E-commerce Inventory Management Offers a New Business Opportunity to Many
January 1, 2021
Pandemic spread has redefined the way people buy products or services. Shopping is done online and is considered safe following all the rules of social distancing and no touching. Customers have switched from shops and malls to online shopping platforms to shop for basic necessities and luxury items. This has bought a revolutionary change in the e-commerce sales this year. E-commerce has given people a privilege to buy products at just a click and get delivered at doorstep.
According to IBEF, the market opportunities for online commerce in India are expected to touch $200 billion by 2026 from $30 billion in 2017. The report also states that the Indian e-commerce industry is expected to overtake its US counterpart to become the second-largest market for e-commerce in the world by 2034. Business data platform Statista stated that the consumer retail segment is expected to see an increase in losses ranging from 3-23%, depending on the market. The report even included that the average retail e-commerce revenue per user in the nation was $50 as of 2018, and is expected to go up till $75 by 2024.
E-commerce business – The ‘new normal’ Thanks to the advancement of technology, e-commerce business is becoming easier by the day where businesses can identify and profile complicated orders with an ease, block fraudulent orders, increase profitability by tracking down and curbing additional losses before shipping, pre-payment options for Covid Safety, etc. One of the complexities of e-commerce business is about managing a huge inventory. E-commerce business is like an iceberg, looks nice and easy on the top has a whole lot of organizing the product supply chain below. With inventory management in place, this complexity is also taken care of.
What is E-commerce Inventory Management?
As the e-commerce business grows, partnering with more manufacturers and warehouses in order to meet the growing demands of your customers becomes a necessity. Having an inventory on hand and accessible when demand suddenly increases should be a precautionary step a business owner to ponder about. But again, without inventory management software in place, trying to keep track of orders, inventory, and relationships across all warehouses, partners, and manufacturers can be a challenging process for anyone.
E-commerce inventory management is the act of measuring the amount, location, pricing, and mix of products available from your business. These could be products hosted in your own warehouse, provided through a third-party logistics fulfillment center (3PL), or housed in a separate business and purchased through drop-shipping. Through eCommerce inventory management, businesses know what products are overstocked, in stock, under stocked and out of stock.
Inventory management is closely tied to a company’s financials. In any given large warehouse, correct control over inventory gives you a birds-eye view of the amount of revenue potential from every single pallet. From there, businesses can make more informed decisions around other strategies – like marketing – and adjust the demand for future storage or warehousing. Managing inventory is a more efficient business practice where it can keep an eye on the entire stock, eliminate dead stock, give an insight to the customer whether the item is in stock and also ease up the process of cross border shipping. It’s a win-win situation for all.
Technological Advancement in Inventory Management
Various softwares have been developed to keep a strict watch on inventory where if a product gets purchased on one channel, the inventory numbers need to match across all channels. Inventory management software, paired with accurate channel management, helps brands achieve this. Some examples of effective manual inventory management methods include:
- Using online spreadsheets to track inventory numbers
- Using a suite of separate tools that are integrated or synced with each other
- Using an online program that can provide you with automatic real-time updates
- Using softwares to manually track and fulfill orders
- With a centralized system that pulls inventory information from every source on a real-time, 24/7 basis, one can virtually leverage data insights for future growth
Enterprise brands and businesses with a large catalog of SKUs (Stock Keeping Unit) can cut down on costs and corner the marketplace with an effective handle on their inventory management. The front- and back-end experience for any purchase should always be optimized to satisfy the end customer – which is where Big Commerce enters the game. Besides e-commerce business, creating softwares for inventory management or managing inventory is also a brilliant business opportunity in this era of digitization.