There is no question about it, working with a 3PL service company can help bolster any eCommerce business. In most cases, it is an expense that is worth every penny. That being said, there are numerous ways that merchants can keep the cost of their 3PL services as low and optimal as possible. In this article, we will explore 4 important eCommerce 3PL inventory management tips that can help eCommerce merchants save money on their services.
Only Store What You Need
This is critical. There are many ways to achieve this. The most important thing to understand is that eCommerce 3PL warehouses on not storage facilities. These companies set storage rates geared towards products that move. It makes far more sense to keep inventory in storage and ready to deploy to your 3PL service provider than it is to overstock and pay additional 3PL storage fees. In the next two tips we will explore two valuable WMS tools that will allow you to analyze your inventory levels to ensure you are only storing optimal amounts of products.
Warehouse Management Systems (WMS) such as 3PL Central offer users multiple methods to keep tabs on their inventory. First, you can set what is called a minimum storage quantity alert for each individual product SKU you are storing at your 3PL service provider’s warehouse. This means, that whenever an item SKU reaches a certain quantity level, the WMS will automatically send out an email to the email address you have designated alerting you. Typically merchants set this to a number that will give them enough time to replenish the SKU as needed. This can ensure that you will always have inventory on hand to allocate to your orders and it eliminates the need to over-stock your items.
Using WMS software, you are able to run inventory reports. These are detailed reports that outline the SKU activity in any date range you choose. With InterFulfillment’s software, you can export these reports for use in applications like Excel. Reading these reports can provide merchants with valuable insight on how to set up inventory replenishment systems that will ensure you only warehouse as much inventory as you need. This will keep storage costs down, thus saving you money.
Stay Extra Lean in the 4th Quarter
Finally, the 4th quarter is the holiday season. This has been established as the busiest quarter for eCommerce businesses. During this quarter, merchants can often have a tendency to overstock inventory at their 3PL partner’s warehouse facilities. As a deterrent, most 3PL service providers tend to increase their storage rates during these months. By running reports and understanding how much inventory you will need throughout this quarter, you can save money. However, be careful. Receiving timeframes can also be longer, so you want to be sure you have appropriate inventory quantity notifications in place as well. This will enable you to stay lean and have inventory on hand for what is likely your busiest sales quarter of the year.
We hope you found these inventory management tips helpful. Streamlining your inventory replenishment process using tools widely available in Warehouse Management Systems can really help merchants keep the cost of storage low and increase profits. Also, keeping in contact with InterFulfillment support, and alerting them of any inbound inventory can help ensure you will always have inventory on hand to get your items where they need to go!