Accurate tracking, measuring, and forecasting of inventory is crucial for seamless order fulfillment, financial decision-making, customer satisfaction, brand perception, and other aspects that drive the success of an ecommerce company. That is why even if your sales are through the roof, your success will be short-lived without capable inventory management. These guiding principles can help ensure that your inventory management stays successful and contributes to the growth of your business.
Inventory data is an important consideration when making logistical, purchasing, and fulfillment decisions. Inaccurate or unclear data negatively impacts these areas - so it's critical to have inventory data that is clear, accessible, and up-to-date (ideally, in real-time).
Inventory velocity is the time it takes to sell each individual item in stock. When you need to predict when inventory will need to be replenished, or decide if a product line should be liquidated, inventory velocity is a useful metric to have. It may not be tracked by your inventory management system, but it's something you should keep an eye on.
Compare your inventory management metrics with industry benchmarks on a regular basis. If your inventory performance falls behind industry averages, it’s time to reevaluate your approach to inventory management and create a plan for improvement. Outside perspective can prove invaluable in such a situation; by collaborating with the right 3PL provider, you can get the expertise required to fix issues, and even improve growth and stability.
Returning customers provide the best ROI for ecommerce companies. While there are lots of things you can do to retain customers, it’s important to remember the primary factor that influences whether a customer will continue to order from you: do you provide a good customer experience? To answer this question and make any necessary improvements, you have multiple options for assessing customer experience.
One excellent method is to become your own customer. Contact your company for help with placing an order. Buy something from yourself and evaluate your checkout process. After the order arrives, call customer service to troubleshoot some issues. Go through your returns process. Evaluate what you see from this perspective and ask yourself which areas have the highest need for change.
You can also assess your customer experience by looking at collected feedback. To start, you can analyze the latest product return codes to look for common themes (or, you can decide to implement new codes to get more granular data). If your customer service department uses call monitoring and/or complaint logging/reporting, that’s also an excellent way to find areas of the customer experience that need improvement. Finally, you can always ask your customers for constructive feedback with survey tools.
Don't forget: your competition's offerings and customer expectations are always evolving. Since it's a major competitive differentiator, it's critical to periodically assess your customer experience and make improvements where necessary.
The more retailers that you sell your products through, the more challenging it is to manage that inventory - and the costs of sub-optimal B2B inventory management can be steep. In 2015, CNBC reported that stockouts accounted for $634.1 billion in lost retail sales for the year. Those losses can easily pass on to you. If retailers are not confident in your product availability, they will find other suppliers.
Preventing stockouts with well-done B2B inventory tracking goes beyond keeping an accurate SKU count. Ideally, your inventory management software and staff should have the following capabilities.
Detailed tracking information
Your inventory feeds should provide your retailers with as much information as possible, such as:
- Available inventory by location – not only can this free your retailers from being bound to a single inventory source, it can also be useful for shipping calculations
- Restock dates – for low or out-of-stock units, provide both the amount and date by which the inventory will be replenished.
- Real-time data
Comprehensive inventory management
Go beyond the management of in-stock inventory with more proactive services, like:
- Stock alerts – actively communicate when products become out-of-stock, low stock, or back-in-stock
- Allocated stock – allocating inventory for individual retailers helps to manage their expectations is very useful for preventing stockout issues
- Internal backorder management – if it doesn’t take long for you to resupply stock, you may have the bandwidth to handle backorders on behalf of your retailers (or adjust their allocated stock accordingly)
- Shipment notifications – automated shipment notifications with delivery timeframe estimates saves retailers the trouble of calling you, and gives them the information they need to reassure their customers.
If these upgrades to your inventory tracking sound too complex, Fulfillment Works can help! Our Client Access Center technology is customizable and lets you manage all aspects of your inventory from any internet connection (including mobile devices).
Scores of entrepreneurs and new companies are entering the ecommerce industry every day. And with U.S. ecommerce sales predicted to surpass $480 billion by 2018, it’s easy to understand why so many brands are eager to start growing their ecommerce offerings. Breaking in to the biz can be easy, but success requires careful planning and strategy. To ensure growth and long-term success for your ecommerce company, focus on the development of these areas.
Ecommerce has limitless options – if you can ship it, you can sell it online. However, the sheer variety of opportunities to offer new types of products can make it challenging to effectively scale your production. Go slow, and listen to your customers. Use sales data on past purchasing trends to guide upcoming production priorities, and if necessary, get help with inventory management early in the planning process.
Order fulfillment is a critical part of providing a good customer experience. If you opt to keep your fulfillment operations in-house, consider how you can use tools and technology to keep operations transparent to customers and flexible to meet changing production needs.
Whether through emails, direct mail, or other forms of advertising, marketing is important for growing your ecommerce business. For new ideas to boost your marketing initiatives, check out the marketing tips in our blog.
Customer Service Staffing
For customer service positions, your staff can be a defining factor in the customer experience your business is known for. Give your staff the authority and flexibility to come up with novel solutions that satisfy customers, then grow the team by looking for candidates who can use their creativity and customer-empathy to make the most of that flexible environment.
Upsells are an important ecommerce tactic because they can increase customer satisfaction with an order while increasing your revenue. But, you don't want your upsells to come off as pushy or be intrusive to the user's shopping experience. As the saying goes, "you catch more flies with honey." Consider these tips when crafting the messaging for upsell opportunities.
Well-timed discount incentives
Find creative ways to grab your customers at the end or near the end of their purchase journey with various discounts. Amazon.com's "Subscribe & Save" program is a popular example of this tactic - with many prominent calls-to-action to increase the size of the subscription order to get an additional 10% off the total. Similarly, you can also opt to only show shoppers discounted items as upsell suggestions, encouraging them to take advantage of deals while they can.
Refined CTA messaging
You may be surprised by the effectiveness of changing passive calls-to-action on upsell suggestions. Instead of a standard "Products you may like" title, try something more engaging like "Must Haves" or "Perfect Accessories." You can always use A/B testing to find the wording that's most effective.
Free shipping with order minimum
Conditional shipping discounts are a great idea if you don’t have the capabilities to show users upsell suggestions that are either relevant to what’s in their cart, or based on their shopping habits and purchase history. More often than not, users will add items to their cart just to qualify for these types of promotions.