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Ecommerce Inventory Management System
Features, Integrations, Success Factors, Costs
ScienceSoft applies 20-year experience in digital commerce and 11 years of expertise in building inventory software to design and develop effective ecommerce inventory management solutions.
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Ecommerce Inventory Management Software: The Essence
Ecommerce inventory management software helps companies involved in digital commerce streamline inventory management workflows, minimize inventory carrying costs, and avoid stockouts and overstocking.
The software can enable demand-driven inventory planning, real-time monitoring of inventory levels and location using IoT, multi-echelon inventory optimization based on advanced analytics, automated inventory valuation, as well as automated inventory ordering and selling.
- Necessary integrations: online selling channels, a vendor portal, accounting software, promotion management software, etc.
- Implementation time: 6–10 months for custom inventory management software for ecommerce.
- Development costs: $90,000–$400,000+, depending on the solution’s complexity.
- ROI: 120–300%+.
There are two ways to manage inventory: with a reactive approach, a company responds to the customer demand, and with a proactive — it predicts the demand. The second model is more financially viable, as the company can plan sufficient stock to meet customer demand and have little or no stale stock that will be sold at a discount or disposed. To build proactive inventory management systems, we rely on advanced analytics and AI. So, the system can analyze relationships between multiple variables (e.g., past sales, seasonality, planned advertising and pricing promotions, safety stock) and make as accurate demand predictions as possible.
Ecommerce Inventory Management System: Key Features
ScienceSoft creates inventory management solutions with unique functionality closely bound to our clients’ objectives. Below, we list the features commonly requested by our customers from the ecommerce sector:
Inventory planning
- Calculating the required inventory amounts by period, inventory item, storage location, etc., based on the analysis of relevant historical data:
- Customer demand (by online selling channel, region, during particular seasons, etc.).
- Inventory expiration dates.
- Existing inventory reservations for customer orders, and more.
- Planning the expected inventory delivery dates based on the lead time specified by a vendor, inventory shipment status, working days calendar, etc.
Inventory optimization
- AI-supported calculation of optimal inventory reorder points for each inventory item based on historical sales data, product promotions, demand seasonality, and other factors.
- Multi-echelon inventory optimization based on the analysis of current demand, inventory availability, inventory carrying costs, inventory lead time, customer commitments and service levels, and more.
- AI-driven recommendations on the optimal time for inventory reallocation between different warehouses, distribution centers, points of sale (for omnichannel retail), etc.
Inventory purchasing
- Automated creation of purchase orders (PO) triggered by reorder points, certain dates, etc.
- Rule-based supplier assignment for various inventory items.
- Automated workflows for multi-department PO approval.
- Real-time PO status tracking.
- Automated purchase invoice processing and submission for payment.
Inventory receiving and putaway
- Alerts to the inventory team on inventory delivery.
- Inventory item identification and verification against purchase/transfer orders based on barcode or RFID technology.
- Flagging inventory items that require quality inspection.
- Automated generation of identification labels for inventory items, pallets, stacks, packages, etc.
- AI-based inventory storage suggestions based on the item storage requirements, expiration dates, demand forecasts, etc.
- Alerts on inventory items to be taken from a receiving zone directly to a shipping zone (for cross-docking operations).
Inventory control
- Inventory level monitoring based on barcode or RFID technology:
- Across multiple domestic and foreign storage locations.
- Across owned and consignment inventory.
- Alerts on low-level inventory.
- Batch control to track expiration dates (e.g., of perishable inventory items) using barcode or RFID technology.
- Reminders on inventory expiration dates.
- Inventory audit based on barcode or RFID technology.
- Template-based creation of sales orders.
- Rule-based customer order prioritization based on customer value, order date, product category, service level, and more.
- AI suggestions on the optimal order fulfillment location based on the analysis of current stock levels, destination addresses, etc.
- Template-based creation of order fulfillment schedules with critical milestones like order packing, pickup, arrival at particular points, etc.
- Real-time tracking of sales order status.
Inventory picking and packing
- Automated inventory reservation for a customer order.
- AI-based suggestions on the type and amount of packing required for an order and the optimal inventory picking route in a fulfillment location.
- Automated creation of picking and packing lists for warehouse workers.
- Rule-based inventory kitting.
- Template-based creation of shipping labels and package slips.
- Automated generation and approval of sales invoices and shipping documents.
- Notifications to the inventory team on the goods dispatch.
Inventory return management
- Rule-based inventory return routing to a fitting warehouse.
- Real-time tracking of return order status.
- Alerts to the inventory team on the returned inventory delivery.
- Automated workflows for various inventory processing scenarios upon returned inventory delivery (e.g., inventory routing for quality check or inventory return to the initial supplier).
Inventory analysis
- Real-time calculation of inventory metrics, such as total inventory levels by storage location, on-hand/low-stock inventory, inventory turnover, days sales of inventory (DSI), aged inventory, and more.
- AI-powered ABC and FSN analysis.
- Template-based inventory reports (by period, region, storage location, etc.).
Essential Integrations for Inventory Management Software
ScienceSoft recommends setting up the following integrations to ensure the accuracy and consistency of inventory data across business-critical systems. It will help facilitate and speed up ecommerce inventory planning, control, replenishment, and selling.
Online selling channels
(e.g., a company’s ecommerce website, social networks, third-party marketplaces)
- For the automated input of relevant data when creating sales orders and customer invoices.
Promotion management software
For accurate inventory planning taking into account potential demand spikes.
Vendor portal
- For the automated purchase order submission to suppliers.
- For facilitated PO status tracking.
