Manage inventory Amazon

Manage inventory Amazon: The Perfect Guide 2021

Are you looking to manage your inventory on Amazon? If so, this article is for you. Here you will find five possible ways to manage inventory Amazon.

  • 1. How Does Amazon Manage Inventory?
  • 2. Why is Inventory Management Important for Amazon Sellers?
  • 3. 7 Tips to Improve Amazon Inventory Management
  • 4. Choose your Dropshipping Suppliers Wisely
  • 5. Final Thoughts About Manage Inventory Amazon

As an experienced Amazon seller, you need to put each of your items away. You need to do this so that you don’t run out. Arranging the right amount is also crucial, as ordering more can prove costly.

Amazon has completely changed the online retail advertising game for Amazon sellers. Many businesses have yet to find an online web business site.

Amazon, on the other hand, has excelled in this area. It has achieved such a high level of skill in such a limited amount of time. Amazon has focused all its efforts on Amazon Inventory Management services.

Amazon Inventory Management enables sellers to keep their items in stock. However, it includes more than just the basic holding items and listing products.

It is necessary to gain an edge in order volume, cash flow and forecasting throughout the cycle. It helps sellers stay at the top of Amazon search listings and increase sales.

It likewise finds your inventory needs and forecasts FBA sales and profits. Their services prevent expensive out-of-stocks. They are all designed so that sellers can focus on other essential parts of their business.


How Does Amazon Manage Inventory?

Numerous retailers, both brick-and-mortar and online, do not operate their own warehouses. While they may have their own private space, their important items are kept in a warehouse space. They rent or lease these spaces.

For Amazon, this is not a problem. Amazon stores most of the stuff on its base, and so does what the organization sells on its platform.

At the end of the day, the organization handles a huge measure of space. By the end of 2018, Amazon claims 288 million square feet of space, including warehouse space. About 66% of that property was built in North America.

When selling goods on Amazon, you have two decisions to make. This is FBA (serviced by Amazon) or FBM (serviced by the merchant).

The seller’s size, capabilities and strategy determine the relationship between the two. Clarifying the goals of the program may also be a driving factor in choosing a channel.

FBA Inventory Management

Amazon’s FBA fulfillment technology allows your items to go to Amazon for fulfillment. Amazon staff will take over from that point. They will handle everything related to the product.

It helps you to put away your goods for any period of time, pick the goods for the order, and convey them to the buyer.

This straightforward, effortless help is enjoyable, but it doesn’t come without a price. FBA is an extraordinary answer for organizations that need an extra hands-off approach. They will discover that managing large quantities of items can prompt a better edge.

Pros of Using FBA

  • Being prime-eligible opens you up to more buyers and orders. It is because customers love the one-day or two-day delivery guarantee.
  • It turns out to be a lot simpler to vie for the Buy Box.
  • You do not need to stress over how to store your goods.
  • Customer care and returns are likewise dealt with by Amazon. In that way, you can dedicate that time to something different when beginning to sell on the web.
  • You are naturally qualified to utilize FBA in Canada, the United States, Europe, and Japan. The service can be applied to transport globally, as well. You can even use FBA on non-Amazon orders.
  • Amazon is the biggest transporter on the planet. So, the cost to dispatch items can be decreased.

Cons of Using FBA

Fulfillment Fees

Since Amazon controls the chain, there are charges for dealing with your item. That can be a significant expense for small vendors.

Long Term Storage Cost

Amazon will include extra delivery charges for items that sit in the warehouse for longer than a half year time. The amount charged depends upon the square feet of the area used on the rack. However, small items with quicker inventory turnover rates are not in danger.

Private Labeling

Amazon’s distinct names should be applied to the item by the merchant or by Amazon marking administration.

No Control

You do not have any control over how it is picked, packed, and delivered.

Suggested reading:Amazon FBA Shipping: The Complete Guide

FBM Inventory Management

With Amazon FBM, you are liable for the total fulfillment measure. That can be gainful or extremely grave, contingent upon what you sell and your character as a dealer.

