Ecommerce

Reports and Automated Workflows to Manage Amazon Inventory

Aditi Sinha

March 19, 2024

Amazon Inventory Planning Report and alerts

Benefits of Inventory Management on Amazon

Inventory management is crucial for any D2C e-commerce business, including those operating on platforms like Amazon. Here are some reasons why effective inventory management is important for sellers on Amazon, along with its benefits:

  1. Optimized Stock Levels: Maintaining proper inventory levels ensures that you don't run out of stock or have excess inventory sitting idle. This helps in maximizing sales opportunities while minimizing the costs associated with overstocking or stockouts.
  2. Improved Customer Satisfaction: By having the right products in stock at the right time, you can fulfill customer orders promptly. This leads to higher customer satisfaction and positive reviews, which can result in repeat business and increased brand loyalty.
  3. Reduced Costs: Efficient inventory management helps in minimizing storage costs, carrying costs, and the risk of obsolete inventory. By accurately forecasting demand and managing inventory turnover, sellers can reduce the costs associated with holding inventory for extended periods.
  4. Enhanced Visibility and Control: Proper inventory management provides sellers with real-time visibility into their stock levels, sales trends, and inventory performance. This allows them to make informed decisions regarding purchasing, pricing, and promotions, thereby exerting greater control over their business operations.
  5. Increased Profitability: Ultimately, efficient inventory management leads to increased profitability for sellers on Amazon. By minimizing costs, maximizing sales, and optimizing inventory turnover, sellers can improve their bottom line and achieve greater financial success on the platform.

How is Amazon inventory managed today?

Method Description Example
Amazon Seller Central Amazon's proprietary platform for sellers to manage inventory, product listings, orders, and sales. It offers inventory tracking, order management, and reporting tools. Sellers use Seller Central to list products, monitor sales, and adjust inventory levels based on demand.
Inventory Management Software Third-party software that integrates with Amazon Seller Central, offering features such as automated order processing, inventory forecasting, real-time tracking, and centralized management of multiple sales channels. Examples include: TradeGecko, Sellbrite, Skubana
Warehouse Management Systems Systems used by larger sellers or those with fulfillment centers to streamline warehouse operations, including inventory management, order picking, packing, and shipping. Sellers employ WMS like Fishbowl or Oracle WMS to optimize inventory storage and improve warehouse efficiency.
Order Management Systems Platforms that integrate with various sales channels, including Amazon, to centralize order processing and fulfillment, helping manage orders from multiple channels and synchronize inventory levels. Examples include: Unicommerce, Brightpearl, Skubana

Challenges in Amazon Inventory Management Today Include:

Overall, while there are various tools and technologies available to assist sellers in managing their inventory on Amazon, overcoming challenges such as:

Challenges in Amazon Inventory Management

1. Manual Processes:

Despite the availability of automation tools, some sellers still rely on manual processes for inventory management, such as exporting data from Amazon Seller Central and entering it into spreadsheets. This can be time-consuming and error-prone.

2. Reactive Approach:

Many sellers still operate on a reactive rather than proactive basis when it comes to inventory management. Instead of forecasting demand and adjusting inventory levels accordingly, they may wait until they face stockouts or overstock situations before taking action.

3. Lack of Real-Time Visibility:

Some sellers struggle with limited visibility into their inventory levels, especially when managing inventory across multiple sales channels. Without real-time data, it becomes challenging to make informed decisions about inventory replenishment and allocation.

4. The complexity of Multichannel Selling:

Sellers who operate on multiple sales channels, including Amazon, may encounter difficulties in synchronizing inventory levels and managing orders efficiently across platforms. Integrating inventory data from different sources and ensuring consistency can be a significant challenge.

5. Inventory Forecasting Accuracy:

Accurately forecasting demand is crucial for maintaining optimal inventory levels. However, many sellers struggle with predicting future sales trends and adjusting their inventory accordingly, leading to either stockouts or excess inventory.

What does a full-fledged reporting setup look like for Amazon Inventory Management?

A full-fledged reporting setup for Amazon inventory management typically consists of several components that work together to provide comprehensive insights, alerts, and task management capabilities. Here's how such a setup might look:

Reporting Setup needed for amazon inventory management

1. Data Integration and Collection:

The reporting setup begins with the integration of data from various sources such as Amazon Seller Central, third-party inventory management systems, and other relevant platforms. This could involve APIs, data feeds, or direct database connections to gather information on sales, inventory levels, order processing, and more.

2. Data Warehouse or Database:

The integrated data is stored in a centralized data warehouse or database. This centralized repository enables efficient storage, retrieval, and analysis of large volumes of data related to Amazon inventory management.

