How to manage your inventory in Shopify?
Over 800,000 stores are available on Shopify – one of the top e-commerce platforms globally, over 200 million online shoppers are visiting Shopify-powered stores and the platform recently reached $100 billion in sales.
If your online store, your buyers, and your revenue are included in the numbers mentioned above, we have a comprehensive guide for you on everything about Shopify inventory management. Why is it crucial for your Shopify stock forecast, how to organize the control process successfully and what tool to use for the maximum growth of your store? Find answers in the sections below.
Why your Shopify inventory tracking is so important?
#1 Your customers won’t place orders for items that are out of stock – When online buyers place orders and you don’t know that 0 items are left of that particular size/color/, chances are your customers will pay for items you can’t ship immediately.
Your customer is sure that his order is placed but actually it’s out of stock. So what are you going to do? You will inform them that they will have to wait longer than expected or ship similar – wrong – item, increasing the possibility of returns and disappointment. But when you track your stock, you will know exactly how many items are available and will meet customer demand without trouble.
#2 You won’t wind up maintaining too many or too few goods – You might think that too many goods is perfect – you don’t sell fast-spoiling products and you can stock as many items as you can. But you should acknowledge that more items require more warehouse space, more shelves – both implying additional expenses. And what if you never sell those products because of low demand or changes in your range of goods?
Too few is equally unacceptable. Just because it directly affects your revenue in a negative way, forcing you to miss a potential sale. Fill rate is the metric that shows how well you manage your stock and how well you satisfy customer demand.
#3 You will be able to reveal your best and worst sellers quickly and correctly – When you are a small business, it’s relatively easy to find out which products are in highest demand because your customers place only a few orders. Once you start growing, only proper tracking can help you identify your top items.
#4 Your stock will stay organized and your employees will find the necessary items easily – It is always great when your warehouse space is neat and every item is in its place. It is a sign of unproductivity when your warehouse employees can’t find the ordered item and don’t have a proper understanding of where to look for it.
#5 You will know when is the right time to contact your suppliers and replenish sold-out products – Inventory tracking is not only about store owner-customer relationship, it also regulates the communication between you and your suppliers. When to order, which items and in what quantity – this is the information you definitely need to know precisely and this is where your Shopify stock prediction becomes a necessity.
#6 You will avoid customer dissatisfaction cases because of failing to ship on time or delivering the wrong items – If you don’t have the ordered item at hand and can’t ship immediately, chances are extremely high that you will receive negative emails and reviews. Especially if that item is a gift or an expensive product. If you put your customers in a difficult situation, it’s always hard to rebuild their trust again.
#7 You will eliminate financial losses that were stemming from lost & damaged products or high-demand but sold-out goods – Yes, financial losses are at the root of every point we mentioned and all your efforts should be directed at minimizing and even eliminating them. When you track, you save. When you save, you earn.
Spreadsheet vs Shopify inventory management software: Why to choose the second option?
When large store owners realized the power of inventory tracking, Google docs and Microsoft Office were the most popular places to create spreadsheets. Because they are free, they are online (no physical papers) and analyze the data automatically, providing you with necessary statistics.
As the SaaS industry evolved, data entry and management became more sophisticated with even more advanced inventory management tools. That was because Google and Microsoft spreadsheets can be utilized by various industries – from accounting to healthcare and education and consequently, they don’t take into account the nuances of separate niches.
Besides being too generic, spreadsheets may create other difficulties and result in more serious issues too:
Issue #1 Math knowledge
You need at least basic-intermediate math knowledge to work with Excel formulas. Even if it’s not a problem for you personally, it can create difficulties for your employees who are not math specialists.
Issue #2 Fraud risk
You will have a hard time controlling who is applying changes to the information in your spreadsheet and in case of critical errors, you won’t be able to find the one who will bear the responsibility.
Issue #3 Error risk
While working on spreadsheets, you and your employees can’t do without manual actions, including copy & paste, moving data from one cell to another, editing data. The more manual intervention, the higher the chance of making a mistake.
Issue #4 Loss riskJust one click on Delete and you will never see your doc again. Whether it’s intentional or by chance, there’s a high risk of losing your doc with all the vital information inside it.
Issue #5 More spreadsheets, more confusion
Imagine you start offering new products on your Shopify store and sell not only shoes but accessories too, like bags, scarves, and sunglasses. You will need at least 4 different docs and go from one to another every time you need to check info or have to make edits.
Issue #6 Low level of data protection
Copying the information from your doc is extremely easy. And you can’t control who is having access to what type of information. The doc is open to those who have access. Your sensitive data easily can become available to people who shouldn’t learn it at all.
Issue #7 Waste of time Excel requires entering formulas every time with the manual process. And if your team member forgets to update the formula, you will end up having miscalculated results.
Issue #8 Complex interface
As we mentioned in the intro part of this section, Google docs and Excel-Word sheets are non-specific and can be used for data analysis in any industry. Consequently, there are formulas, options, and sections that you will never use but you will come up with them every time you work on those docs.
With Shopify inventory management software, you make your online store management task 8x times more facile, productive, and precise. You will be working with a tool that is designed for a certain purpose, has a user-friendly interface, and is easy-to-use.
6 benefits of using a Shopify inventory management software
Nobody says that you are unable to track your inventory via Shopify itself. What we say is that you can subscribe to more sophisticated software which instantly integrates with your Shopify store. Why so?
#1 Separate software is using a more innovative forecasting engine and leverages the best practices of machine learning technology. So you will have more accurate and reliable data to rest upon.
#2 If you sell or once you start selling several variations of a single product or several categories of products, Shopify inventory management system can gather all your data under one umbrella and analyze it easily.
#3 Your data can recommend you for which products you can run marketing campaigns, offer promotions and discount so you sell them more effectively.
#4 Your software will tell you which are your top and worst-selling products, what you should order from your suppliers and how much, how is the replenishment process going, etc.
#5 You will be able to set up SKU numbers and track all the items in your stock one by one.
#6 You will know how many sales and how much revenue to anticipate in the upcoming months.
Shopify stock forecast made easy: What solutions to expect from Intuendi?
With Intuendi, everything from your inventory to budget and sales is under control. You can handle your promotions, stockouts, and sales expectations, export your Shopify forecast and purchase orders instantly and do much more. Our main solutions include:
- Demand Forecasting
- Sales Forecasting
- Inventory Optimization
- Budget Optimization
- New Product Forecasting
- Inventory Replenishment
- Purchase Orders
- Omni-channel Demand Planning
We tried to cover inventory management topic with all its basics and nuances so you become even more confident in your decision to track your Shopify stock properly. If you have more questions, you can visit our FAQ section or contact our team.