Effective inventory management in a multi-channel environment: Assessing your capabilities

Sometimes the excitement is just too much. You have a new eCommerce system and you just can't wait to start selling products online.  The opportunity is great and your expectations are high, but do yourself a favor - wait until you have everything in place before you "open" your new store. One of the most commonly neglected parts of running a profitable eCommerce strategy is inventory management. Without it you risk:

• Not having enough product, disappointing customers and hurting sales
• Carrying too much inventory and tying up cash that could be used elsewhere

The pain of a manual inventory tracking system

A typical manual inventory scenario evolves like this:

Company A has a physical store and then adds an online store. They do well processing orders and managing inventory manually while fulfilling from the physical store. But as their business grows, they decide to add an online marketplace like eBay or Amazon. Suddenly multiple locations are pulling from inventory. They try to keep track manually but the task is nearly impossible to maintain. In some cases, they spend 5-6 hours a day just tracking inventory! Not only is this time consuming, but inventory information is delayed, no one knows the real inventory count at any given point in time, and channels begin to sell items that aren't in stock. Customers become angry and orders are canceled. In this age of social media and customer reviews, Company A panics as its reputation becomes tarnished.

Don't become Company A! We have found that regardless of the sales channel you start with (a physical store, an online store, marketplace, etc.) the story always ends the same once multiple sales channels are added ...