Stock, delivery, returns, invoices and payment – keeping on top of what’s coming in and out of your eCommerce business is an endless task, made all the more challenging as your business begins to grow. If you’re eager to get (and stay) on top of your eCommerce inventory management this year, then read on as we take you on a journey of the tips, tricks and eCommerce inventory management software to get you there.


What is inventory management

The importance of inventory management

How to manage your eCommerce inventory

Managing your inventory manually

Managing your inventory using inventory management software

When to use inventory management software

Choosing the right inventory management software features

Choosing the right inventory management software provider

Final thoughts


What is inventory management?

eCommerce inventory management is the process of knowing how much stock you hold and where it is in the order journey.

That includes details such as:

The quantity of stock you have available to buy (including bundles and kits)

The quantity of stock ordered but not yet paid for and/or shipped

The quantity of damaged/reduced stock

Cost and listed prices

How long stock has been held in your warehouse


Together, this gives you a picture of your whole inventory.


The importance of eCommerce inventory management

Knowing how much stock you have left to sell is great, but inventory management is that and a bag of chips. Accurate inventory management enables you to confidently increase your customer numbers, grow your sales and maximise your profits through:

Never selling out

Sold out items are great news for your competitors because 72% of online shoppers will head to them if you run out stock, and 67% will stay with head back to them future visits. Overstocking items can help but this also results in higher warehousing fees, and it isn’t a suitable solution for perishable or seasonable items. Accurate inventory management provides you with up-to-date visibility of your stock levels and how this much stock would typically last for, enabling you to re-order stock just before you sell out.

Avoiding overselling

Selling out is bad, overselling is horrendous. Allowing a customer to order and pay for an item that you no longer hold in stock, is fatal to your customer service, brand image and seller ratings. Being acutely aware of your stock levels and updating your sales channel(s) accordingly avoids this dilemma completely.

Cash flow

You’ve got a lot of money tied up in your inventory so how you manage and maintain it directly impacts the health of your cash flow. Live inventory management provides an accurate picture of your assets and cash flow, allowing you to budget for more stock, move slow-moving stock, and ensure that your business has the money to run smoothly.

Informed business decisions

Having the data behind how quickly stock is moving, how much warehousing space you need and how much stock is waiting to be shipped empowers you to make business-critical decisions. You have the insight to know what to stock more of, what to stop selling and what to reduce in price at different times of the year to maximise your profits and minimise your outgoings.

Multi-channel selling

Thorough inventory management becomes crucial when you expand your eCommerce business to multiple sales channel(s). Multi-channel selling increases your exposure, customer numbers and sales – increasing the volume of stock coming in and going out. Having a handle on your inventory management allows you to manage multiple sales channel(s) easily, ensuring that each platform has current stock levels and that you can confidently grow your sales.

Beating the competition

And last but by no means least, being in stock, having the cash flow to expand and selling on multiple sales channel(s) keeps you one step ahead of your competition. Case closed.


How to manage your eCommerce inventory

So, we’re on the same page when it comes to the importance of inventory management but how exactly do you “do” inventory management?

Managing your inventory manually

If you’re just starting out as an eCommerce business, you’ll likely opt for manual inventory management using a mix of spreadsheets, post-it notes, charts and tables. This is a great way to understand the workings of your eCommerce business properly, and it just requires:


Keep an up-to-date record of all your sales data (using spreadsheets) including stock levels, cost price, list price, sales date, sales channel and warehouse space.

Re-order alerts

Using this sales data, agree a minimum level of stock to reach before re-ordering and use manual reminders to alert you when this level is reached.

Order management

Stay on top of your orders to ensure that stock levels are promptly updated on all of your sales channel(s) (to avoid selling out or overselling).

Additional staff

During busy periods (Christmas, sales, holidays etc.) employ temporary staff to help you stay on top of your manual inventory management.

Manual inventory management is definitely the cost-friendly option, to begin with, but it does run the risk of mistakes, unfulfilled orders and taking up too much time. When sales volumes start to take you away from proper manual inventory management, it’s time to consider inventory management software.

