The worst situation for any retailer, is not being able to fulfill customer’s orders due to unavailable stock. Because, unable to process orders in time directly hampers the brand value (customer service + profits).
What are the key factors that lead to out of stock scenarios and how you can get rid of them?
1- Inefficiency in the supply chain process
No matter how good you build up relationship with your suppliers, if they are unable to supply you with products when needed the most will create an imbalance in your fulfillment process that leads to delay in order processing and most of the time, you’ll have to deny your customers. Apart from offering a bad customer service, you also lose profits for your business.
Ensure your suppliers will provide you with inventory whenever needed, and are flexible to delivery at anytime, anywhere. This will ensure products are always available for instant order fulfillment.
For instance: When you realize a particular product is out of stock on receiving customer’s order, it automatically delay your fulfilment process. To avoid such cases, dealing with suppliers who can directly pack and ship your customers orders themselves can be one of the solutions to overcome out-of-stock situations.
Having an integrated inventory management/dropshipment system will help you consolidate all your inventory and supplier’s data at one place, allowing you a real-time visibility of your stock levels. This will make it easy for you to enhance supply chain process, which is crucial for eliminating out of stock scenarios.
2- Inaccurate inventory level updates
You may be receiving your purchase orders in time that allows you to immediately fulfill your customer’s orders. But, if stock levels are not updated for every sale that is made will frequently result to out of stock situations.
Once you ship your customer’s order ensure your stock levels are instantly updated across all your channels to maintain accurate inventory counts and know when to reorder products.
For instance: You sell over multiple platforms and receive an order for one of your channels, now updating stock levels for that particular product across all your channels will automatically eliminate the risks of not having products, when needed the most.
Adopting an inventory management system will help you sync all your products in one system and auto-updates inventory levels across all your channels, whenever a sale is made. Doing so, you’ll permanently eliminate the risk of inaccurate inventory levels.
3- No safety lock practice
Though updating inventory counts after every sale is crucial to maintain a positive stock availability, but a relative function is also to safely stock products that will help you overcome out of stock issues.
Know your product performance and calculate safety lock for the best selling ones that can help you fulfill and process orders in time, even when stock levels are inaccurate. Yes, you heard it correct.
For instance: During festivals, you’ll experience huge rush of orders and this is when maximum chances of out of stock issues arises. Considering such situations, you can buffer additional stock level for all those products that you think will sell good.
Adopting a centralized system for managing inventory, means all your stock ins and outs are recorded at one place. This way, it will become easy to track fast-moving products for which you can calculate and add a safe lock and ensure orders are always processed as promised.
In the end, running out of products can hamper you from continual growth, however focusing on the above factors and practicing the tips and tricks will ensure your customers always get what they want.