FBM is more qualified for niche brands with specific product contributions. It is also suited for built-up dealers with a current chain.

FBM is unusual for larger than average items, sluggishness, or item testing, where large profits are not necessary.

Pros of Using FBM

  • You oversee inventory stockpiling and the fulfillment cycle of your goods. It implies that you can bring down your expenses in case you can find deals.
  • You will additionally pay lower charges to Amazon since you are accountable for your items.
  • It is advisable to sell on a larger number of channels or places than just Amazon. Since being accountable for fulfillment makes it a lot simpler to pile up goods and track inventory.
  • How you pack the products is up to you, so you can get truly innovative with this and can concrete your image.

Cons of Using FBM

Since you have a restricted association with Amazon, your items will not be Prime-qualified. It will additionally be a lot harder to go after a Buy Box.

Be cautious about how you present delivery costs. The best technique is to work it into the item cost and promote free delivery, yet that is not generally possible.

If not, present your buyer with a few delivery choices and expenses. You can risk buyers being turned off by longer delivery times.

You can reduce the risk if you focus on tending to that with whatever fulfillment strategy you pick.


Why is Inventory Management Important for Amazon Sellers?

Inventory Management has a tremendous amount of capacity to support any seller. It assists those who are just beginning up as those on their 1,000th item.

It supports almost all of its users in an ideal manner. The following are the benefits of using that service:

Know Your Stock Status

Are you understocked, overloaded, unavailable, or on the spot? In light of your lead times and deals, the Inventory Manager refreshes you on your stock status for every individual item.

Prevent Stockouts

Running out of stock can decrease your Amazon FBA item status. You can lose your position on the Amazon searched keywords.

This can risk vanishing the items that your clients have in their carts. Inventory Management predicts the ideal time for you to reorder, keeping your things right where they need to be.

Reduce Inventory Costs

The expense of inventory is the carrying cost of the products over a specific time. It is determined to decide the amount of benefit a business stands to pick up.

It additionally causes you to determine the amount of inventory you need to fulfill the order.

The types of inventory costs are:

  • Purchasing costs
  • Taxes
  • Labor costs
  • Obsolescence
  • Insurance
  • Security
  • Transportation and handling

Using inventory management reduces costs in the following ways:

  • Organized warehouse to store your goods
  • Gets rid of obsolete stock
  • Reducing Lead Time
  • Tracks inventory KPI
  • Accurate forecasting

Reduce Inventory Losses

Inventory loss refers to the loss, looting, miscalculation or damage of products in the warehouse. Inventory loss can likewise be the effect of incorrect active inventory.

A range of causes, from robbery and breakage to return guarantees, can destroy its inventory. Inventory loss, also known as shrinkage, is the percentage of how much of the index does not reach the customer. It is difficult to eliminate shrinkage.

Therefore, directors should check shrinkage with the ultimate goal of monitoring it. Sending the wrong things to customers can have a downward impact and prompt shrinkage. Using Amazon inventory management can reduce losses to a great extent.

Forecast Sales and Profits

You need to anticipate how much inventory you will need when you put in an order. That is called inventory forecasting.

Forecasting puts together your reorder amounts about your business patterns. The Amazon Selling Coach is an incredible service for forecasting your reorder needs.

You have to apply your instinct and experience when setting orders dependent on forecasted numbers.

Occasional interest, holidays, and patterns can influence your product needs up or down. You ought to think about the entirety of this, alongside lead times, in your cycle.


7 Tips to Improve Amazon Inventory Management

The following seven tips will help you improve your Amazon inventory management:

1. Use Amazon Inventory Management Tools

You can improve your inventory management through the use of several tools. They have been given such to assist you in your business models. The following five tools are best suited to help you out:


Sellbrite is a simple to-utilize service that causes you to build, oversee, and start your FBA business.

