Growing at a CAGR of 7.6% from 2020, global B2B eCommerce sales are expected to reach US $3 trillion by 2024. That’s over 5 times that of the B2C market.
In other words, the B2B eCommerce industry is booming. Manufacturers, distributors, and B2B sellers are turning online to sell, purchase, and research.
While that’s good news for online shops, this growth also brings a new set of challenges.
As traffic and demand increase, business owners will likely put a lot of stress on their warehouse management. Consequently, this may cause a few costly hiccups here and there.
Have an inventory management system in place. This allows business owners to track their inventory and ultimately mitigate the risk of not keeping up with customer demand.
What Is Inventory Management?
Inventory management is the process of controlling and monitoring your inventory’s journey from your supplier to your warehouse and ultimately to the customers’ hands.
This process ensures that you have the right number of products, in the right place, at the right time, and at the correct price.
If done correctly, especially if you operate multichannel eCommerce, inventory management will let you know when you should restock, what products generate the most sales and when your products are in high demand.
You could either do this manually or use B2B eCommerce inventory management platforms that utilize Application Programming Interface (API) integrations.
APIs are interfaces that facilitate connectivity and communication between multiple software applications. With it, you can seamlessly connect your company data with other third-party platforms.
Most companies that offer digital strategy services recommend you use inventory management integrations for your online store.
Why You Need Inventory Management Integrations
1. Saves Time
Manually inputting stock levels and monitoring products from storage to customers is cumbersome and takes up a lot of your time, which could be spent on other areas of your business.
Inventory management software can make your job a whole lot easier, as it automates manual tasks.
2. Leaves Less Room for Error
We all make mistakes. But in terms of inventory management, doing your inventory stocks wrong can lead to costly consequences. It can create unnecessarily long wait times; customers may receive the incorrect order, etc.
In that case, you’ll most likely worsen your customers’ shopping experience and ultimately damage your reputation.
Again, an inventory management integration will automate the entire process. Thus, you’ll eliminate any potential human errors that may cause you headaches.
3. Greater Profitability
Inventory tracking software gives you an insight into what type of products are selling the most during a specific time. That said, you’ll be able to manage peak seasons more efficiently.
4. Reduces Aged Stock
If not taken care of, aged stock, especially perishable products, can be a waste of money. After all, you can’t sell something that’s past its expiration date.
Furthermore, manually keeping track of each one of your product’s expiration dates is almost impossible. Thus, the event of having products go out of date is most likely imminent.
With the help of inventory management software, you’ll be able to monitor when your products are about to become dead stock easily.
Consequently, you’ll know what products you need to sell quickly so that you can reduce money wastage.
5. Product Stock Transparency
Not knowing what products are in stock or when they will be back on the shelves again can be a deal-breaker for customers.
However, the software gives you real-time control over your inventory, as it allows you to see current stocking information and provide accurate data to potential customers.
This way, you’ll eliminate any potential uncertainties your customers may have regarding the number of products they can buy.
Thus, they’ll be more likely to make a purchase or revisit your website when what they’re looking for is back in stock.
6. Stock-Out Prevention
Stock-outs occur when there is a sudden increase in demand for a particular product, which causes the product to sell out. This renders businesses unable to keep up with the sales, as the product demand remains high while their inventory is dry.
Inventory control software synchronizes your inventory and orders. They will provide you with automatic quantity updates and low-stock alerts. This allows you to get notified whenever a stock-out might happen and prevent the issue.
7. Better Business Negotiations
With the tracking abilities that inventory management software provides you with, you’ll better grasp which types of products are most profitable and which ones are not.
That said, you’ll monitor your suppliers’ performance and determine which ones are beneficial to your business.
You can use this information to your advantage by negotiating more convenient trading terms, for example.
8. Enhance Customer Service
With all the information from the inventory management software at your fingertips, you can provide customers with the product they need when they need it.
Constantly keeping popular products in stock will let customers know that whatever they’re looking for, they’ll always find it in your store.
Consequently, you’ll improve customer satisfaction and create a loyal customer base.
9. Precise Expense Tracking
Keeping track of financial information, like sales, expenses, taxes, and so on, is crucial for making wise business decisions.
Gathering all this data and calculating it manually will be incredibly time-consuming, though. Not to mention the human error risk factor as well.
Inventory management software can gather all of the necessary information in one place. With it, you can create accurate reports and easily determine what your next move should be.
10. Identify Faulty Products
Receiving and selling faulty products may happen at one point or another, and that will require a product recall.
However, tracking down affected products can become a major headache and take up a lot of time.
But, with the batch tracking functionality inventory management software provides you, locating faulty product batches will be a less challenging process.
Thus, you’ll be able to issue the product recall much quicker and leave your reputation relatively unharmed.
Must-Have Features for Inventory Management Software
1. Real-Time Inventory Tracking
Your inventory management software system has to show what products you have in stock and where they’re located.
Furthermore, any stock movements have to be reflected in real-time.
For example, inbound goods need to show up in the software upon scanning them at the warehouse. Sale orders also need to be reflected in your stock position. That way, you’ll avoid selling the same product twice.
Besides knowing what you have in stock and where it is, you also need to know what it’s worth.
Your inventory management system needs to integrate with your accounting software, as this will show the value of your inventory in real-time.
That said, a good inventory management system has to provide precise inventory values, account for variations in the volume or price of your purchases, offer multi-currency support, the possibility to track variable industry costs, etc.
3. Multi-Channel Support
As most eCommerce businesses sell their products on multiple channels, your inventory management system needs to integrate with a variety of channels as well, like Amazon, social media, etc.
This will ensure that your stock data is accurate across every channel you sell on.
4. Inventory Barcoding
This feature eliminates any potential data entry errors and automates functions that communicate with other parts of the inventory management system.
For example, inventory barcoding can integrate with other digital reporting and documentation features, like paperless invoicing or touchscreen signatures.
This way, the process of collecting, storing, and organizing inventory data will be much faster.
5. Inventory Alerts
Inventory alerts allow you to prevent any issues that might occur via SMS or emails.
Whether you’re running out of stock or some of your products are reaching their expiration date, a good inventory management system will notify you ahead of time so you can address the issue as fast as possible.
6. Inventory Reporting
Your inventory management software system has to deliver reports automatically. After all, there’s no point in using it if you’ll have to gather the data manually and draw conclusions yourself.
That said, look for a management system that provides data like stock age, unit sales, margins, how long it takes on average to sell each stock keeping unit, the backorder rate, etc.
7. Purchase and Supplier Management
Transferring inventory data manually during the purchasing process will make you prone to mistakes and cost you a lot of time.
An inventory management system needs to store supplier details centrally, let you see the transaction history with your suppliers, generate and autofill purchase orders, and automatically generate any quantity discounts your suppliers give you to ease the purchasing process.
8. Security and Backups
Last, you need to make sure that the inventory management software you’ll use has top-notch security. After all, you’ll store a lot of crucial data, and you wouldn’t want it to be vulnerable from hacking and not having a backup, for example.
That said, ask your provider about its authentication methods and encryption standards.
Inventory management is a must in terms of B2B eCommerce. Without it, you wouldn’t be able to determine what stocks you’re running out on, what products people buy the most, what products will soon expire, etc.
But, gathering all of this data manually may give you some headaches.
Inventory management software can automate the entire process while also helping you improve customer experience, spot and prevent any potential issues that might occur, and generally grow your B2B eCommerce business.