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Amazon Inventory Management: All you Need to Know!

Building an efficient online business requires proper tracking and control over the inventory management function. As a business expands its reach and engages new customers, the volume of orders increases. It is critical for the success of any business to keep up with the increasing demand and manage inventory accordingly. It is even more critical as a business expands into international marketplaces to build an e-commerce export business.

For instance, the business can either use its shipping arrangement or opt for the Fulfillment by Amazon (FBA) option. This will require a few changes to be made in the inventory management process that can have a deep impact on the export competitiveness of the organization.

What is Inventory Management?

Inventory is the stock a business is expected to keep to meet the expected demand from consumers efficiently. Inventory management is the process of handling the goods that may be ordered by consumers in the future.

It is not enough to have the right amount of amazon inventory management. A business also needs to keep it updated on the Amazon marketplace. The process includes handling the movement of goods from sellers to warehouses and then to the end customer.

It is not enough to have the right amount of amazon inventory management. A business also needs to keep it updated on the Amazon marketplace. The process includes handling the movement of goods from sellers to warehouses and then to the end customer.

A business needs to maintain a fine balance between the demand and supply of goods for efficient inventory management. It also helps in better stocking and planning of products for a business.

For instance, let us say a business is preparing for increased demands during the Amazon Prime Day Sale in the USA. It is a good idea to keep a track of the bestseller products and keep them in the inventory.

An inventory management system helps a business:

1.   Avoid a situation of high or low stock

2.   Ship the products on time

3.   Avoid product spoilage

4.   Seamless tracking of products

Inventory management can be done in a variety of ways. A business can keep a manual count with a ledger, use an automated digital solution like Amazon’s inventory management system, or rely on a spreadsheet. The final choice depends on factors like:

·   Nature of the Industry

·   Size of the business

·   Nature of the products being sold

·   Logistics and selling channels being used

What is Amazon Inventory Management?

Amazon offers an integrated inventory management system for its Global FBA sellers known as the Amazon inventory management on Seller Central. The Amazon inventory system helps track sales, deliverables, inventory levels, and orders received on Amazon’s global marketplaces.

The dashboard is capable of sending a notification when inventory levels are running low for a business. In addition, it also suggests recommended inventory levels with demand forecasting.

The Amazon inventory management dashboard informs sellers about ageing stock alerts, sell-through rates, and actions a business can take for storage optimization. The analysis helps in tracking the stock of a particular product in international warehouses.

How does Amazon Inventory Management Work?

The machine-learning-based Amazon inventory management system is accessible to global sellers listed on the platform. It is a solution that considers information like the cost of goods sold, time for the shipment, and other data from the Amazon profile to arrive at optimal inventory levels and expected customer demand.

Inventory Performance Index (IPI) helps measure the inventory management efficiency of the seller. The IPI score is based on the time in which a seller can replenish stock for popular products, fix listing issues and maintain a stable inventory level.

E-commerce exporters that can achieve a strong IPI score pay less than 1% of the revenue as a storage fee. It also provides access to more storage space in Amazon fulfilment centres and reduces operational costs.

Benefits of Amazon Inventory Management

The key benefits of Amazon’s inventory management system are as follows:

Updated inventory levels

Amazon inventory management helps keep the sellers aware of the inventory levels that are updated with each sale.

Seamless tracking

Amazon inventory management helps to easily track and locate products within the Amazon warehouse.

Focus on core activities

A business can focus on core activities as the software can track and update inventory levels.

How to Effectively Manage inventory levels?

A business can follow the following steps to manage inventory levels effectively:

–      Maintain long-term relationships with suppliers

–      Monitor the sell-through rate of various products

–      Offer promotional prices to avoid the ageing of inventory

–      Check your margins

–      Get the popular products restocked quickly

–      Maintain at least four weeks of inventory cover

A planned inventory management system helps a business take its products to over 18 international Amazon marketplaces.

E-commerce exports with Amazon Global Selling

Amazon Global Selling is an e-commerce export business from Amazon that helps Indian sellers build an e-commerce export brand. It reaches 300 million international customers in major markets like the USA, UK, Australia, Singapore, and UAE among others.


  • What type of inventory management system should be used for Amazon’s global store?
    You can use the Fulfilment by Amazon (FBA) option and gain access to the machine learning-based Amazon inventory management.
  • What is the simplest way of handling inventory?
    Opting for Fulfilment by Amazon (FBA) and working with Amazon inventory management is the simplest way of handling inventory.


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