Opening an online store is a big step for small and medium-sized businesses. If something becomes clear with the coronavirus quarantine, it is necessary to have digital marketing channels not only to avoid losing customers but to reach new market segments.
But it also became evident how difficult it can be to set up your own e-commerce site, generate sales given the enormous number of options that consumers have today, and efficiently manage aspects such as delivery logistics.
And precisely one of the most common problems, no matter what the size of the company, is non-compliance with shipments due to stock problems. And that can be very frustrating for a business owner because we all know what it takes to capture the interest of a customer and finally get them to click “buy.” And it’s times like this when no one can afford to lose a sale.
That is why it is so important to work on a good inventory plan, which allows you to efficiently organize the purchase and sale of merchandise and which has two main objectives.
First, ensure that the products that customers demand are available at the time of each purchase. Secondly, and this is also very important, achieving maximum profitability, for example with early negotiations with suppliers.
But what should an inventory plan include? MyXborder outline the steps you need to take here.
Step 1. Have a centralized inventory management system
Millions of small and medium-sized enterprises have made the transition to online sales thanks to marketplace platforms, which let you launch an online store in a matter of hours. And there are also many who start managing their inventory with a simple Excel spreadsheet, and who begin to face problems shortly after, especially when the number of operations increases.
The good news is that today there are marketplaces that allow you to connect your store with an administrative system, which includes the inventory management module. This way, it will be easier for you to register orders, organize shipments, and access the information you need to make accurate forecasts and plan upcoming merchandise purchases.
Step 2. Set minimum stock levels
This can be a bit difficult to calculate when you are just opening your online store. But start by taking into account the expected demand that you established in your strategic planning, and define what would be the minimum quantity you need to have of each product (at this point it is also important to take into account the available budget).
When the stock in the warehouse drops below that number, it will be time to place new orders with the supplier. These minimum stock levels should be adjusted throughout the year when you have more information about which merchandise is most in demand and the behaviour of customers in different seasons.
Another important point is that you must keep the stock number of each product on the e-commerce site updated, especially those that are recording the highest sales so that there are no inconsistencies with what is actually in the warehouse.
And therein lies one of the great advantages of having your online store connected to a business administration system with an inventory module.
Step 3. Make a demand forecast
When your online store has been operating for six months (and ideally a whole year), you will be able to work with more accurate information about the evolution of sales and consumer trends in your target market.
Thanks to the data and reports that you can prepare with a business management system, it will be clear which products are most in demand, which are no longer so successful, and which are the busiest seasons depending on the type of product you sell. Analyzing marketing campaigns and average conversion rates can also be very insightful.
With this data, you will not only be able to ensure the minimum stock you need in the warehouse, but also better plan purchases, negotiate in advance with your suppliers, and obtain discounts and better payment conditions.
Step 4. Have fluid communication with your suppliers and clients
This is very important to take care of the reputation of your brand. As we already mentioned, keep all information updated about the products that are in stock on the site those that are temporarily out of stock, or if they have undergone any modification in their characteristics (for example, in the size of the presentation).
No matter how much you work on a good inventory plan, some problems may arise (for example, during delivery times during peak seasons). And the only way to contain an angry customer is with open and honest communication, which makes clear our commitment to their satisfaction.
As for suppliers, it is essential to have them in case, for example, we need to replace some products urgently, and they do not charge us extra charges for the quick delivery of a last-minute order.
You should also take care of your relationship with them so that in case of delays in production or an increase in prices, they notify you in advance and you can make the corresponding adjustments to the inventories and the price list.