human mistakes.
Today’s market offers a wide variety of software with valuable features and capabilities to choose from.
Keeping accuracy is possible via robust inventory management software.
I do not want to try your patience and speak about the main benefits of using an inventory management system.
The inventory management process has five key stages.
The inventory management process refers to tracking and controlling inventory while moving from suppliers to your warehouse and customers. Generally, there are five main stages in inventory management:
- Purchasing: Buying raw materials to turn them into products or buying products to sell on with no assembly required
- Production: Making finished products. But not all companies act in manufacturing, for example, wholesalers.
- Holding stock: Stored raw materials and finished goods before they are used or sold
- Sales: Sending your inventory to customers and get paid
- Reporting: Insights showing how much you are selling and how much money you make
Benefits of an inventory management system
Reducing inaccuracies
Managing your inventory is not merely the process of controlling your stocks but also a group of other internal functions. Consequently, implementing these tasks manually may cause inaccuracies and mistakes, including missing data or data duplicity.
As you start to invest in an inventory management system, you will get rid of manual data entry and save more time.
Boost productivity
Inventory management systems allow you to get insights into your sales. Accurate analytics and reporting can enable you to find better sold or dead stock products. Transparent sales details help you to forecast future sales and make final decisions based on actual statistics.
Happy customers
Proper stock management impacts your customers’ satisfaction level too. With this methodology, you will meet all your customers’ requirements and make them come back and become permanent buyers. Be sure your business’ name and loyalty depend on your inventory accuracy.
Get rid of manual work.
Everything done manually is inclined to have mistakes. In other words, these are known as human errors. That’s why instead of hundreds of workers, business owners decided to use automated inventory management software to save money, time, and effort. Finally, this will really improve productivity and quality. Inventory management systems can handle any task with high-accuracy and efficiency.
Improve performance
Using an inventory management system allows you to streamline your stocking process with high accuracy reducing costs and increasing profit, excluding stock expenses caused by human mistakes, and getting your sold product insights to manage your inventory and make restocking wisely.
Moreover, you can avoid out-of-stock and overstocking situations and stop inefficient inventory management.
Let’s imagine a simple example.
You have a toy shop. One of your customers asks you to give him a car he wants. You look for and understand that it is not available at that moment. As a final result, you lose your potential customer. It is the worst thing you want.
Thus, if you do not want this to happen, rely on inventory management software. It will always send you notifications informing a particular product is about to be out-of-stock.
Data Security
With the inventory management system, you can choose from existing permission levels and give each special user permission. This will allow you to maintain high security of data and exclude information flow at all levels.
Maximize Profit
Any business owner wants to improve its business profitability. Sometimes even a single improvement can bring massive changes. That’s why investing in an inventory management system can help you manage your costs and boost your benefit ability. What is most important is the quality of your products and services won’t suffer.
Disadvantages of Inventory Management Software
While there are many advantages of using automated inventory management software, there are several disadvantages too.
The main disadvantage is unexpected technical issues and system crashes, causing loss of data and break of the whole operational system. It is the worst thing to be unable to access the needed data to run your business.
The second problem is missing manual audits and reduced human interaction. Of course, it is excellent that there is no more need for manual tasks and physical audits. However, physical audits are still crucial for highly effective business management. Only manual audits allow business owners to find out any manipulation happening in those automated systems.
But these are no matters to avoid using computerized inventory management systems. Generally, all the situations listed above are rarely happening.
Automated inventory and order management software must boost operational effectiveness, minimize inventory costs, and ensure on-time order fulfillment.
Choosing the right inventory management software for Amazon is too vital, particularly if you have poor management skills.
Luckily, there are many eCommerce tools to meet your requirements. Choosing the right software will help you manage your inventory, manage orders across various sales channels, create shipping labels, print and send invoices and ship them to your customers.
Grow your business in 2021.
