Availability of stock is the degree to which the retailer or brand manages an
inventory of their listed
products to fulfill customer demand. To address the conventional stock availability for all
products,
sellers must have provision for inventory management to ensure real-time insights and current
stock
updated to meet upcoming consumer demand. Stock availability of products becomes more
challenging
when it comes to unexpected demand and supply changes.
But, it is not rocket science to manage stock availability; retailers and brands must work on
balancing
the demand and supply changes and keep inventory in check all the time.
Why is it essential to manage stock availability?
One of the critical tasks of running a retail business is inventory management and
optimizing associated
costs. For offline stores, it is challenging to maintain stock availability. When selling
online, ensuring
product availability across various retail sellers and marketplaces can impact conversions
and sales
effectively.
● Understocking arises when a product or brand fails to fulfill customer expectations. If
this
happens to repeat frequently, customers may not visit the brand's websites or store
again due
to the initial experience. We can't say that understocking is a fault of the brand
entirely because
they may not always be able to cope with the rising demands. However, it is about their
caliber
to match the quick change in trends with the help of historical data analysis and correct
inventory forecasting.
● Overstocking: When a company purchases too much inventory, this case occurs. Having too
much stock of products will result in high storage and security cost, obsolescence losses,
and
shrinkage. Additionally, if a company can sell this stock quickly, product quality and value
will
remain high, which leads to more losses.
We extracted data to study the influence of short-term stock out on the most prominent
eCommerce
giant Amazon for one of our clients. Here is what we learned and suggested to our client.
Read to know
more.
Top 5 Ways To Improve Availability Of Stock
Accurate Data Collection
When a company works to sell multiple products parallelly through a supply chain, it can
easily face
inaccuracy in inventory management. Discrepancies in actual product inventory and system
value can
lead to overstocking and understocking. The most favorable way to negate these discrepancies
in lists is
to use a tool to manage e-commerce inventory that informs you about your stock in real-time.
This is
for retail businesses that are working offline.
eCommerce Inventory Management
Proper inventory management for eCommerce is essential to ensure products are available in
stores.
Keeping an eye on the inventory level of your products and ensuring that you have maintained
the stock
to match the demand can prevent potential loss in sales and keep the company operating
smoothly.
Companies must ensure their stock is available across all of the online platforms they sell.
Access to real-
time stock data can help monitor stock updates across all the retailers and Market places if
it is available
or not. Retail sellers also must monitor market trends to maintain inventory assortment
using consumer
demand analysis.
Understanding Consumer Demand
To forecast future demand accurately, studying historical data on customer shopping trends
is the only
way. What do your consumers buy during holiday event seasons? What are the coming trends in
your
product field? Having the data-based answers to these questions will help retail sellers,
and big
companies properly manage their inventory based on web data analytics.
Adequate Prediction
Anticipating expectations will help to stock products during a particular season
accurately. Monitoring
previous sales and factors like Seasonality, promotional economic situation, and peak buying
months
help companies forecast demands. Studying these databases will also help companies get deep
insights
into the targeted market.
Improve Supplier Relationships
Regarding the supply chain, it is essential to depend on it to deliver your
shipment regularly. In fact, you
should maintain close bonding with your suppliers for stock availability improvement and
cost-cutting.
You must share important details like future demands so that your suppliers can provide
products
timely.
Consequences Of Managing Inventory Inefficiently
What is the impact of overstocking?
Tied-up Cash: Money invested in overstocking is a tied-up cash that your brand could
have used on
other activities in a better way. You can use that amount to free up repay loans and pay
rent and
employee salary. Inventory can frequently lead to material degradation, obsolescence, change
in
consumer behavior, spoilage, etc., to potential losses.
Product Expiration: If your company offers time-sensitive products like food or
medicine, they tend to
expire after a specific duration. For these products, overstocking can be a disaster if
these products are
not sold before the expiry. So eCommerce platforms need to sell these products at a lower
margin to
liquidate the inventory and avoid potential losses forcefully.
What is the impact of understocking?
Bad Customer Experience: less product availability will impact customer loyalty and drop
customer
satisfaction, which may lead to potential loss of customers in the future.
Missed Sales: If you can't provide the demanded product to customers on
time, they may switch to
another store or brand to meet their requirements. This can lead to a loss in sales due to
frequent
stockouts.
Bottom Lines
To negate the impactful consequences of understocking and overstocking,
retailers and brands need
real-time inventory management for offline and online businesses. At Product Data Scrape, we
help
these companies to plan the supply chain effectively by reducing the latency period. If you
need to track
your eCommerce stock, reach out to our team at Product Data Scrape and grow your business.
