Order and Inventory Management in E-Commerce
Launching an online store today is surprisingly straightforward — there’s no need for a physical storefront, costs remain low, and your reach can be global. However, managing orders, inventory, and often the warehouse (if the business holds physical stock) remains a complex and challenging task. This does not apply in the case of dropshipping.
It’s perfectly normal to begin with manual inventory management, especially when exploring the market and possibilities. This scenario is very common among small businesses. However, as business starts growing, business owners often continue using the same inventory management strategy simply because they are used to it. As a result, the need for inventory management tools often arises during a crisis when orders are delayed, stockouts increase, or excessive stock depletes cash flow.
In other words, inventory management is a business's money and its flow management. So, inventory management should not be the way out of the crisis when it happens. It has to be part of your business plan when you start it.
For example, when an e-commerce store manages more than 1,000 different products (SKUs), manual tracking becomes inefficient or even practically impossible. In such cases, it’s time to consider automating inventory and order management. A similar situation arises when the number of daily replenishment orders exceeds 20. What does sending 20 orders to suppliers mean? It requires checking each supplier’s product stock, calculating the reorder quantity for every SKU, verifying whether any orders have already been placed, and so on. This is a time-consuming process, and often it becomes impossible to thoroughly check all products manually because it simply takes too long. This is a clear sign that it’s time to automate these processes.
There are reasons why you should change your approach and start growing your business professionally:
Mistake multiply: tracking stock by hand often leads to errors, like accidentally overselling or forgetting to reorder popular items.
Time drain: updating spreadsheets takes hours that could be spent improving your website or marketing products.
Challenges in scaling – as order volumes and managed SKU counts rise, manual methods become increasingly difficult to sustain, because it is simply impossible to verify all items and orders on time.
All of these issues lead to painful consequences for any business, either growing stock shortages or mounting excess inventory. In both cases, the business incurs losses.
The problem with manual processes
Automation offers a clear solution. It makes processes faster and more accurate. When systems work on their own, the chance for human error drops. Data updates instantly, and orders are processed without delay. With automation, handling busy periods becomes much easier.
A well-functioning inventory management system transforms the situation. It enables efficient monitoring of stock levels, optimization of order planning, and reduction of unnecessary expenses. When inventory levels are visible, it becomes easier to assess stock availability and identify opportunities for improvement. For instance, if a product continually experiences stockouts, the level of held inventory should be increased. Conversely, if sales of a product have declined and the existing stock occupies valuable storage space and ties up working capital, it may be worthwhile to liquidate those items.
Good order management is just as important as tracking inventory. Modern systems can handle the entire order process, from the moment a customer buys something to when it ships. These systems reduce delays and avoid mistakes. Regular and accurate updates help keep customers informed. When every part of the order process works together, the whole operation runs much smoother.
The benefits of an automated order and inventory management tool
Connecting with e-commerce platforms like Shopify and Amazon
Many e-commerce businesses rely on platforms like Shopify or Amazon. These kinds of platforms often provide tools that integrate seamlessly with other systems. When e-commerce platforms are properly connected to inventory management solutions, data flows smoothly between them, ensuring the most up-to-date information on stock levels and sales. In most cases, advanced inventory management systems allow for data import from multiple channels, enabling operations across several platforms while maintaining a single, unified inventory management system. As a result, managing inventory becomes simpler and requires no additional effort.
When launching an e-commerce store, it is important to recognize the right moment to transition to automated solutions. Agree with your team on the key indicators that will signal when manual management becomes too complicated and inefficient. These indicators might include the number of SKUs in storage, the volume of daily orders sent to suppliers, increasing lost sales because of stockouts, or excessive working capital tied up in slow-moving inventory. Do not wait until the situation becomes overwhelmingly complex, especially now, when you can subscribe to an advanced inventory management system for just a few hundred euros per month.
With an automated inventory and order management system, you gain all of the following advantages:
Clear rules for what needs to be done, when, and how.
Transparency and visibility- real-time insight into stock levels for every SKU, including shortages and surpluses.
Dynamic inventory management - one of the most advanced methodologies is TOC dynamic buffer management.
Automatically generated replenishment orders.
Freed-up resources for other important tasks, such as negotiating with suppliers, expanding your product range, and better meeting customer needs.
Modern inventory management systems are often compatible with popular e-commerce platforms (Shopify, Amazon, etc.), allowing you to synchronize data effortlessly and manage inventory and orders professionally.
FluentStock integrates seamlessly with Shopify, allowing you to manage orders and inventory like a pro. Choose the plan that best fits your business.
If you have any questions about the Fluentstock tool, please feel free to contact us.
