How Inventory Automation Benefits eCommerce Merchants

What Is Inventory Automation?

Inventory automation enables eCommerce merchants to create a frictionless back end experience for employees and front end experience for customers. Inventory automation, or inventory management, is when businesses use software to manage SKUs in their warehouse in real time. Automating the management of inventory makes it easier for businesses to process and fulfill customer orders, manage data critical for warehouse operations and track inventory levels.

In this blog, we’re going over the several challenges that eCommerce merchants face when it comes to keeping track of inventory and discussing how automating the inventory management process solves these problems.

Avoid Overstocking & Overselling

eCommerce merchants who don’t fine tune their inventory levels or have a refined understanding of their customers’ shopping habits tend to experience overstocking and overselling. Overstocking is when businesses overestimate how many products they need to have on hand to accommodate customer orders. Overselling, on the other hand, is when businesses allow customers to place orders when the company is unable to fulfill the demand for a product.

Though it’s smart to have ample inventory on hand, it can be expensive to store your products, especially if you have too many products that you’re unable to sell. This extra inventory that’s difficult to sell is increased when food and perishable goods expire over time, making them impossible to sell safely. It doesn’t only occur with merchants selling perishables, though. Overstocking also happens when customer shopping habits change and new trends come about. However, if your company is utilizing dropshipping, you don’t need to worry about this overhead.

Manage Bulk Orders

Whether you’re a D2C apparel store or a B2B merchant selling online, keeping track of hundreds of SKUs in the back end isn’t easy. You may need to purchase a few hundred or  thousand units of a new trendy sweater to then sell to your customers, or you may need to order 2,000 drywall panels from a B2B wholesaler.

In the first circumstance with the apparel, the merchant must ensure that they’re accurately managing the inventory levels for the sweater SKU that they have on hand to ensure they don’t sell something on the front end that isn’t available in the back end. The same applies in the second circumstance with the drywall panels; however it’s more complex. The wholesaler must make sure that those 2,000 panels are ready to be picked up or shipped out on the first day of each month or the date that was outlined in the contract. They must also make sure that once the stock level hits 2,000, nobody else is able to purchase drywall panels. From a B2B standpoint, the management of inventory has the potential to become very chaotic if not managed properly.

Leverage Inventory Rules On Your Website

Regardless of whether you sell to consumers or to other businesses, your website should always display accurate information when it comes to inventory availability. Informing website visitors when a product is out of stock 一 rather than not making them aware and allowing them to order it even though it’s unavailable in the back end 一 prevents customer confusion and dissatisfaction with your brand. In addition to informing customers when a product is out of stock, we recommend optimizing your website functionality further by using back in stock automation. Giving customers the option to sign up with their email address and get notified when the product is available again on your website is a great way to satisfy the customers that were too late to purchase the first time around.

When one of our clients, who sells a wide range of products, experienced constant changing of inventory, they wanted clarity that their new BigCommerce website would have the ability for customers to backorder. The solution involved utilizing inventory rules to ensure that the products displayed on the front end of their website matched the availability of the SKUs in the back end in the warehouse. To read how the Groove Commerce team implemented the solution, check out how we built their BigCommerce website in this case study.

Track Inventory Across Multiple Channels

Luckily for eCommerce businesses, there are quite a few inventory automation solutions that integrate seamlessly with eCommerce frameworks. An Enterprise Resource Planning (ERP) integration or a Product Inventory Management (PIM) integration may be necessary depending upon how your business operates. These two softwares enable merchants to track their inventory across various channels, so they can see from within one dashboard the date at which new products will arrive, the number of units for each SKU that they have on hand and even the products that have been shipped.

Conclusion

Inventory automation really helps to create a frictionless inventory management experience. When inventory is presented accurately on an eCommerce website, customers are able to place their order and businesses are able to fulfill the order with zero obstacles.

Want to learn more about how our team helps mid market and Enterprise eCommerce merchants manage their inventory? Check out how we helped a B2B athletic clothing manufacturer use an ERP system to help keep track of their inventory and orders. If you have questions or want to learn more about how Groove Commerce can partner with your business to build, design and grow your eCommerce store, don’t hesitate to reach out through the form below.