It helps you develop your business over different online deals channels. It includes Amazon, eBay, Walmart, Jet, Etsy, Sears, Rakuten, and Newegg. This is all from an intuitive interface that you will like utilizing.

Sellbrite gives you a more intelligent approach to make and oversee listings. It also controls your product inventory. Sellbrite also places orders over all of your online sales channels.


Orderhive is simply an incredible inventory management tool. It assists you with following orders, controls inventory, makes deliveries, raises buys, and more. It has an automated workflow for better control over your purchases.

Orderhive assists venders to smooth out their order work process. It has a free trial and demos accessible. The free trial includes all the features. It is ranked 5 stars at major review sites by its users.


There are two adaptations of Sellics, one for Seller Central and one for Vendor Central. Each one applies to various merchants’ needs.

You can discover incorporate some common things between them. It includes a PPC manager, ranking optimization, competitor monitoring, and data analytics. Every one begins off with a 14-day free usage period.


Veeqo is an across the board internet business stage that causes you to deal with your whole backend. Use Veeqo channels to oversee orders, boat to clients, and sync inventory.

You can sort out, pick, and pack your items. You can also manage items and increase significant insight to help your business develop.


Expandly empowers you to deal with your Amazon inventory, postings, orders, labels, and detailing. It does so for all your sales channels only from one single dashboard.

You can view your continuous inventory across online commercial centers. It rapidly updates stock levels and effectively coordinates Amazon with Xero.


2. Understand your Inventory Turnover Rate-Payability

Payability is the most straightforward approach to changing your Amazon deals into day by day pay.

It is anything but an advanced help that tracks your Amazon deals and stores your daily incomes. Payability transforms your payouts into day by day.

Hence, you have command over your income. It stores into your bank account or onto a prepaid MasterCard.

The staying 20% is held in a hold to cover returns. That 20% is delivered to you on Amazon’s customary 14-day installment plan.

The main expense related to Payability is a 2% level charge on your gross deals. Many clients pick to take their payouts on Payability prepaid MasterCard on the grounds.

It offers 2% money back on buys, countering the Payability expense. Payability has no startup charges or dropping expenses. The two main prerequisites are:

  • You will be selling on Amazon for more than 90 days.
  • You average $2,000 in deals every month on Amazon.

The upside of utilizing Payability is that you approach your money as you gain it. It is much the same as a normal web-based business vendor.

By doing so, you can buy and turn your inventory quicker to get more cash-flow on Amazon. More than 1500 sellers use Payability to help scale their Amazon organizations.

Credit Cards

A credit card is another simple way to fund your Amazon inventory buys in the middle of your deal payouts. However, be careful!

Credit card charges have an annoying habit of piling up rapidly. If you are not cautious, the interest cost of having your balance for only a couple of months can whittle down your Amazon sales margin.

So, if you go for the credit card course for your business, keep a close eye on your parity.

Another issue with credit cards is that you can hit your limits at precisely the wrong time. Credit card limits can ruin your capacity to reorder stock varying quickly.

You either need to broaden your goals, which card organizations will not generally do. Another way is to pay down your credit card to account for the new charge.

Vendors who depend on credit cards to oversee Amazon inventory face two issues. But matching credit cards with Payability can make it work since you can square away balances quicker.

If you are cautious, you can make credit cards work for your potential benefit. A few organizations even figure out how to finance their startup inventories only on credit cards.

The stunt is moving the credit between two credit cards that offer 0% interest on fund transfers for more extended periods.

This must be all around overseen. If not, you can wind up owing enormous adjustments and piling up interest.

Loans or Lines of Credit

The third way that Amazon sellers fund inventory buys is through business loans or lines of credit.

Loans and lines of credit offer lower financing costs than credit cards, yet they can be hard to get, particularly for a startup.

You will have to give tax reports, salary details, and monetary records. Along with that, the lone comes after you have been selling for quite a while.

