The Key to Amazon Inventory Management

The secret is automated inventory management. With inventory management technology built for Amazon

  Touseef Riaz

Posted on: 12 Oct 2021

Amazon Inventory Management


When we talk about the inventory management system of the business, the things that come to our minds necessarily include; how to manage the stock effectively? What would be the cost of the products? How are we going to ship it? How will the storage costs be handled? And the excess inventory would be taken? The answers to all these above-stated questions could be given by undertaking important and influential methods to manage your business's inventory management system efficiently.

Today is the age of digital platforms; businesses are switching from physically created companies to virtual ones. Since the pandemic has made an enormous impact and severely affected all the firms, people prefer to carry out their business and job dealings online by sitting at their homes. Speaking of this virtual platform, Amazon is well-known and one of the biggest platforms in the US when it comes to online business, so today, our topic of discussion would also be about the inventory management of Amazon.

What is Inventory Management in Amazon? 

When we start a business, whether, in a traditional form or online basis, the most important thing that we need to take care of is the products we are selling, stocking, and managing the products effectively would maximize profit. So when it comes to the vastest worldwide platform like Amazon, one would indeed wonder how it would be carrying out the operations of its inventory management system. For sure! Jumping right into the topic, the inventory management system used by amazon is FBA "Fulfillment by Amazon." It has been running successfully for quite a long time now. 

How does FBA deal with the inventory of Amazon?

Before jumping into the activities carried out by the FBA, you need to create an account on Amazon Seller Central. Once you are set up with your account, you will be advised to choose FBA as your shipping and transport services towards the customers. While running a store on such a big platform, you need to be careful regarding your Amazon Inventory Management system. In addition to this, if you choose FBA for your Amazon platform, you would also be able to get advantages from new Amazon features. So, for doing so, you need to follow the below-stated steps;

1. Firstly, add your FBA to your Amazon Seller Central account.

2. Now, you need to make a list of your products and state them over there in the Amazon catalog. However, you could always employ inventory management software for doing these things for you.

3. Always be prepared to ship your products after manufacturing. In addition to this, for packing the products, you could always take help by ordering the shipping material from Amazon's prep and shipping supplies. Some of the packing essentials like; cartons and bubble wraps would all be delivered to your address to ship your products nicely to the customers.

4. Now, when you have packed the products, you need to ship them to the warehouses of Amazon. Make sure that your transportation service is trusted and can be tracked until it reaches the Amazon warehouse. Once you get there, you would be totally at ease because now it's their responsibility to monitor your stuff. And a trusted source like Amazon would never risk its reputation by making any mistake. 

5. Amazon FBA then delivers your product to its customers. Some of the products being shipped through Amazon have no charges of shipping. When you make an order twice, or the same order is placed by someone else, Amazon quickly fetches the product from its warehouse by ensuring the quality and nature of the product carefully and then delivers it to you. However, you are always given a message or a notification about a tracking ID that will provide you with all the updates regarding where your product has reached and how many days it will be delivered, etc. By this, your Amazon Inventory Management becomes easy and more straightforward if you utilize FBA as your shipping system. 

6. Customer support services at the back end are also an essential part of FBA when the sales are carried out. However, delivering and fetching products is not the purpose of Amazon; it makes sure to await the customer's responsibility as well because it spreads the view that Amazon wants to work more with you in the future. Who would not want to think about expanding and earning more profit in the future, right? 

Moreover, Amazon FBA serves well when it comes to delivering your products to its customers and receiving the customer's responses. Whenever your customer has any complaint about the products or wants to make a return or refund, FBA stands alongside them and supports them in every regard. Their customer support services are available 24 hours a day, so you can relax totally when dealing with Amazon. 

