One of the most critical components in customer experience on the internet is having a low lead time between placing an order and receiving the product.

Thus, efficient inventory management becomes one of the integral components for success in this e-commerce jigsaw puzzle. In recent years, several direct-to-consumer e-commerce brands have flourished in India by banking solely on various inventory management techniques including the use of ERP integrations.

Top 9 Inventory Management Techniques for Business Scaling

Inventory management is important for businesses because it enables effective control and optimization of their stock levels. By keeping track of items, companies can prevent stockouts, reduce excess inventory products in stock, and enhance customer satisfaction by ensuring products are available when needed. 

In current times, when every brand is vying for the narrowing attention span of the customer and where the crowded marketplace makes it difficult for brands to stand out, efficient stock management techniques can enable you to build a solid case for your brand. You can leverage various effective inventory management techniques to build a successful business in 2024 

Let us look deeply into various types of inventory management methods and understand how you can build a competitively ahead business with stock management.

Types of Inventory Management Techniques

A business can adopt several inventory management methods, but accurate inventory is crucial for success Some of the most popular ones are as follows:

1. ABC Analysis

Under this method, the stock manager is expected to identify the most popular and least popular types of stock and manage the inventory control accordingly, taking into account inventory levels. This is useful for businesses that sell a wide variety of products at different price bands. It is particularly useful for businesses in fashion and entertainment, among others. 

 2. Just-in-time (JIT) Method

As the name suggests, you are expected to maintain the lowest level of stock possible under this method and expect the goods to roll in just before they are supposed to be dispatched. Toyota perfected this method as part of its car manufacturing process. While it can result in capital savings, it is a risky proposition to follow the JIT method, as an unexpected demand surge can cause a shortfall in raw materials. To mitigate this risk, it is recommended to maintain a safety stock of inventory, also known as the reorder point.

 3. Dropshipping

Under this method, businesses are expected to outsource all aspects of managing the inventory, including warehousing. This method has some benefits but is suitable for only some businesses that do not rely on efficient stock management as the success factor. It is particularly useful for businesses that want to get into e-commerce but cannot afford or justify the cost of a warehouse of inventory management. 

 4. Bulk Shipments

Businesses following this technique assume that bulk buying is always cheaper. This is good for businesses where the products have consistent demand and will see a sudden increase in demand level. It is useful for businesses that have a majority of the production process done in-house and can handle unexpected demand surges. 

 5. Consignment

Under this method, the consignor (wholesaler) gives possession of the goods to the consignee (retailer). The consignee is expected to pay the consignor only after selling the goods in the market. This method is most popular in the informal sectors of the economy but can be made more efficient with the use of inventory management software.

 6. Cross-docking

Under this method, you are expected to hold the stock for the least amount of time. As soon as the goods are received, they are packed and shipped for real-time delivery, ensuring efficient fulfillment. This system theoretically eliminates the need for any stock. This method is useful for e-commerce businesses that are following the marketplace model. 

 7. Barcode Scanning

This method involves scanning a barcode before you handle an item in the warehouse. The fact is that barcodes are affordable, and human mistakes are costly. Therefore, it is important to have a system that lets you follow a scanning system to receive, ship, or alter an item in a business. It is particularly relevant for companies with more than a handful of items to handle,  as it ensures efficient replenishment of inventory.

8. Backordering

A backorder is when a business is open to accepting orders for the stock that it does not have in the warehouse when the order is placed. Backordering works well for pre-launch or products that have a strong hype driving their growth. It is particularly relevant for products with a history or which have a celebrity driving strong word-of-mouth marketing. This process of ordering products that are not currently in stock is known as backordering.

 9. Demand Forecasting

This method uses predictive analysis to forecast the possible changes in consumer demand in the future. In today’s business environment, it is critical to have a strong demand forecasting strategy on your side to foresee the expected changes in the marketplace. A good technology platform will let you access such data analytics, which can equip you to make such demand forecasts.

Conclusion

These are the most popular inventory management techniques that you can adopt in your business to make your processes more efficient. With the e-commerce industry expected to grow rapidly in the coming years, the inventory management system is expected to become all the more significant for the success of any business.

Schedule a FREE demo with Unicommerce Warehouse Management consultants.

