Tips for Amazon FBA Inventory Management

With more and more consumers buying goods and services online, e-commerce businesses have really grown over the last several years. Sites like Amazon make selling goods online easier for online sellers with the Amazon FBA inventory. So, what exactly is Amazon FBA? How do Amazon FBA sellers keep track of their inventory?


What Is FBA Inventory?


FBA stands for fulfilled by Amazon. When using Amazon FBA, sellers ship their merchandise to an Amazon fulfillment center. This enables Amazon to Amazon FBA inventoryfulfill, and ship the merchandise on behalf of the seller. Amazon has fulfillment centers all over the country, which is why they are able to deliver to deliver their 2 day expedited shipping for Prime members. Ever wonder how Amazon is able to fulfill orders so fast? Same day or next day delivery is possible because of the extensive network of fulfillment centers Amazon has set up.


How Does Amazon FBA Inventory Work?


Inventory is an important part of any store, brick and mortar or online. For Amazon FBA inventory, the process has a lot of similarities like if you were fulfilling the orders yourself, you just don’t have as much control because the inventory isn’t in your possession. To avoid running into fulfillment issues here are some things to keep in mind:


Set Pars – With Amazon FBA inventory it is important to set pars. You want to make sure you set minimum viable stock numbers, so you know when you need to replenish your product to avoid the loss of a sale. Amazon does not allow back-orders, so if you are out of a product you will lose the sale and your listing will go down. In addition, if you run out of a product too often it could affect your search results. It is important to keep in mind the mindset of an Amazon shopper, they want instant gratification with 2-3 day shipping. They don’t want to wait, running out of a product could affect your seller rating.Amazon FBA


Forecasting – Forecasting involves taking previous years sales, and predicting what this year’s sales are going to be. This way you can have the right amount of stock available. This can be challenging and intimidating. You want to get the number right and avoid having too little stock where you can’t keep up with demand, but also too much stock that just sits and holds your capital hostage.


Amazon FBA Inventory Tools – Amazon makes it really easy to keep track of your inventory. You can set pars, keep track of customers, and analyze product performance. This is incredible important for your forecasting.


Third Party Inventory Tools


There are a lot of options out there when it comes to inventory management software. What great about inventory management software is a lot of them allow sellers to manage their inventory for multiple sales channels from one location. This includes updating product information for sites like Amazon and Shopify, but also to own website. This helps automate and streamline the who sales process. Sellers can run reports and see which products are selling, which products are not, who their customers are, and so much more. Some great options for inventory management include: ChannelApe, Ordoro, and Delivrd. For more in depth information about these platforms check out our other blog “The Importance of Inventory Planning for Online Businesses”.


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Working with an accountant who specializes in Amazon FBA can make a huge difference. To learn more about Amazon FBA Inventory accounting subscribe to our newsletter.

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