How To Scale Your Ecom Business Via Multi-Channel Inventory Management

Posted by RodneyLaws on November 6, 2019

Though the startup costs are low, ecommerce businesses are capable of incredible growth. The retail world is littered with examples of online-only retailers that started small and expanded massively to become bigger than brick-and-mortar companies could have.

If you’re a low-level merchant, the significance is clear: you can (and should) have lofty ambitions, because there’s absolutely no reason in principle why you can’t build the business of your dreams — though that doesn’t mean it’s easy. Reaching a point of stability is one thing, but growing to the enterprise level (or even somewhat below it) demands a strong strategy.

So what tactics should go into your strategy? Well, one that can serve you extremely well is multi-channel inventory management. If you’re not familiar with it, that’s fine — I’ll run through an outline before I get to some core tips about how to implement it.

What is multi-channel inventory management?

Scalability is one of the key benefits of ecommerce. Cloud-based resources can be extended indefinitely, often on a pay-for-what-you-use basis, and promotional efforts can be rapidly ramped up through increased budgets. But what about inventory management? That part of online retail hasn’t been so easy to manage, and still poses a lot of problems.

Due to the inefficiencies innate to the processes of ordering, receiving, storing, checking and shipping stock, there’s a lot of room to improve when it comes to your warehousing activity — particularly when you’re selling through multiple sales channels (e.g. Amazon, eBay, and your own ecommerce store). This is what multi-channel inventory management is for.

In essence, a multi-channel inventory management system allows a merchant to monitor and control a single inventory being used by multiple storefronts. That way, you don’t have to worry about an item running out of stock in one system but being overstocked in another, or having to spend large amounts of time making adjustments to product listings: update a description in your multi-channel inventory management system and it’ll roll out to every linked system.

It’s particularly valuable in the context of running a hybrid operation (selling both online and offline), something that’s increasingly popular due to the saturation of online selling. A modern POS system can hook into an ecommerce CMS (think WebKul’s POS module for OpenCart, or Shopify’s hardware POS kit), ensuring that all products — whether sold in person or over the internet — are tracked in precisely the same way.

How you can implement it

Having established why multi-channel inventory management is so useful, let’s now take a look at how you can make it an established part of your ecommerce business:

Identify your required sales channels

Which marketplaces do you want to sell through? Amazon is massive, for instance, but not everyone wants their products listed — any given merchant could object to the working conditions, the cut of the profits, or the likely dilution of their brand. Take a look at all the marketplaces used by your prospective customers, and decide which ones matter to you.

Remember this: even if you’re maintaining a single inventory, it will always take more work to handle multiple storefronts, so there’s little point in getting your products listed through a marketplace that won’t return enough value to make that work worthwhile.

Choose an inventory management system

Here’s the most important part of the whole process: choosing the software you’ll be using to manage your inventory. Good candidates for OpenCart users include Linnworks, Veeqo and ChannelGrabber, but there are plenty of alternatives out there. Use sites like Capterra to find some reviews and feature tables, and go from there.

Consider that it can be frustrating and time-consuming to migrate from one system to another, so invest plenty of time (and money, if needed) to choose the best possible option.

Be very careful with granting access

Finally, it’s worth noting that managing your product listings across numerous marketplaces through a single system does present something of a security issue. If you give someone access to that system, it’ll grant them a lot of power to make major mistakes, so be extremely selective about providing admin accounts.

Multi-channel inventory management is superb for making the most of available sales opportunities without spending inconvenient amounts of time or money. If you haven’t considered it yet, then now is a great time to get started.