Too Many SKUs? Addressing Inventory Issues With Ecommerce Inventory Management Software

As businesses scale and inventory grows more complex, advanced tools are needed to solve issues before they happen.

By Tom Wintaugh | June 9, 2023 | 3 minute read
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Scaling up sustainably is a primary concern of every business, but what happens when more scale creates more complexity and volume in your product inventory? Many sellers are able to achieve initial success with smaller product offerings, and it’s natural to add more products with increasingly specific relevance to your audience in order to build on that success. But with a larger product catalog, ecommerce processes can become more complicated as well, leading to extra costs, extra time, and extra hassle for sellers. When inventory becomes too large and complex for entry-level ecommerce platforms, it's time to leverage advanced ecommerce inventory management software and techniques.

What Drives Increasing Inventory Complexity

The expansion of product lines, diversification of suppliers, and integration of resource management systems are all key factors that might drive increasing inventory complexity. Often, businesses will discover that their customers have a more specific product need which needs to be met, or find that competitors are turning up the heat with new offerings.

Adding new product categories or subcategories to your ecommerce platform can result in far greater number of SKUs. As a result, tracking, selling, and fulfilling a greater number of products often multiplies issues when there are  fluctuations in supply & demand, impacting sellers' capacity to maintain optimal stock levels. Effective ecommerce merchandising is also increasingly complicated as businesses' SKU counts grow.

Industries with Complex Inventory Handling Needs 

Some industries inherently require intricate inventory management due to the nature of their products. Sellers of premium electronics, food and beverage, or pharmaceutical products, for example, each deal with a wide array of products having different specifications, safety requirements, and legal compliance issues. Meeting these unique needs may be manageable with a small product catalog, but at larger scale will necessitate meticulous inventory organization and data communication just to meet day-to-day selling operations. 

Challenges of Organizing Large Inventory on Customer-Facing Websites  

Managing the organization and promotion of large inventories on customer-facing websites can be quite a challenge. Adding scale to your SKU count must be paired with a thoughtful user experience which makes it easy for buyers to see all of their options and sort through massive catalogs intuitively. It is important to ensure that your product selection is easy to navigate and that products are categorized accurately, especially for larger businesses. Otherwise, customers may struggle to find what they're looking for, leading to lost sales and more excess inventory left on the shelf. 

Managing Orders and Fulfillment with Large Inventories 

As the number of SKUs increases, so does the complexity of order management and fulfillment. This can lead to issues such as over-stocking or under-stocking, both of which can impact customer satisfaction and your bottom line. Furthermore, dealing with dependent SKUs and "child" SKUs, which can cover product variations or seasonal availability, adds another layer of complexity. 

Growth Strategies For Successful Brands

How to Leverage Ecommerce Features to Manage Inventory Better and Increase Sales  

Modern ecommerce platforms offer many features which can streamline inventory management. By driving efficiency in the ordering, handling, and tracking of inventory, sellers can reduce overall operating costs and protect against inventory issues before they happen. 

  • Forecasting Tools: Use forecasting tools like predictive inventory calculators to predict future demand and sales, helping you determine how much inventory to order.
  •  Automated Reordering: Automated reordering systems can be configured to be triggered by stock levels to ignite the reordering process, or inform managers that orders need to be placed.
  •  Inventory Tracking: "Real-time" inventory tracking data provides up-to-the-minute information about availability, product location, and stock levels for your ecommerce team, as well as for your customers. 
  •  Multi-Channel Management: Products that sell to different channels might nonetheless require unique pricing, product content, and promotions which all add complexity. Use a system that can manage inventory across multiple sales channels.
  •  Integration with Other Systems: Many other data systems can help manage the movement of large inventories, including order management systems, warehouse management systems, and ERP resource planners. The more your central ecommerce operations can utilize this data and communicate with these systems, the more control you’ll have over inventory issues. We took a deep dive into ecommerce integrations here.

Add unlimited SKUs and grow your inventory—as long as your ecommerce platform can handle it 

When searching for the best way to wrangle high SKU counts, look for ecommerce inventory management software and platforms which offer scalability, real-time tracking, and integration with other inventory-adjacent platforms. Managing a large and complex inventory can be daunting. However, with the right ecommerce inventory management software, you can effectively handle more SKUs, prevent inventory issues, and optimize your ordering process. The result: improved sales, and satisfied customers.

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About The Author

Katy Ellquist

Katy Ellquist, Miva’s Digital Marketing Strategist, is an accomplished writer, marketer, and social media analyst who has created sophisticated content campaigns for a broad range of professional clients. She brings to Miva a complex understanding of ecommerce trends and techniques, building upon extensive digital agency experience and a prior role as direct liaison to Miva’s top accounts. Katy is a regular contributor to the Miva blog, covering essential ecommerce topics like design & development strategy, site optimization, and omnichannel selling, with the goal of increasing the actionable knowledgebase of the entire Miva community.

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Author's Bio

Tom Wintaugh

Tom is a Content Marketing Specialist at Miva.

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