Suggested Read:

• How does Warehouse Management System Works?
• Role of Warehouse Management in the FMCG Industry in India
• Solutions, Strategies & Benefits of the D2C Business Model
• Apparel Industry in India – Trends, Challenges, Opportunities & Solutions
• Footwear Industry in India – Trends, Challenges & Solutions
• How to Sell on Lazada Marketplace in Southeast Asia?
• How to Sell on Noon in the Middle East?
• Key E-commerce Challenges & Opportunities in Malaysia
• Omnichannel Retail Trends in the Middle East
• Order, Inventory, And Logistics Management Challenges in the UAE

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It is why most of the current e-commerce businesses have shifted to a more clutter-free approach – an inventory management system. This software offers significant advantages over the traditional manual or spreadsheet approaches and gives you granular control over your stock while improving transparency.

But given the plethora of inventory management systems on offer, how do you choose the right one for yourself? This article discusses the thought process and criteria behind choosing the best inventory management software for your e-commerce business.

Questions to ask before looking for an Best E-commerce Inventory Management Software – 

A myriad of factors decide the best-centralized inventory management software for your e-commerce business, and most of them have more to do with your business than the solution itself. So here are the questions to answer before embarking on choosing the best inventory management system.

1. What inventory challenges do your business face?

A great way to start your tryst to find the best inventory management system would be to understand your inventory’s challenges first. Do you feel there is a lack of transparency in managing it? Do you frequently run out of critical items? Can you efficiently handle safety stock, replenishment stock, and average stock level individually? How efficient are you in handling fluctuations in customer demand?

Finding the relevant business issues that you want to cater to would help you refine the options available and find vendors offering the features you need.

2. Do you need a server-based or an online inventory management system?

Several e-commerce businesses still prefer legacy systems and purchase on-premise, server-based inventory solutions even after years of cloud being around. So it is imperative for you to understand the pros and cons of both options and choose one that would suit your business the best.

For example, are you willing to spend higher on an on-location inventory management system, or are you happier with a cloud-based solution to handle your stock requirements effectively? Is your team well acquainted with the former and is showing reluctance to shift? Or are you better off with the 99.9% uptime guarantee that cloud providers guarantee?

All of these would help you make an informed decision about the type of inventory management system to deploy.

3. What are your integration needs?

In the traditional days, most software would run solo and had no interdependence. But in the present day, seamless collaboration has been the way forward. B2B e-commerce brands are looking for solutions that can seamlessly integrate into their present software ecosystem without tweaking what works for them.

A robust inventory management software has also been a critical business differentiator and has enabled e-commerce players to be flexible with regards to their inventory handling and ordering, allowing them to gain an edge over their competition. 

In addition, seamless integration would enable e-commerce businesses to derive critical insights from the inventory management software and feed them to other business processes in a clutter-free manner to achieve impeccable actionable insights.

How to Choose Right E-commerce Inventory Management System?

Now that you understand your business needs, the next step is to look for the following while choosing the best software for inventory management in India or abroad –

#1 Ease of use

Ease of use is one of the primary constraints while looking for the right inventory solution for your e-commerce business. An easy-to-use software will allow your workforce to handle it better and improve their stock handling capabilities.

#2 Scalability

E-commerce businesses are born with the idea to be scalable, and every software choice they make must resonate with the same idea. So it is imperative for you to choose a scalable solution and offer you the bandwidth you seek.

#3 Features

Every e-commerce business has specific requirements. So choose an inventory management software that caters to your particular needs, such as batch tracking, bundling, real-time inventory update, barcode tracking, and more.

#4 Valuable insights

With the advent of data-heavy solutions, it has been easy to derive critical analytics. Analytics play a vital role in the way your business is handled. So, while looking for the right inventory management system, make sure you choose the one that offers a wide range of palpable and practical insights.

Read Inventory Management Case Study – How Multi-Brand Car Service Company attained 9X Sales Growth  

Wrap up

Choosing an inventory management system that is easy to use and caters to all your stock needs is a vital decision. It makes the task easier for your workforce and contributes to better catering to your customers.

Schedule a FREE demo with Unicommerce Inventory Management consultants.

