In ecommerce, managing your inventory well is key to staying profitable—especially during busy periods like the holiday season. Take NatZen, for example, a brand that relies heavily on Christmas sales. Their founder spent years refining inventory management to avoid the costly mistake of overstocking, which often leads to discounting and shrinking profits.

If you’re making your products by hand like NatZen and want to streamline your stock management, this post is for you. I’ll also share an Inventory Checklist at the end to help you plan ahead for seasonal demand and beyond. Let’s dive into how to manage ecommerce inventory effectively.

What Is Ecommerce Inventory Management?

Simply put, inventory management is the process of keeping the right balance between stock and sales demand. It means avoiding too much unsold stock while making sure you don’t run out of popular items. For handmade businesses, this also includes tracking raw materials, finished goods, and planning storage and distribution carefully.

The 4 Essential Steps to Manage Inventory

1. Set Up Your Inventory System
   Start by cataloguing your products and choosing tracking tools or software suited to your business size. This helps keep everything organised.

2. Forecast Demand
   Look at past sales data, especially from busy seasons, to predict when demand will rise. This helps you prepare the right amount of stock without tying up cash unnecessarily.

3. Plan Stock Replenishment
   Based on your forecast, schedule your orders and production. Factor in supplier lead times and how long it takes to make your products.

4. Analyse Inventory Regularly
   Keep reviewing your stock to spot trends, identify your bestsellers, and adjust your purchasing accordingly.

3 Inventory Strategies to Consider

• Just-In-Time (JIT): Keep low stock and order materials only as needed, perfect for handmade businesses to reduce holding costs.

• ABC Analysis: Categorise your products by importance and sales volume to prioritise what matters most.

• Dropshipping: If you sell non-handmade items, consider dropshipping to avoid holding inventory altogether.

Organising Your Stock

A tidy, well-labelled storage area speeds up packing and reduces mistakes. For NatZen, clear bins and pathways make busy seasons less stressful.

Managing Inventory with Excel

Excel is a handy and affordable way to track stock levels, set reorder points, and analyse sales trends. It’s ideal for small and medium businesses looking for a customisable solution without complicated software.

Inventory Checklist Essentials

Your checklist should include:

• Complete product catalogue with details (colour, size, category)

• Current stock counts

• Storage locations

• Reorder points to prevent running out

• SKU numbers for tracking and analysis

Final Thoughts

Getting your inventory right can mean the difference between a profitable holiday season and clearing out stock at a loss. For handmade businesses, balancing production with demand is crucial. NatZen’s experience shows how a well-managed inventory system supports growth and profit.

Use the strategies here, plus the Inventory Checklist I’ve included, to prepare for seasonal spikes and optimise your stock all year round.

Useful Resources to Start Managing Inventory

• WooCommerce Inventory Management Extension
  Streamline stock tracking, forecast demand, and automate reordering.

• Assisty AI Inventory Management
  Provides accurate sales forecasts and replenishment advice to reduce stockouts and excess inventory, helping you manage cash flow better.

Also, if you're ready to engage in deeper strategies, join our Soul-Led Ecommerce Facebook Group where you’ll get access to FREE bi-weekly website audits, exciting challenges, and trainings to help your product-based business thrive!
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