A stock management successful, it can lead you to increase your sales, win new customers and increase the trust of your existing customers, among other benefits.
There are several ways to organize the stock of your online store. Before describing them, let’s see some key questions that you should ask yourself to see what type of logistics is the most suitable for your ecommerce:
- Do I sell my products to direct consumers or to other businesses?
- Do I have a wide variety of products? Is there a chance to diversify my product portfolio?
- Do I take care of the manufacture of my products or do I purchase them from suppliers?
- Do I have the necessary money to assemble my inventory and maintain a stock?
- Do I have a physical space available or do I have to rent a place?
- Is my product perishable?
- Are there legal regulations on my product?
what does stock mean
Stock is the set of products that a brand has stored and ready for sale. In most cases, these products have variants, that is, features that subdivide and personalize them.
There are two types of variants:
- Those that do not change the appearance of the product. For example, the size or the size.
- Those that change the appearance of the product. For example, color or pattern.
For variants that change the look of the product, it is suggested to publish a different product that represents each variant. For example, Red Cushion, Yellow Cushion, Cushion with The Beatles printetc.
For variants that do not change the appearance of the product, it is not necessary to publish different photos since the product will ultimately remain the same.
In order to control the stock of your products thoroughly and to be able to meet the expectations of your customers, you need to configure each variant of each item.
If you have a Cloud Store, we share the following tutorial
Types of stock management
Let’s look at each type of stock management and its advantages and disadvantages.
own stock
In this modality, the store owner has his own space to store the quantities of his products (either produced by himself or purchased from various suppliers).
To use this type of logistics, try to have enough money to maintain your own warehouse, with staff in charge and constant replacement of merchandise. This type of stock will only supply your online or physical store.
The stock is yours and you don’t share it with anyone, which makes it easy to store and organize your products the way you want. The biggest benefit of this type of storage is delivery speed.
In addition, total control of the availability of what you offer facilitates the relationship with the client in the event of a problem.
The main disadvantage of this type of stock is that there may be a surplus when demand is low. This can generate additional losses and expenses, since many times you will have to lower the value of the product by offering promotions or discounts to get rid of the surplus.
The last relevant aspect that we want to mention in case you choose to have your own stock has to do with the organization of the storage place. To achieve an effective circuit you will have to make some decisions regarding aspects such as the following:
- What will the ‘picking’ route be like (the action of picking up the product and taking it to the assembly table). This must be optimized so as not to crash in high activity situations.
- What size will the warehouse aisles have (they should be wide enough for the ‘picking’ action to be carried out comfortably and quickly)
- In what format will you store your products (baskets, pallets, etc.). This will depend on the type of product you sell.
- How many levels will the storage gondolas have? That is, how many shelves up will they have.
- Where the orders will be prepared and where they will be stored until they are dispatched to the senders.
If you need help creating your own stock control spreadsheet, we invite you to read this e-book and access the spreadsheet we prepared for free!
Third party stock (on consignment)
This other type of stock consists of the purchase of a certain number of products from a supplier, but on the condition that if they remain stranded in your store/warehouse until a certain date, you can return them to the supplier.
The main advantage in this case is that you you save the risk of having excess stockwhich can cause you to lose money.
The main disadvantage is that not all products are optimized for this type of stock; In general, the most durable products with the lowest turnover (because of their value or seasonality) work with this type of management.
In addition, since the supplier must take the risk that you keep the stagnant product and thus absorb its cost, it will pass that value on to you in some way, for example, by charging a higher purchase cost per unit.
This last mode consists of outsource stock and product deliveries. In this way, you will basically be the intermediary between the supplier and the client, without having to maintain a warehouse and manage an inventory.
The advantage is that you save yourself having to rent or buy a warehouse and carry out inventory management; In addition, you will not have to buy the product unless you have already sold it and have already received payment from the customer (ideal for small ecommerce, since the initial cost is reduced).
A disadvantage of this modality is that you do not always have a guarantee that the product will arrive in the best conditions to your client, and sometimes you may not be sure that it totally coincides with the advertised product since you do not see it before sending it; That is why you must trust a lot in the provider you choose.
Also, keep in mind that this management mode is used for businesses that sell more commercial products, and less artisanal.
Here we tell you everything you need to know about this type of stock management:
Article
Stock control in your store
Once you have determined where and how you will store your products, you should think about how you will coordinate the actual amount of stock that you have available in your warehouse, with the number that appears visible in your online store.
If you have , controlling your stock will be a simple task, since you only have to enter the total amount you have of your products, and as you sell, the number will be automatically reduced.
In case you have physical stores as well, and share stock between your online store and offline stores, we recommend that you hire one to avoid confusion.
For example, if they buy a product in your physical store but you forget to modify the stock in your online store, in this way, it could happen that someone makes an online purchase and finds that in reality that product is no longer available.
This can lead to frustration and damage your brand’s reputation. For this reason, if you will share stock between your physical and online store, we recommend that you automate the process with a specialized service.
In addition, there are systems specially designed for , such as Dragonfish (belonging to the company Zoo Logic) that you can integrate into your Tiendanube .
conclusion
In simple words, there are two variables that you will have to define regarding the stock of your business: the first is to decide if the product you will manufacture yourself or if you will buy it from a third party, and the second has to do with where you will store it.
If the product you sell is purchased from a manufacturer and you are just starting your online business, it may be more convenient for you to outsource stock management and opt for a drop shipping. On the other hand, if your product consists of something more artisanal, you should consider having your own warehouse.
We hope we have helped you better understand the types of stock in ecommerce. As always, if you have any questions, ask us below! We will be happy to help.
Do not forget to share the article with your friends so that more and more of us are learning about ecommerce. 🙂
And if you want to sell online but still don’t dare, you can start and create your own online store.
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