With current supply chain issues, it’s more important than ever to understand your inventory. The delay between when you place orders and when you can expect to receive products can now be longer or sometimes even unknown.
Although you can’t control the unknown, you can pay attention to what’s happening now, and have a backup plan in place for your business.
To ensure your inventory keeps up, you must be flexible and prepared for any obstacles that come your way. You need to pay attention to what's happening now, and what's happened in the past, to make adjustments on your marketing and the things that you're selling.
By tracking your inventory velocity, you can keep your inventory from reaching critical levels and even optimize your sales. Here are five tips to help you manage your inventory and optimize sales:
1. Know Where Your Inventory is Coming From
The first step to managing your inventory is understanding where it’s coming from. By knowing where your products are coming from, you can better track lead times and minimize the risk of not getting what you need, when you need it.
There are three main factors that affect lead time:
- Production process
- Inventory management
- Supply chains
Labor shortages have caused production to slow down, resulting in shipping delays globally. Some orders you may have had to place weeks ahead, you will now have to place months ahead.
Although some factors may be out of your control, it’s still important to shorten lead times when possible. This can boost overall productivity and increase customer satisfaction.
2. Know Your Customers
Accurately identifying your target audience and ensuring an appropriate marketing strategy makes it easier to push inventory. You need to clearly understand what your customer wants and when they want it. By understanding your customer, you can better sell the story of your brand.
Knowing your customers is also important for marketing segmentation. Knowing more about what your customers like and their purchasing habits allows you to tailor your content accordingly to different groups of people.
Creating a buyer persona is one of the most effective ways to make sure you know your customer. We understand that creating a buyer persona takes a lot of time and research, which is why many businesses work with a consulting agency.
3. Don't Forget About Seasonal Inventory
It’s important to plan ahead when strategizing how to buy and manage seasonal inventory. By planning ahead you can ensure you don't miss out on the product’s optimal selling window. It’s always a good idea to look back at past sales trends to ensure you don’t over or under order.
You may also run into cases where seasonal products don’t sell as quickly as you originally thought, despite past trends. This gives you the opportunity to run special campaigns toward the end of the season to move as much product as possible.
Or even better, you can expand the product's sell time by figuring out innovative ways to market the product across multiple seasons.
4. Keep Up or Get Ahead of Competitors
It’s important to be aware of what your competitors are doing in order to know what’s working in your industry. Pay attention to their storefronts, social media channels, and what technology stacks they are using. By knowing what’s working, you can adapt your sales and marketing strategies and strive to get ahead of your competition.
While pricing may be the most obvious way to compete with competitors, time and service are often just important. Businesses should focus on at least two of these elements to stay competitive in the busy market.
Shipping speed is a key factor for many shoppers when deciding whether or not to shop with an e-commerce brand. Quick turnaround time is crucial for companies to compete in today’s market.
While fast delivery should be a priority, supply chain issues can sometimes make this close to impossible. This is where customer service comes in. While these issues do arise, it’s important to handle these situations transparently and with empathy.
The COVID-19 pandemic has shifted buyer’s behaviors. There is now a much larger emphasis on making purchases online. This has directly impacted the way companies handle customer service. Great customer service can result in higher sales, higher customer retention, and brand awareness.
Even if you don’t have the means to have a customer service representative available 24/7, you can still provide great customer service. There are many ways to make it easy for customers to contact you, including:
- Phone number/email on website
- Live chat
- Contact Forms
- Social media
It should always be easy to contact your customer service team. No matter what your team’s preferred method of communication is, it should be evident on your website or marketing materials.
5. Always Keep Customers Top of Mind
Raising prices can at times be inevitable, and that’s okay. What matters is that you still show your customers that you value them. Initially after prices go up, you can offer sales to mirror the increase.
For example, if you increase a product’s price by 5 percent, you can offer a 5 percent discount site wide to help mitigate the increase. Even just a small discount can help minimize the sticker shock, help encourage conversion, and maintain loyal, happy customers.
Can’t afford to run discounted campaigns? There is still an opportunity to run successful marketing campaigns. One great way is to advertise new arrivals. This is a great way to draw customers to your website to check out new products. This also keeps customers confident that you are actively restocking inventory and thriving, even through supply chain challenges.
We know you want to create the best online shopping experience for your customers. By being proactive and understanding what inventory you need, you can not only save your business money but also ensure you can always fulfill your customer’s needs.
Knowing what you have, what you need, and how to manage the supply chain properly is the key to a successful business and happy customers.
Ready to optimize your sales? We are now accepting applicants to be eligible for our Strategy Workshop. Apply now!