5 ways to manage your inventory better

by Arshiya Dey and Mohana Bhattacharyay on 14/11/2016
Inventory management is the backbone of most retail businesses. If you manage your inventory effectively, it can help you cut down unnecessary costs and streamline your business processes. In this blog, we talk about some ways in which you can plan and manage your inventory better while selling on Amazon.

Inventory Planning: To plan your inventory better it is usually a good idea to match your product supply with the expected demand. This can be done through detailed forecasting and planning. In simple terms, you need to ensure that you aren’t sourcing too many or too few products. Amazon offers many reports that you can use to plan your inventory better. For example, the Amazon Selling Coach can help identify inventory opportunities based on your sales and current inventory data. It provides personalized suggestions to optimize your stock levels. You can also view your listing status and details on the manage inventory page. This page helps you manage your inactive/out of stock listings to understand how heathy your inventory is and how you can improve it.


Sourcing Inventory: While sourcing excess inventory may block your money as a huge investment and impact cash flow, sourcing less than the required number might increase your ordering cost and the risk of running out of stock during peak demand periods. It is advisable to make it a habit to examine the trends of the previous sale periods and identify the future events can affect your supply/demand before placing the order with your supplier. Do not forget to negotiate with different suppliers based on changing factors such as product quality, logistics capability, trade regulations (especially when sourcing globally), value-added services and price.


Inventory Storage: Storing inventory demands special attention. It is usual for products to get damaged in warehousing operations. Pack your products well so that product handling does not lead to damage. Make sure you store your inventory in a physically secure place. Environmental conditions such as temperature and humidity also impact storage decisions for a number of product categories. Train your staff well to minimize inventory management issues.


Perishable Inventory: An effective strategy to manage perishable inventory or items with an expiry date is the First-in-First-Out mechanism. This means that the inventory purchased first should be dispatched first on receiving an order. This reduces the risk of your inventory becoming obsolete and also minimizes returns/claims on your account because of accidentally sending expired products to the customers. To implement this technique, you will need to put good warehouse management practices in place.


Dead Stock: Dead stock represents blocked invested money and blocked storage space. Clear out dead stock from time to time by offering deals and discounts, bundling them with other fast moving products or creating promotions. Regularly check the various reports on Amazon that provide intelligence based on sales data to avoid piling up dead stock.

Inventory management might get overwhelming for small retailers. Fulfillment by Amazon is a solution to manage all your inventory storage and shipment needs. Simply send your products to our world class fulfilment centers and we will store, manage and ship your inventory thereafter. There are extensive reports that will help you plan your next shipment, or even remove slow-moving/stranded inventory. Additional benefits such as eligibility for lightning deals, free and fast shipping under Amazon Prime, and trusted customer service for your FBA listings will help you maximize your effectiveness as a seller on Amazon.

You can contact our Seller Support team if you need further assistance on any of the reports or services mentioned above. To register yourself to start selling on Amazon, please click here. If you are already registered as an Amazon seller and want to start on FBA, please click here.

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