To compete in the digital buyer’s world we live in, manufacturers, especially B2C and D2C brands, must be prepared to offer their products across multiple channels. The convenience of online shopping and the various online marketplaces, social sites, and Ecommerce websites consumers browse and shop on is ever increasing.

The challenges of having too much inventory, too low of inventory, and preventable returns, the combined impact of equals nearly $2 trillion in mismanaged inventory costs, are amplified when managing inventory across multiple channels.

  • Overstock inventory accounts for $471 billion
  • Out-of-stock items accounts for $634 billion
  • Preventable returns accounts for $642 billion

Surprisingly, as much as 55% of ecommerce brands are still attempting to manage their inventory through manual processes like Excel, or even pen-and-paper. If you’re still managing your inventory in these ways, how much more challenging it is to attempt to throw in the dynamics of multichannel sales and inventory management. According to research done by Capgemini:

  • 28% of companies lack inventory visibility across stores, warehouses, and vendors
  • 34% of companies lack necessary software integrations
  • 38% of companies lack order management, inventory management, point-of-sale (POS), and third-party logistics (3PL) software

According to a 2018 Global Supply Chain survey report by eft (eyefortransport), a number of the biggest challenges’ companies are facing when it comes to B2C eCommerce involve various logistics of inventory management. Multichannel inventory management is one of the top challenges, along with streamlining the online sales process, working with logistics partners, coordinating suppliers, returns management, and too much inventory are all common challenges.

For smaller brands, and especially for fast growing brands who manufacture their own products, these challenges can feel incredibly difficult to get their arms around. And if they don’t, they can face a number of dire consequences that could lead to becoming part of the business failure statistics.

What is the biggest challenge your organization is facing when it comes to B2C e-commerce?

Multichannel inventory management  - What is the biggest challenge your organization is facing when it comes to B2C e-commerce?


The reality is that consumers aren’t very forgiving when products they’re interested in are out of stock, when they experience order delays due to inefficient fulfillment processes, especially if orders end up getting canceled that were placed through an online channel that turns out to be out of stock. They simply take their business elsewhere.

Efficient multichannel inventory management requires real-time and automated communication between the order channel, (your ecommerce site, marketplace, etc.), and your warehouse before an order is ever placed, and on all the way through to order fulfillment.

Each multichannel purchase has to know what’s in stock, where inventory is located, which warehouse with inventory is closest to the customer, and be able to track that inventory through order fulfillment all the way to the point of being in the customers hands.

But it’s not just the movement of inventory that needs to be managed. You also need to know

  • What inventory has a low turn-over rate so you’re not sitting on inventory that’s tying up cash
  • What inventory has a high turnover rate and automate triggers and processes to make sure you’re able to maintain inventory levels sufficient to keep up with demand
  • Average order size
  • Margins and Profitability

Being able to track and manage these things has become ever more important during the current recession caused by the COVID-19 pandemic. Major challenges, like a 31% decline in the average order value (AOV) many online brands have faced can severely cripple operational cashflow.

In addition to increased tariffs on oversea goods that many manufacturers depend on, supply chain challenges disruptions have made it that much more difficult to manage adequate inventory levels.

These challenges make it all that much more important to leverage automation in your multichannel inventory management to keep up with and get ahead of the challenges of building and growing your business.

In order to grow and scale your business, you must get ahead of these costly challenges through multichannel inventory management automation. If you do, you will have a significant competitive edge over at least 55% of brands still managing inventory the old fashion way.

Multichannel inventory management requirements to scale your business

The goal here is to reduce the workload of manual processes done by multiple people that are inefficient, error-prone, and unreliable. When you have to manage inventory separately by different locations and different channels, and then attempt to sync them together in a spreadsheet, or even across multiple spreadsheets, or worse yet via pen and paper, you’re guaranteed to have limited ability to grow and scale your business.

Many multichannel inventory management solutions today are even cloud-based and powered by artificial intelligence (AI) with the ability to automate processes and workflows. They can:

  • Automate and streamline workflows
  • Automate tracking, managing, and optimizing inventory levels.
  • Let you know which products you need to run a sale to get rid of
  • Which products are turning fast
  • Reorder levels, and even automate reorders of supplies or products needed to keep popular items stocked.
  • Help you know which products are performing the best on various online channels.

In short, the right solution can save you significant time and overhead enabling you to focus on other key areas of growing your business. In Part 2 of “How Automating Your Multichannel Inventory Management Will Scale Your Busines”, we’ll look closer at specific ways cloud-based multichannel inventory management software does this.