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Amazon FBA Business Tips For Inventory Management

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Are you looking for Amazon FBA business tips to improve the quality of your inventory management? Then you’ve come to the right place since I’ll now share some golden strategies you can’t overlook with your next Amazon FBA order. These tips will help you make sure that you’re never out of stock while reducing the cost of your Amazon FBA storage fees. 

Almost 90% of orders are processed using FBA, which goes to show the popularity and viability of the service. Therefore, no matter what inventory management issues you’re having, it’s essential to remember that you can overcome them and have a successful Amazon business. 

Amazon FBA business Inventory Management Advantages

Now let’s look at some of the top reasons why you should pay attention to proper inventory management principles. These advantages can be the difference between having a successful and a failing company. 

  • More sales: if you manage to always stay in stock, then you’re not leaving any sales on the table. It ensures customers can always place orders from your Amazon product listing page. However, if you’re out of stock, then customers will buy from competitors and you’ll lose out on the sale. 
  • Maintain organic rankings: when your product listings have no stock, they will begin to lose organic rankings. That’s because there’s a lack of sales, and your metrics go down. However, there’s a grace period where your rankings don’t take a complete nosedive if you can get back in stock quickly enough. 
  • Storage fees: once you send inventory to Amazon FBA warehouses, you’ll begin to incur storage fees. However, these storage fees can get out of control if you send too much stock that’s not selling. That’s because Amazon wants to sell stock quickly and imposes penalties for slow-moving stock. 
  • Customer reputation: you don’t want to be the seller in your niche that’s constantly out of stock. That’s because you’ll begin to lose customer loyalty, and your sales will go to competitors that do a better job. 
  • Higher profitability: since you’ll pay lower storage fees, you’ll end up improving the profitability per unit. This is excellent if you have tight margins and every percentage point counts. 
  • Scalability: you’ll have a better chance of scaling your business if you can get inventory management under control. That’s because you need a large volume of stock to have a large Amazon FBA business. 

Amazon FBA Business Top Inventory Management Tips

Now let’s turn our attention to the best tips for improving your inventory management. These are useful for beginners to advanced sellers, so pay attention. Also, the cost and resources you pour into improving your Amazon FBA business inventory management will pay for itself in terms of more sales. 

Use Amazon Seller Software Solutions

You can take advantage of the many Amazon Seller software solutions on the market to improve your inventory management. This includes Jungle Scout, Helium 10, and ZonGuru. They allow you to link your Amazon Seller Central account. This ensures that accurate data about your stock inventory streams to those inventory management tools. 

Also, some services offer AI-based suggestions for when to reorder and how much. This helps you figure out the next step with your inventory management. However, most of these tools require a monthly subscription, so make sure you have the budget. 

Amazon FBA
Amazon FBA

Accountants and Freelancers

You can hire an account or freelancer to handle inventory management for you. These professionals have experience looking at the numbers and predicting the right amount of stock to record at the right time. 

It takes experience and trial and error to figure out how to manage stock. Therefore, outsourcing the task to professionals ensures you don’t make mistakes. You may think stock management isn’t a problem, but that can change as your business scales. When there are multiple products to manage, there’s a lot more complexity and money at stake. 

Also, these professionals can help you save money to avoid ordering stock levels you aren’t likely to sell in the near future. This also helps with cash flow problems. Hence, investing in their services might pay for itself. 

Educate yourself

Don’t want to pay for services or software to complete your inventory management? Then you can take the time to educate yourself on how to manage Amazon FBA inventory. There are different courses and other sources of information you can find to learn. Learning these skills will come in handy for any business owner.

Plan Ahead Of Time

The lead time is the duration between when you place an order, and it becomes available for customers to buy. This can take upwards of 1-2 months if you’re ordering products from Chinese suppliers. Therefore, you need to plan your order ahead of time to ensure it arrives on time. 

However, don’t worry if the stock arrives a few days too early or late. Nobody is perfect with inventory management, and unforeseen delays take place all the time. You simply need to be within the margin of error to ensure your business isn’t negatively affected. 

Products With Multiple Variants

Try to avoid selling products with multiple variants since that creates a lot of complications. For example, if you decide to sell shirts, you’ll need multiple sizes, such as extra small, small, medium, large, and extra large. That’s 5 variants, and the problem gets even worse if you want to sell multiple colors. Therefore, sticking with products with only a single variant helps simplify your inventory management problems. 

Amazon FBA Business Inventory Management Final Thoughts

To conclude, multiple methods exist for solving your Amazon FBA business inventory problems. Each has its own pros and cons you should consider before making your choice. However, with so many advantages of improving your strategy, it’s a no-brainer that you work hard to improve. 

Eventually, you’ll have a solution that works for your Amazon FBA business and helps you scale to new heights. With the right set up, there’s no reason why you can always be in stock without paying high storage fees at Amazon FBA warehouses. 

About Author

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Rick Mak

Rick Mak is a 30-year veteran businessman, having started, bought, and/or sold more than a dozen companies. He has bachelor's degrees in International Business, Finance, and Economics, with masters in both Entrepreneurship and International Law. He has spoken at hundreds of conferences around the world during his career on entrepreneurship, international tax law, asset protection, and company structure. Business Anywhere Editorial Guidelines

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