Importance of Inventory management in Amazon:

As we have heard above about the Amazon inventory management system, managed by FBA, you need to take some essential measures to effectively run your operations related to the stock of your business. In addition to this, there is much software being published nowadays. You can always hire an Amazon inventory management software to carry out efficient dealings related to your business's stock. However, utilizing FBA in managing your inventory could result positively in your favor as it can provide some of the practical guidelines for your business's inventory. Following are the main aspects in which amazon inventory management could help you more profitable than others;

-Managing the costs of storage:

The main problem of your business would be how to manage the inventory effectively; it could be solved by using FBA at amazon. However, you are not bound to use it for your product's shipping services, but with its help, you could be facilitated in many other things related to the shipment process.

-Eliminating the dead or waste products:

Amazon works so hard to classify your products more efficiently. You can quickly identify which of your products are yielding a good amount of revenue for you and which of them are just eating the cost of your business. As we are aware that Amazon is a vast and well-known platform, you could be able also to employ software that will help you create segments of the stock so it is managed efficiently. Moreover, by segmentation, you will know which portion of the products is earning more for your business and which is just costing you even more. 

-Improvement in the technical management tools:

By using the Amazon inventory management system for the effective management of your Amazon inventory, you would be able to solve all the technical issues of your business more effectively. For instance, the service department is down, the orders are being received late, etc.; Amazon's inventory management system efficiently manages such problems. 

-Ensuring the right delivery services:

Using FBA by amazon always guides you skillfully in terms of services regarding how to ship and transport your products to the customers. It also acts as a trusted medium between the customer and the company. Even after delivering the product, FBA awaits the response of the customers regarding their products. And if any problem occurs, their Customer help and support system is available 24/7 to guide and help you in every regard. 

Problems you face in the management of your Amazon inventory:

When we are managing inventory-related matters in our businesses, many problems are seen and faced. Some of them are small and handled quickly, but some require proper focus and experienced actions. Similarly, in Amazon, when you are working in the area of the inventory management system, you will be faced with a lot of issues relevant to the stock of the company. Similarly, when Amazon manages inventory, you face a small number of problems if you aren't familiar with this platform. 

Furthermore, when we talk about problems related to inventory, it occurs directly in our minds that the stock is over-loaded or is just short. But you have to satisfy your customers at any cost. However, if you wish to get rid of all the problems and live in a relaxed business environment of Amazon, it would be the best step to take help from hiring inventory management software.  This software will guide you and take over your back-end inventory management system so that each sector is automized. This eliminates the chances of mistakes in the calculations. Some of the fundamental problems that one faces in the Amazon inventory management system include; 

  • Error in maintaining income statement.
  • Risk of being out of stock.
  • A poor system was installed for management.
  • Orders are not classified correctly.
  • No skillful monitoring.
  • High costs due to excess inventory stored.
  • No automization of operations.
  • Use of old technologies.

How to manage your Amazon inventory efficiently?

When you decide to manage your operations related to the inventory of your business, be ready because it will not be a piece of cake. Proper and regular monitoring is needed for the effective management of your business's inventory at Amazon. Because let's face it, it is undoubtedly the most trustable, and well-known platform which requires proper and effective staff indulged too. So any slight mistake could also lead to a significant loss. Therefore, below there are some of the basic steps you will require to run your Amazon stock much efficiently;

  1. Understand when to buy.
  2. Keep in mind the seasonality.
  3. Survey the markets and inspect the competitors
  4. Focus on the relationship with your suppliers.
  5. See what the customer wants.
  6. Be Alert about what is new in the market.
  7. Advertise and re-market old products.
  8. Keep your product supply slow when needed.

Wrapping up:

Amazon is an excellent platform when it comes to setting up the dealings for your E-commerce store. Using it as your shipping service would make your image more trustworthy in the eyes of your customers. FBA lets you track your orders till when they are in transit. In addition to this, by using FBA, Amazon manages an inventory of your business in a very efficient way, so you are entirely relaxed regarding any aspect. 

Furthermore, there are thousands of distribution centers of Amazon worldwide that use its services. Your goods are perfectly safe with Amazon's FBA. In addition to this, there is absolutely no risk of any fraud or threat activity. If you have read this article thoroughly, you would be able to decide by now whether you should do the packaging and shipping of your products on your own or hand them over to the FBA, Amazon's inventory management system.