Another disadvantage is that loans and lines of credit are anything but hard to spend today, but it can be hard to repay tomorrow.

They are truly best for a setup business with a record of profits.  Amazon Lending is another alternative that enables Amazon sellers to support their inventory.

In any case, you do need to be a setup Amazon seller since the credit sums depend on your running Amazon sales volume. Also, you are confined to buying Amazon inventory as it were.


3. Understand your Supply Chain Lead Times

Vendors have various methods of sourcing items to sell on Amazon. So how you restock your Amazon inventory and what amount of time it requires to show up relies upon your specific sales model.

If you are just beginning, here is a glance at five normal Amazon plans of action and ordinary inventory order lead times for each:

  • Overseas manufacturers: 4 – 8 weeks
  • Wholesale suppliers: 1 – 6 weeks
  • Retail clearance sales: 5 – 8 Days for FBA receipt
  • Multichannel Ecommerce Seller: 1 – 6 weeks
  • Private Label Importer: 4 – 8 weeks

4. Plan for Seasonal Sales Fluctuations

Business inventory management suggests you ought to have enough inventories in stock to take care of orders.

Here’s what these terms mean, and how Amazon can assist you with settling on cleverer inventory order choices:

Inventory Order Lead Time

Lead time is the time it takes for inventory to show up once it is regulated. The thought is essential.

When requesting new stock, you permit enough of an ideal opportunity for it to show up before you run out of your existing merchandise. Understanding seller lead times to assist the buyers in overseeing two inventory difficulties:

Not Over-Ordering

Ordering unnecessary stock ties up money in more inventory than you need. Realizing lead times encourages you to judge how often you have to arrange stock to cover orders over a set timeframe. It gives you an idea about the amount you have to provide each time.

Ordering Too Late

If you do not permit enough lead time when reordering, you risk hitting 0 inventories on Amazon before new stock shows up.

To maintain a strategic distance from these problems, you ought to follow your present inventory levels and deal volume. You must also parity this against your lead times for new inventory shipments.

Inventory Forecasting

You also need to forecast the amount of inventory you need to place an order. Forecasting tells you about the amount you need to reorder.

Amazon determines the amount of your current sales trend. You should not always follow the trend but look deep into the other aspects.

You should have a piece of knowledge about the peak sales time and season of your items before placing an order.


5. Consider Dropshipping as an Alternative to Stocking Inventory

Dropshipping is an alternative to stocking your inventory. It is a plan of action for you to begin an online business. It also offers items to your buyers without loading the things by yourself.

6. Be Strategic with Promotions and Sales

Having the right strategy for your business can do wonders. It is an essential step to improve your inventory management.

It helps you capture your customers’ attention. The following steps will help you to be strategic with your sales promotion:

  • Target the right audience for your business growth
  • Set measurable goals for yourself
  • Limit your availability
  • Promote widely, but wisely
  • Offer real value
  • Review your results

7. Slow Down Demand for Your Inventory When Needed

A decent sales technique is not to get the most extreme clients yet not to lose a solitary one. That leads to the consumption of most of your inventory.

In such a situation, every one of your items can not keep up with the order cycle. This may prompt negative audits because of delivery delays or unavailability situations.

You may complete your stock sooner than arranged, but this will indicate a falling impact on your future deals.


Final Thoughts About Manage Inventory Amazon

Inventory Manager is an incredible tool that can save you a lot of money, stay in stock, and earn more benefits. Dealing with your Amazon inventory relies upon numerous variables.

How you sell on Amazon, how you meet orders, and how you deal with your Amazon earnings all play into your inventory management choices. Whatever your business model is, you must comprehend the issues you face.

Controlling assets, utilizing Amazon free inventory management are principal parts of their program.

Amazon has assembled its online presence just based on giving clients loyalty and ideal delivery. Without legitimate Amazon Inventory management, this would not have been possible.

After reading this post, I hope you can get a lot of useful information for your business, if you have any questions, please contact us or leave comments below.

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