Using inventory management software

eCommerce businesses serious about growth and multi-channel strategies use inventory management software. Multi-channel inventory management software sits between you, your sales channel(s), your shipping carriers, your accounting software and your reports, allowing orders and data to flow between each, ensuring that every platform is accurate and up-to-date.

It does this through:

Automatic syncing

Stock levels are synced live, automatically updating your sales channel(s) and removing any manual process in updating them.

Inventory visibility

A central platform gives you a quick overview of your stock levels and business performance. You can then drill down into what is selling well, where and when to plan your eCommerce business strategy.

Bundles and kits

Selling bundles and kits online can be an inventory nightmare. Inventory management software automatically calculates and updates your individual and bundle stock levels across sales channel(s).

Low stock alerts

Inventory management software alerts you when your stock levels are low – allowing you to sell with confidence and to never have to limit sales by ring-fencing-fence stock.

Processing returns

Multi-channel inventory management software also enables you to alter your stock levels and sales channel(s) when re-sellable stock is returned – minimising any loss.

Ultimately, inventory management software saves you time by taking on the manual tasks of managing your stock and orders, saves you money by maximising the stock that you can sell and lowers your operational costs by reducing warehousing space and staff costs. Time and money that you can invest back into growing your business and making your customers happy.


When to use inventory management software

The decision to switch from manual inventory management to inventory management software is an exciting one, showing that your eCommerce business is growing, but it can also be a difficult one.

Ask yourself the following questions to determine whether it’s time for you to use inventory management software:

Are you spending time controlling your inventory that could be better spent on other projects or tasks?

Are your products regularly selling out or overselling?

Do you find it difficult to keep on top of updating your stock levels across sales channel(s)?

Does calculating you kit and bundle inventory levels cause you sleepless nights?

Are you confident that your current system of inventory management is providing you with the confidence, data and sales you need for your business to grow?

Choosing the right inventory management software

Once you’ve decided that it’s time to invest in inventory management software, next you need to decide what software you’re going to invest in. There are many inventory management systems out there, with a variety of features that you will and might not need. When narrowing down your choices, ensure that the platforms have the following essential features:

Live syncing

You want your life to be easier, which is why live and automatic syncing of your stock levels is the single most critical feature.

Cross-channel stock overview

If you’re already multi-channel selling, or it’s in the pipeline, multi-channel capabilities are a must.

Kit and bundles

If your products can be brought as part of a kit or bundle, look for an inventory tool that calculates associated stock levels accordingly.

Re-order limits

The ability to set re-order limits should come as a standard on inventory software – prompting you to re-order stock.


Likewise, the ability to update stock levels with returns is usually a basic feature.

Additional functionality

Adding yet another piece of eCommerce software to your business can bring yet another frustration to your eCommerce business. Another login, another system to master and another duplication of data. Avoid this by looking for multi-functionality eCommerce software that incorporates inventory management alongside multi-channel management, shipping carrier integration, reporting and the ability to send sales orders to Xero. One login, multiple features, and lots of time saved.

Choosing the right inventory management software provider

Once you’ve narrowed down the features your eCommerce business needs, you need to pick a provider. There are plenty of inventory eCommerce software providers out there (us being one of them!) but whoever you choose, look for:

Pricing structures

Opt for a provider who offers different pricing packages depending on the size of your business – big tools don’t need to come at big prices.

Free trial and demo

The best way to see if inventory management software is for you it to take out a free trial or demo. We offer a 7-day free inventory management software trial because we’re confident that you’ll love us in less than two weeks.


Wouldn’t it be nice if life all went to plan? We know that doesn’t always happen, which is why a great support team (supplemented by invaluable user guides) is a must.

Final thoughts

Good inventory management is good business sense. Inventory management software makes it easier, allowing you to grow your business, satisfy your customers and maximise your profits confidently and successfully – let us show you how.


About Expandly

Expandly multi-channel inventory management software combines all the good parts of inventory management software with listings, order management and accounting across sales channel(s), shipping carriers and accounting software. Let us show you how with a free inventory management software demo.


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