3. Reporting and Analytics:

Reporting and analytics tools are used to extract insights from the integrated data. These tools may include business intelligence platforms like Tableau, Power BI, or custom-built dashboards. Sellers can create custom reports and dashboards to visualize key metrics such as sales performance, inventory levels, profitability, and more.

4. Advanced Reporting Features:

The reporting setup includes advanced features such as customizable reports, drill-down capabilities, and interactive visualizations. Sellers can analyze historical trends, identify patterns, and gain actionable insights to optimize their inventory management strategies.

5. Alerting Mechanisms:

Automated alerting mechanisms are set up to notify sellers of critical events and anomalies in real-time. Alerts can be triggered based on predefined thresholds or conditions such as low stock levels, out-of-stock items, sudden spikes in demand, or fulfillment issues. These alerts help sellers proactively address potential problems and prevent disruptions to their operations.

6. Task Management and Workflow Automation:

Task management features are integrated into the reporting setup to streamline inventory management workflows. Sellers can create and assign tasks related to order processing, inventory replenishment, shipment tracking, and more. Workflow automation tools automate repetitive tasks, reducing manual effort and improving operational efficiency.

Types of advanced reports you need for Amazon inventory management

Amazon Inventory Reports

Amazon Inventory Health Report:

  • Definition: Offers insights into the health of your inventory, including stranded and overstocked items.
  • Parameters: Inventory Status, Inventory Age, SKU, FBA/FBM Inventory.
  • Alerts and Automated Workflows: Alerts for overstocked or stranded inventory items. Automated removal orders for aged stock.
  • Template Link: Amazon Inventory Health Report

Amazon Inventory Report:

  • Definition: Provides detailed information on inventory levels and stock movements.
  • Parameters: Inventory Status, SKU, Date Range, Inventory Metrics (Stock Level, Inbound Shipments, Inventory Health), Sales Channel.
  • Alerts and Automated Workflows: Alerts for low stock levels or excess inventory. Automated replenishment orders based on inventory thresholds.
  • Template Link: Amazon Inventory Planning Report

Buybox Percentage Report:

  • Definition: Measures the percentage of time your product wins the Buy Box in comparison to competitors.
  • Parameters: Product ASIN, Buy Box Status, Competitor Pricing
  • Alerts and Automated Workflows: Alerts for fluctuations in Buy Box percentage. Automated repricing strategies.

Order Defect Report:

  • Definition: Calculates the percentage of orders with defects such as negative feedback, A-to-Z claims, or late shipments.
  • Parameters: Order Status, Defect Type, Seller Performance Metrics (Feedback Rating, On-Time Delivery, etc.)
  • Alerts and Automated Workflows: Alerts for spikes in order defect rate. Automated resolution workflows for customer issues.

Reporting doesn’t have to be this hard. Try the Locale way:

Reporting on Locale

As an Amazon merchant, you have two options for advanced inventory reporting and workflows:

  • The Old Way: Manually create reports, hunt down online templates, and piece together alerts and workflows across multiple tools.
  • Try Locale’s One Click Templates: Access 50+ pre-built, Amazon-specific reports. Get real-time inventory analytics with one-click integration. Automate alerts directly to Slack, email, or via webhooks for custom actions.

With Locale, we're introducing a robust reporting module designed to empower companies to kickstart their monitoring journey right from the beginning. Leveraging our seamless integration with various SaaS products, you can effortlessly generate reports, configure email/Slack notifications, set up alerts, and automate tasks with just a few clicks. Whether you're at the initial stages or further along in your journey, Locale serves as your comprehensive operations workflow tool, simplifying your monitoring and analytics needs.

With Locale, you can:

● Consolidate real-time visibility across all sales channels into a unified command center. No more blind spots.

● Flex reporting templates to your workflows, locations, and product lines rather than forcing you into a one-size-fits-all setup.

● Set intelligent alerts and triggers to automate analysis based on trends and KPI thresholds you define. Proactively stay ahead of threats.

● Develop enterprise-grade forecasting leveraging historical data to efficiently plan stock levels, transfers, and inventory investments.

Getting Started with Locale in <5 mins:

With Locale, you don’t have to settle for one-size-fits-all inventory management. As your strategic direction shifts, our flexible platform shifts with you.

1. Connect and Consolidate

Link data across over 50 databases and SaaS tools, bringing all your information into one accessible location.

2. Ready-Made or Custom Templates

Choose from our ready-made templates or tailor them to your unique needs using SQL.

3. Effortless Setup and Tracking

Establish reports, alerts, or automation processes, and effortlessly track their status until resolution.

Setup reporting on Locale

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