- To precisely calculate expected inventory supply dates and optimal inventory reorder points.
Hardware
(barcode or RFID readers)
For accurate inventory level and location monitoring.
Transportation management software
To accurately plan customer order shipment.
Accounting software
For automated recording of inventory transactions and inventory value to the general ledger.
BI solution
For the analytics and visualization of multi-location data on inventory demand, inventory lead time, and more.
Success Factors for Implementing Ecommerce Inventory Management System
Relying on 20 years of experience in digital commerce and 11 years of experience in designing and building supply chain management solutions, ScienceSoft’s consultants have defined important factors that help ecommerce companies achieve maximum ROI from inventory management software implementation.
- AI-powered prescriptive analytics. To provide ecommerce inventory teams with intelligent recommendations, for example, on optimal inventory reorder points or inventory reallocation time to support optimal stock levels across various warehouses.
- The use of barcode and RFID technology. To eliminate error-prone manual inventory counting, enable automated tracking of inventory level and location.
- Smooth integration with business-critical systems. To ensure seamless flow of data between ecommerce inventory management software and a company’s online selling channels, a vendor portal, accounting software, a BI solution, etc.
Inventory Management Platforms ScienceSoft Recommends
Oracle NetSuite Inventory Management
Best for
Large ecommerce businesses with complex distribution networks.
Capabilities
- Template-based SKU creation.
- Demand-driven inventory planning.
- Calculating optimal stock levels across locations and reorder points for inventory items based on the analysis of historical sales data, inventory lead time, and other factors.
- Monitoring inventory levels across multiple locations in real time.
- Alerts on low-stock inventory items.
- Tracking the status of inventory purchase orders and sales orders.
- Automated processing of inventory returns.
- Analytics on essential inventory KPIs, such as total stock by location, best-selling and slow-moving stock items, etc.
Cautions
Requires substantial customization efforts to meet unique inventory management needs.
Brightpearl Inventory Management
Best for
Midsize and large companies involved in omnichannel commerce.
Capabilities
- Inventory planning based on the analysis of historical sales data and planned product promotions.
- Multi-echelon inventory optimization.
- Monitoring inventory levels across domestic and foreign storage and selling locations and inventory audit based on barcode technology.
- AI recommendations on the optimal time for stock replenishment.
- Automated generation of inventory purchase orders (triggered by reorder points).
- Template-based creation of sales orders and customer invoices.
- Plug-and-play integrations with Amazon, Shopify, Adobe Commerce (Magento), and other popular e-commerce platforms and marketplaces.
Cautions
Requires costly and effort-consuming integration with legacy back-office systems.
Veeqo Inventory Management
Best for
Midsize ecommerce businesses selling via multiple online marketplaces.
Capabilities
- OOTB integrations with popular e-commerce marketplaces (Shopify, Amazon, eBay, Walmart), e-commerce platforms (BigCommerce, Magento), accounting tools (Xero, QuickBooks), and more.
- A mobile app for inventory managers.
- Inventory planning by period, fulfillment location, region, etc., based on demand and lead time specified by a supplier.
- Tracking inventory levels across multiple storage locations, including trading partners’ warehouses, based on barcode technology.
- Rule-based routing of customer orders to particular fulfillment locations.
- Rule-based inventory kitting.
- User-defined rules for inventory picking and packing.
Cautions
SKU data has to be uploaded manually, which is time-consuming.
When to Choose Custom Software for Inventory Tracking and Management
ScienceSoft recommends building a custom solution in the following cases:
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Implementation Costs and Financial Outcomes
Ecommerce inventory management software can bring 120–300%+ ROI, depending on the initial project investments and ecommerce company size.
According to ScienceSoft’s experience, a custom ecommerce inventory system of average complexity requires $150,000–$250,000 in investments, while the cost of a comprehensive inventory and warehouse management solution for a large ecommerce business may reach $400,000+.
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Benefits of inventory management system for ecommerce
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10–30% decrease in inventory purchasing, holding, and shortage costs. |
90% fewer out-of-stock situations due to accurate inventory planning. |
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Over 25% improvement in inventory accuracy. |
10–15% reduction in inventory-related labor hours. |
Implementation of Ecommerce Inventory Management Software with ScienceSoft
In ecommerce since 2003 and in inventory management software development since 2012, ScienceSoft helps ecommerce businesses build reliable inventory management solutions.
Ecommerce inventory software consulting
- Analysis of your inventory management needs.
- Suggesting optimal features (including advanced techs-enabled features, such as AI-based prescriptive analytics)
- Design of a scalable architecture.
- Selecting a go-to tech stack for ecommerce inventory software implementation.
- Preparing a plan of integrations with online selling channels, a vendor portal, accounting software, RFID, or barcode scanners, etc.
- Implementation cost & time estimates, expected ROI calculation.
Ecommerce inventory software implementation
- Inventory management needs analysis.
- Ecommerce inventory solution conceptualization.
- Design of a scalable architecture.
- Inventory management software development.
- Integrating the solution with existing systems (online selling channels, accounting software, etc.), RFID, or barcode scanners.
- Quality assurance.
- User training.
- Continuous support and evolution (if required).
About ScienceSoft
ScienceSoft is an international IT consulting and software development company headquartered in McKinney, Texas. We provide consultancy and development services to help ecommerce businesses build effective inventory management software. Being ISO 9001 and ISO 27001 certified, we apply a mature quality management system and guarantee that cooperation with us does not pose any risks to our customers’ data security. If you are interested in getting a reliable inventory solution for digital commerce, feel free to turn to ScienceSoft’s team.