Related Read:

• Order, Inventory, And Logistics Management In The UAE – Challenges & Solutions Associated With The Processes
• What is Inventory Cycle Counting & Why to Use it for Effective Warehouse Management?
• How can you Streamline Inventory Management using Barcode Scanning?
• How to Implement a Barcode System with Inventory Management Solution?
• Overcome Inventory Challenges With FIFO Based Picking
• FMCG Industry challenges in India
• Healthcare Industry: Trends, Challenges, Opportunities & Solutions
• What is Warehouse Management System?

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The post What are the Benefits of Having Inventory Management Software? appeared first on unicommerce.com.

The post The Challenges of Multichannel Inventory Management and How Can D2C Brands Overcome Them in 2023 appeared first on unicommerce.com.

A good inventory management software works best with a fast and accurate barcoding system and becomes completely necessary if you:

• Manage your inventory on a big scale in a warehouse
• Consume inventory for self utilization such as training and photoshoot purposes
• Have Vendor alliances who rely on barcode scanning
• Sell through multiple sales channels Online/Offline

As useful as a barcode inventory management system is, the process to fully equip your warehouse and utility centers with this system can be a little tricky and time-consuming. But we at Unicommerce are here to solve this very problem of yours with our guidance and support to help you implement a robust inventory management system using barcodes for improved efficiency and productivity of your warehouse/business operations.

This blog has been designed to help you grab onto the most useful information about what is barcode scanning, why it is necessary for your business and how to implement it whether you are a small or large scale business.

First off, let us understand what exactly is a barcode and how can you manage inventory efficiently using barcodes!

What are Barcodes?

Barcode tracking or scanning is the method to streamline inventory allocation, tracking and maintenance. 

Typically present in 3 forms, barcode systems have now become essential for not only keeping track of inventory but also to extract data, make secure payments and much more. 

Initially, barcode scanning systems were of numeric and alpha-numeric form and were considered as one-dimensional with a unique combination of letters and numbers and or bars of different widths. 

QR codes are another form that are square in shape and include a combination of small lines and dots. The QR codes are considered to be two-dimensional. 

No matter what type of barcode you choose, their use provides some huge advantages when it comes to managing your inventory. As barcodes are unique, room for error is almost null and that is what makes it so much more efficient and necessary for your e-commerce business. Now let us try to decode what exactly a barcoding scanning system is and how it makes a difference for you in your efforts to manage inventory. 

Read more – How can you Streamline Inventory Management using Barcode Scanning?

What is Barcode Inventory Management System?

A barcode inventory management system allows your warehouse staff to scan these unique QR codes with a barcode scanner, a device especially made to read barcodes, to automatically present complete data of the inventory in question. 

When scanned, each barcode exhibits specific information and data about each item from the Universal Product Code (UPC) which is then transferred to your online inventory database. The labels and functions on your inventory can also be easily customized as per industry standards to help you be updated.

Now that you have a fair understanding of what Barcode Scanning is and how it works, let us look at some benefits of implementing a barcode system for inventory management.

Benefits of Barcode Inventory Management System

Using the right Inventory Management Software with Barcodes will give you a lot of advantages this in your overall operations, productivity and profitability including:

1. Error Proof Results
2. Complete Security
3. Higher Savings 
4. Control over Information
5. Fast and Easy Handling

#1 Error Proof Results

With no more manual dependency, the chances of error become almost null increasing your productivity and with little to no room for data miscalculations.

#2 Complete Security

The biggest advantage of having a barcode inventory management system is that it gives you the ease to have complete knowledge of where, with whom and how much inventory you have. Barcodes allow you to trace your inventory in cases of theft, wrong and or damaged deliveries all at a single panel right at your fingertips.

#3 Higher Savings

Automation not only cuts back on manual dependencies but also reduces the overall cost to a company to manage its inventory and warehouse operations. Barcoding helps you reduce labour and training costs and gives you complete visibility of inventory to help you assign work accordingly.

#4 Control over Information

Crucial information about various assets can be easily tracked with the help of barcode scanning and this enables each business to print and customize additional information that they wish to share with the end-users. From the built and type of an inventory to the locations from where it has been sent, all can be detailed in the barcode labels.

#5 Fast and Easy Handling

When you have all the information about each of your products right in a tiny QR code, you can process huge chunks of data within minutes by a simple scan and derive conclusive results based on real-time updates benefitting your overall profitability.

