Shopify is a popular eCommerce platform that provides fully hosted and cloud-based solutions to businesses of all sizes to help them to quickly and easily set up their online retail stores. One of its critical features is the Shopify inventory management software that facilitates inventory management. It allows for better business practices that can ultimately lead to business growth and profit.

Benefits of Shopify inventory management

The Shopify inventory management software is easy to install and use, and the company keeps refining and updating it to give better service to their clients. Aside from that, here are some more reasons why eCommerce businesses should consider using Shopify inventory management in their retail operations:

They can keep an accurate and well-organized inventory

Maintaining a well-organized inventory is crucial for businesses as it allows them to keep an accurate track of stock. By knowing what they have in their product inventory, they can install better controls to prevent the theft and spoilage of the goods. They can estimate when they will run out of stock. They will know when to order or manufacture more products and in what quantity. That way, they can avoid selling what they don’t have in stock, and can also not order more than they can sell. These practices are useful for reducing overall expenses.

They can better track their purchases from suppliers

Most businesses order their products from multiple suppliers. With the Shopify inventory management software, they can create a transfer page to keep a record of their incoming inventory. They can enter details like the supplier name, transfer location, expected arrival of a shipment, transfer reference number, product name, and product quantity. They can check if they have received everything fully or partially from the purchase order, and organize it as accepted, rejected, or canceled.

They can transfer their inventory between different locations

It is often necessary for businesses to transfer their goods from one active location to another, and the Shopify inventory management software can help them to keep track of these transfers. They can track which place the transfer is coming from, which destination it is going to, the quantity of the products, and the expected arrival of the shipment.

They can conduct an ABC analysis of their inventory

It is essential to conduct an ABC analysis of the inventory as that can help businesses to categorize their products better and prioritize which products they ought to focus on to gain more profits. They can grade their products according to their sales records. The products that sell the most and bring in about 80% of the business revenue will go into A grade.

In the B-grade category, there will be the products that sell well intermittently, account for about 15% of the business revenue, and can sometimes become best-sellers. The products that sell the least and bring in only about 5% business revenue will go into the C grade.

By focusing on the A-grade best-sellers, the businesses can cut down on the warehousing expenses, product storage and maintenance costs, and product advertising costs for the goods that their customers don’t order as much.

They can offer better customer service

With sound inventory management, businesses can optimize customer fulfillment and offer customers better service by developing a good understanding of their buying behaviors and product preferences. They can keep tabs on seasonal buying trends and use that data to think up and implement new business and product ideas. They can also check how they are doing financially and profit-wise.

The basic functions of the Shopify inventory management software are excellent for businesses that make their product purchases directly from the supplier and don’t have a complicated inventory flow. As they expand their operations, Shopify will allow them to create and track multiple channels for their inventory management and marketing practices. They can also sync their online stores with social media platforms.

If the businesses require more advanced features and increased functionalities for better inventory control, they can get different third-party apps and integrate them into the Shopify software. There will be an additional cost for these apps, and some of them are expensive, but they will be worth the many business benefits that they bring.