20th June 2017
5 Minute Read
Whether multi-channel selling drives your growth in sales volumes or is necessitated by it, positioning your stock in more than one outlet will be inevitable. Whether you are selling on the highstreet, through a webstore, through an online marketplace like Amazon or eBay, on or all of the above, properly managing inventory across all of your sales channels can be the key to your success.
Effective inventory management is important for a number of reasons:
- Stock is often your biggest single asset and consumer of cash
- Too much stock is a drain on financial resources
- The wrong stock results in resources being tied up longer or worse price cuts, reduced profits or losses
- Exposing all of your stock on every sales channel risks oversells and damaging negative feedback from disappointed customers
- Splitting stock across sales channels exposes you to losing larger orders that you apparently can’t fulfill.
We’ve compiled our top 5 tips for stock management to help keep your inventory off the shelves and get it into the hands of your customers:
1. View Your Stock as Your Greatest Asset and Your Number One Liability
If you look at it this way, it will maintain your focus. Stock management should be a daily priority. Pay particular attention to fast and slow movers ensuring that you predict demand and ensure stock replenishment from suppliers for the former to avoid running out of stock and losing sales. For the latter consider taking prompt action on price or bundling (see below).
Use watchers as an indication of demand and monitor the ratio of watchers to orders as an indication of the attractiveness of your offer. Improvements may rapidly trigger increased order volumes so you need to ensure you have stock to cover this.
Properly managing your inventory is key in identifying ways to improve your cash flow. Focusing on ways to influence smarter buying decisions and improving forecasting are critical. Several cloud software solutions exist to help with stock management as a back office process but solutions like ChannelGrabber are incredibly useful for multi-channel stock management and POS.
2. You May Have Lots of Stock Items But You Only Have One Inventory
Multi-channel selling offers merchants many ways to market and sell their merchandise to customers and it offers customers a choice of retail outlets to buy from. But unless you sell on the high street, your stock doesn't have to be shared across your sales channels. This practice is common and borne out of the fear of overselling.
Imagine that you had 30 items in inventory and three sales channels. If you present your entire inventory through all three sales channels you risk overselling by as much as 3X your inventory level, disappointing customers and impacting your seller ratings. But if you present 10 items in each of the three sales channels, there’s no way one customer can order more than 10 items from any sales channel and therefore no way that you can oversell.
Equally though, any customer wanting to buy more than 10 items will likely look elsewhere to buy them and will usually choose the retailer with apparently more physical stock.
You have to view your inventory as one and make it available to all through every channel but to do this you must engage in real-time stock management. Every time you sell an item, the stock level has to change in every sales channel in real time. This is relatively easy to do if your sales volumes are low, sales are few and far between or if you have only a couple of sales channels to manage but as your business grows, you need to consider using software solutions to manage this time consuming process automatically.
3. Learn from the Past – Analyse your Order History
Understanding what you have sold, when and where is not only critical for predictive stock management but it will also help you to maximize future sales.
Developing a detailed and dynamic understanding what products are your top sellers and slow-movers, assessing the impact of changing descriptions, images and pricing on sales volumes and knowing which sales channels are most and least effective at selling those products are all key to increasing sales and better managing your procurement and inventory.
Monitoring trends and drawing on historical analysis to predict factors like seasonality are also critical for planning and sales forecasting and again these are all best achieved using software that both captures and reports upon this data.
4. Up-sell and cross-sell
Help your customer to find products that make ideal bundled purchases by presenting them in your online store in exactly the same way you would in a high street store. Upselling and cross-selling are great ways to maximise cart value. Design your webstore with bundle merchandising in mind and manage your physical stock in the same way by making sure your stock room is just as well organised for quick picking, packing and shipping.
5. If at First You Don’t Succeed…
If applying upsell and cross-selling tactics don’t help with those slow-moving lines, then don’t fear. There is still the voucher or coupon approach. This only works on your webstore or with marketplaces that support it but following up a sales with an SMS or email containing a promotional code for items you want to move can be very successful. A well timed modest discount on a suggested bundle item can be a great way of influencing a last-minute change of heart and a return to your store to make a further purchase.
If you sell through multiple sales channels, stock management can be a huge chore and an enormous administrative burden. Many take short cuts in an attempt to overcome the challenges of manual stock management but these can leave dissatisfied customers or cause lost sales. Automation can address manay or all of these challenges and lead to smarter, more efficient stock management and increased sales.
And don't forget, ChannelGrabber's multi-channel ecommerce software helps you to automate the management of listings, stock, orders, billing, shipping and messaging so frees up your time to focus on keeping inventory off the shelves and into the hands of your customers.