With these highly impressive advantages of having a barcode inventory management system, I’m sure now you must be thinking of understanding the process of how to actually take on this solution and align it with your current structure of operations! 

How to Implement Barcode Inventory Management System?

Transitioning from a manual to automated barcoding system may look like a huge task but with the right support and guidance, you can not only achieve the right implementation but also reap long term benefits of the solution.

Here are the major processes involved for small or large scale eCommerce businesses, to begin with, a barcode tracking system or an inventory barcode system.

#1 Check what the Industry accepts

The first step is to ensure that you are aligned to adopt the ongoing or latest barcode system which is acceptable by the government and used within the eCommerce industry.

You need to check with the mandated norms of packaging and labelling of your products that will be eligible for acceptance. You will also have to decide between choosing a 1D or 2D label, both of which can be used based on your workflow, product, etc.

#2 Create a Product Code

Once you know what is acceptable and correct as per industry norms, you need to create an asset code in accordance with the rules. The code you create can be a Universal Product Code (UPC) or Stock Keeping Unit (SKU).

UPCs are 12 digit long codes, broadly more accepted for business uses around the globe, and can be received by registering with Global Standard 1, which then can be used to trace and get updates on your products across the world.

SKUs, on the other hand, are 8 digit long codes that are unique to every business. They can be generated manually or using an inventory management system and can be used for internal operations such as stock maintenance, tracking and data processing. 

#3 Finalize what information to put

Your barcode will have all the necessary information about your product and business to be successfully carried out and delivered to the right customer. To ensure that, you need to finalize what all you want to put in the label including location, identity numbers, expiration date for perishable items and much more.

Using a combination of numbers, letters, colours and shapes of labels can help you differentiate between all the items and to avoid wrong deliveries.

#4 Generate the Barcode

After finalizing everything right from how you want your barcode to look like and what information it should contain, the main task of creating a barcode for each of your products begins.

This massive task can be done by either using an online barcode generator or a free barcode software. Once you have created the barcode, you need to print the label sheet using any standard printer (inkjet, laser or thermal).

#5 Pick the right Barcode Scanner

While you might have cautiously followed the above 4 steps, if you do not invest in having a good scanner to extract all the information put on your barcode, you might see no results.

A scanner is a wired or wireless device that allows your staff to maintain operations throughout the warehouse and gives real-time updates on your inventory. If you use wireless scanners you get the flexibility to move around the facility and have all the data from these scanners stored into a memory chip that can be later transferred to your computer systems. 

You can also go for a wired scanner that is usually cheaper but needs to be plugged at all times during use, to a computer and a charging outlet. 

Handheld barcode scanners wired or wireless, are the most beneficial for both small or large businesses. While it costs a little more than any other type of scanners, it is a one-time investment that is sure to streamline your entire inventory management process once and for all. 

#6 Select a Barcode Software

Having a software program to manage your inventory and all other operational tasks has become a mandate now due to the heavy demands and higher expectations by the customers.

The same applies for barcode scanning, and to further ease things for you, there are some really great options to choose from. But the only thing to keep in mind is to choose a software that operates as per your business standards and allows customization. 

All these steps will ensure a smooth and successful implementation of the barcode inventory system, but what changes will they bring to your warehouse operations you ask?

How will a Barcode Inventory Management System improve your Warehouse Operations?

With lots of overall benefits that a well-implemented barcode system can provide you, there surely are some specific improvements that you will see in your e-commerce warehouse management system within a short period of time post transitioning.

Business growth, increased productivity, higher efficiency and accuracy are some of the most basic outputs of a good barcode inventory management system, but there are many more features that enhance your warehouse operations to distinguish your business from others and help you scale up rapidly. The right barcode system:

• Enables Paperless Operations  
• Eliminates Picking Errors
• Provides Accurate Allocations 
• Reduces time to locate inventory (bin and shelf)
• Cheaper to Implement 
• Easy-to-use interface for all staff
• Allows cost-effectiveness 
• Generates real-time analysis of data
• Updates when inventory is low 
• Improves purchasing and ordering processes

Impressed by how a single transition can change the way you do business?

You can achieve all these benefits and improve your ROI by simply hiring the best and most trusted technology solutions provider in the country!

