Managing Inventory on Shopify

Let’s be honest – inventory management isn’t exactly the most exciting part of running a Shopify store. But neglecting it is like playing a game of Jenga blindfolded – one wrong move, and everything could come crashing down! Whether you’re a small ecommerce business owner or a scaling brand, keeping track of your stock can mean the difference between thriving and drowning in a sea of unsold products. We’re help you navigate inventory management with some handy tips and a sprinkle of Shopify wisdom.

1. Set Up Your Inventory System (No, Seriously, Do This First)

Before we dive into the fancy stuff, let’s make sure the basics are covered. Shopify’s built-in inventory tracking is excellent, it’s the sidekick you didn’t know you needed. It helps you track stock levels in real-time, automatically updates quantities, and even lets you set up alerts when you’re running low… nobody wants to be the store that’s always out of the popular items.

• Head over to Products > Inventory in your Shopify admin (you know the drill).

• Make sure “Track Quantity” is turned on for each product you want to monitor.

• Set up low stock alerts so you’re not caught off guard with an empty shelf… or in this case page.

Pro Tip: If your products have variations (like sizes or colours), don’t forget to track each one separately. Trust us, it’s a lifesaver when your customers are hunting for that “red medium” instead of “large blue”.

2. Organise Your Product Information Like a Pro

You wouldn’t store your socks in the kitchen, so why would you have a messy product catalogue? Keep things neat and tidy by assigning clear names, unique SKU codes, and meaningful tags. This might sound like a chore, but it’s the secret sauce for smooth operations – and fewer headaches later on. 

• Unique SKUs: Give every product and variant a unique SKU to make them easily identifiable. This helps make sure when a customer orders you pack the right product.

• Smart Categories: Group products logically so you can find them faster than you find your phone when it rings.

• Consistent Naming: Stick to a format that’s easy to search and won’t leave you scratching your head in confusion. Think “Product-Size-Colour” (like "T-shirt-M-Red").

Pro Tip: (Yes another one)… Map out your stock structure on paper (or excel) before you start. That way you’ll have a consistent guide to follow and your whole team can follow it to keep things where they should be.

3. Get Fancy with Inventory Management Apps (If Needed)

Once your store starts gaining momentum, Shopify’s built-in features might start feeling like they’re doing half the job. That’s where apps like Stocky, TradeGecko (QuickBooks Commerce), and SKULabs come in. These tools give you superpowers like advanced forecasting, supplier management, and automated reordering.

• Stocky: Perfect for deep-dive inventory reporting and smooth restocking.

• TradeGecko (QuickBooks Commerce): Best if you’re going multi-channel and need something that plays well with accounting tools.

Word of warning: These apps are great! But use them with caution, otherwise you’re overcomplicating simplicity.

4. Use Shopify’s Built-In Inventory Reports (Your Data Is Your Best Friend)

Shopify isn’t just for making your storefront look pretty – it also packs some powerful reporting features. Three reports you absolutely should be checking out:

• ABC Analysis by Product: This breaks down your products by their contribution to sales, showing you which ones are the breadwinners and which might need some TLC (or a discount).

• Days of Inventory Remaining: Want to avoid running out of stock (or having a stockpile of products no one’s buying)? This report estimates how long your current inventory will last based on past sales. Super handy, right?

• Sell-through Rate by Product: This report shows how quickly your products are selling compared to the amount you have in stock. It’s a crucial metric for identifying which products are moving fast and which ones are just gathering dust. A high sell-through rate is a good indicator of strong demand, while a low rate might mean it’s time to rethink your stocking strategy.

Shopify Analytics: Explore the Shopify Analytics reporting section and find the reports that work for you. Understanding your stock and what’s happening with your store is massively important!

5. Regular Stocktakes (aka The Dreaded Count)

No one enjoys doing stocktakes, but it’s a necessary evil. Think of it as inventory’s version of spring cleaning – it keeps things fresh and ensures what’s in Shopify matches what’s on your shelves. Schedule these during quieter times, like Monday mornings (just kidding – who’s up for counting stock on a Monday?), and make it as painless as possible with barcodes that sync up with Shopify. 

• Use a barcode scanner that’s linked to your Shopify system.

• Train your team so they know the difference between counting stock and guessing (we’ve all been there).

• Schedule regular checks – whether it’s quarterly, monthly, or weekly, depends on how busy your store is.

6. Nail Your Reordering Process

If you’re constantly running out of best-sellers or drowning in piles of unsold goods, it’s time to revisit your reordering strategy. While Shopify doesn’t natively support fully automated reordering, you can set up reorder points using third-party apps to handle this for you. With the right setup, you can ensure you’re always stocked just right without having to manually check your inventory levels all the time. 

• Review Your Shopify Sales Reports: Use built-in reports like the ABC Analysis by Product or Days of Inventory Remaining to determine when it’s time to reorder. These insights help you set reorder points that make sense for your business.

• Set Up Reorder Points and Alerts: For a more hands-off approach, apps like Stocky or TradeGecko (QuickBooks Commerce) allow you to automate the process. These tools can generate purchase orders when stock dips below a set threshold.

• Account for Seasonality: Just because you’re set up to reorder doesn’t mean you can ignore the trends. Take note of seasonal demand so you’re not restocking snow boots in April (unless you’re in the Alps) or swimwear in December (unless you’re in Australia).

7. Say Goodbye to Dead Stock (We All Have It)

Not everything you stock is going to be a hit, and that’s okay. Dead stock – products gathering dust – can be a problem. Every now and then, it’s essential to give your inventory a good review and identify those slow movers. Instead of letting them sit there taking up valuable space and tying up your capital it’s important to actively manage them. Consider running clearance sales, creating product bundles, or offering special promotions to shift these items. After all, a little money in the till is better than no money at all, especially for products that aren’t moving.

The quicker you can free up that space, the faster you can reinvest in products that are in demand. Clearing dead stock also keeps your store looking fresh and relevant, reducing clutter and making way for items that have higher sales potential.

One effective way to tackle this is by using apps like Bold Discounts, which allow you to set up flash sales with ease. These tools let you quickly discount products and promote them across your store, helping you clear out unwanted stock and recoup some of that tied-up cash.

8. Managing Inventory Across Multiple Channels (Because You’re Not Just on Shopify, Right?)

Selling on Shopify, Amazon, eBay, and a pop-up shop down the road? It’s amazing for growth but a bit of a nightmare for inventory tracking. Shopify integrates with multi-channel apps like Sellbrite and Linnworks to keep everything in sync so you’re not accidentally selling the same item twice (awkward).

Inventory management definitely isn’t glamorous, but it’s the backbone of a successful Shopify store. By setting up smart systems, tapping into the right apps, and keeping an eye on your data, you can avoid the usual pitfalls and keep your store humming along smoothly.

Still feel like you’re juggling too much? Let us help. Get in touch with us at letstalk@usual.ie for friendly advice or support in setting up your Shopify store. We promise we won’t make you count stock!