Related read –

• Why do E-commerce Businesses need Inventory Management Software?
• What are the benefits of having Inventory Management Software?
• Why is Inventory Management Important for your E-commerce Business
• FMCG Industry challenges in India
• How does Warehouse Management System Works?
• Logistics vs Supply Chain Management
• E-commerce Apparel Industry: Trends, Challenges, Opportunities & Solutions
• UniShip – Advanced Logistics Tracking Platform
• UniReco – Automated Reconciliation of Orders, Returns and Payments
• Key Challenges & Benefits of Marketplace Payment Reconciliation
• Benefits of Shipping Notifications

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The post Top Inventory Management Challenges and How to Tackle them Effectively appeared first on unicommerce.com.

FIFO Based Picking for Inventory Management in the Warehouse

Many retailers, wholesalers, manufacturers or even e-commerce sellers have hundreds of locations to carry thousands of items. But majorly face these three specific challenges with the inventory-

• Out of Stock
• Shrinkage
• Outdated

Stock rotation to avoid loss due to out of date inventory is the prime issue companies face which even digs them into huge losses if not managed efficiently in time. Many businesses have the inventory with an expiration date. So, shipping the items on the principle of “First in, First Out“, protects the product quality and freshness. Using FIFO, you can ship products relatively in neat and clean boxes, as products would have spent less time in your warehouse.

Companies that sell perishable products, such as food products, medicines or in trend fashion accessories, apparels, footwear etc. commonly follow FIFO as their method for inventory valuation.

For example, a medical store purchases medicines at regular intervals to stock its shelves. As customers purchase medicines, the stockers push the oldest medicine carton to the front of the shelf and replace medicines with new MFG date behind those cartons. The cartons of medicines with the nearest expiration dates are sold first, whereas the ones with later expiration dates are sold after the older medicines. This ensures that the first products purchased will be the first products sold!

Read: How Urban Company Achieved 8X Growth in 27 Months with Unicommerce’s Warehouse Management Solution!

Benefits of Adapting FIFO Inventory Software based Picking in Warehouse

1. Reduce Inventory Loss Due to Obsolescence

Outdated or obsolete products aren’t an issue for most of the industries. But for those who deal in perishable products, to remove the outdated inventory is the costliest and most unnecessary task in a warehouse. Use of FIFO in such industries ensures the products to be picked and shipped as quickly as possible.

2. Improved Customer Experience

Reduce the number of incidents where customers can receive an older, obsolete product due to improper rotation of stock in your warehouse. With FIFO you can now ensure a better user experience and deliver a fresh product which is cleanly packed.

3. Warranty Control Improvements

With FIFO implemented in your warehouse, define Shelf life, Expiry, Manufacturing Date & Tolerance. This will eliminate incidents of shipping products that are close to or past warranty expiration.

4. Make Your Warehouse Stock Rotation Efficient

Implementing FIFO will ensure that you ship the most recent and desirable products to your customers. It is the most widely used inventory valuation method as it is practically much easier and safer for companies to opt.

Related read – How FIFO & FEFO Methods Minimize Stock Losses for Business

Let’s Manage Inventory Smartly!

By implementing FIFO, businesses can effectively overcome common inventory challenges, streamline operations, and ultimately contribute to higher customer satisfaction and profitability. Adopting such a robust system is vital for the success of any inventory-dependent business.

More resources:

• • • Top Multichannel Inventory Management Challenges and Solutions
    • Inventory Management Software – Top 9 Benefits
    • Top Challenges & Solutions of Inventory Management
    • Why do e-commerce businesses need Inventory Management Software?
    • Types of Inventory Management Techniques
    • UniShip – Advanced Shipping Tracking Platform
    • UniReco – E-commerce Marketplace Payment Reconciliation
    • Key Challenges & Benefits of Marketplace Payment Reconciliation
    • Benefits of Shipping Notifications
    • E-commerce Shopify Integration with Unicommerce

The post FIFO based Picking in Warehouse – How to Overcome Inventory Challenges to Maximize Efficiency? appeared first on unicommerce.com.

Deploying an agile barcoding system = managed and efficient inventory management. Why? Barcoding can simply save all the hassles of manually tracking and monitoring the inventory by giving you quick access to your product along with its description, availability in the warehouse, prices, and many other aspects. Additionally, for large businesses with diverse and complex product lines, a barcode scanning system monitors inventory, tracks assets, creates orders while enhancing operational efficiency. 

In a nutshell, an inventory management software works best with a fast and accurate barcoding system and becomes completely necessary if you:

• Manage your inventory on a big scale in a warehouse
• Have vendor alliances who rely on barcode scanning
• Sell through multiple sales channels online/offline

As useful as a barcode inventory management system is, the process to fully equip your warehouse and utility centers with this system can be a little tricky and time-consuming. And there are plenty of tools that support this low-cost data collection technology. But which one is best for your business? 

Let us understand what exactly a barcode is, and how you can manage inventory  & warehouse efficiently using barcodes. 

What are Barcodes – 1D Barcode vs 2D Barcode

Barcodes are a machine-readable representation of numerics and characters. They generally consist of bars and spaces and are used in tracking inventory at an operational level. While it is difficult for a person to manually store letters and numbers in the backend system, a barcode scanner device can track multiple characters at a single point in time, saving both time and money. 

Barcode tracking or scanning is the method to streamline inventory allocation, tracking, and maintenance. When scanned, each barcode exhibits specific information and data about each item from the Universal Product Code (UPC) which is then transferred to your online inventory database. The labels and functions on your inventory can also be easily customized as per industry standards to help you be updated.

Typically, a barcode system is classified into two different types; 1D and 2D. Although the scanners might seem simple, it’s important for you to distinguish between the two hardware types as their contrasting functionalities make a lot of difference.

1D Barcodes

One-dimensional barcodes come in numeric and alpha-numeric forms. They are a unique combination of vertical bars of different widths and numbers. The space present between the lines generally allows the scanners to recognize the product. While these types of barcodes are used to track inventory including raw materials, finished products, products sold, etc., you can also use them to track fixed assets for keeping financial records balanced. Some types of 1D barcodes are; USPS IMB, Code 39, UPC-E, EAN 128, EAN-13, etc. 

2D Barcodes

The two-dimensional barcodes provide more information to the user as compared to 1D barcodes. These types of barcodes include a combination of small lines and dots. They are generally designed as a squared-shape figure with multiple pixelated dots or geometric figures. With a single scan, these types of barcodes can disclose data, such as quantity, price, web address, image, etc. The QR code is one of the examples of these types of barcodes. Some of the examples of the 2D scanners are; Aztec, MaxiCode, Data Matrix, PDF 417, etc.

Now let us try to decode the barcoding scanning system in-depth and understand how it makes a difference for you in your efforts to manage your warehouse inventory.  

How can you Streamline Inventory Management across Warehouses with Barcode Scanning?

Due to the uniqueness of barcodes, there is no or very little room for errors. That’s what makes it best to manage your e-commerce business. Now let us try to decode how a barcode system makes a difference for you in your efforts to manage inventory & warehouse. 

Here are a few of the main reasons why you need a barcode system in your warehouse!

1. Organize inventory and warehouse operations easily

Since a barcode consists of a huge chunk of data including the product specs, SKU code, date of manufacturing, expiry date, country of origin, etc., which in its absence is hard to record manually. This detailed information not only lets you organize inventory in a systematized manner but also saves you from huge losses. Assume; you want to follow the FIFO system in your warehouse but checking the expiry date of each item will both consume more time and money. With barcode scanners in handy, you can process huge chunks of data within minutes by a simple scan and derive conclusive results based on real-time updates, benefitting your overall profitability.

2. Minimize the Duplication of Resources

In the warehouse, there is an increased chance for an item to get lost or misplaced. But with the help of barcode scanners, locating items in bins or shelves becomes easier, saving the unnecessary duplication of time & resources. Additionally, barcodes allow you to trace your inventory in cases of theft, wrong, and or damaged deliveries all at a single panel right at your fingertips.

3. Manage Maintenance, Repairs, and Operations (MRO) Easily

While some part of the inventory is meant to be picked and packed for shipping to the customers, another part of it is kept for maintenance, repairs, and operations (MRO). It generally consists of materials that are used in production processes and are not a part of the end product directly. For instance, you run an e-commerce business of fashion apparel. Now imagine, during the peak holiday season, you have a large volume of orders to be fulfilled but all of a sudden you ran out of some important spare parts. But if you would have a barcode scanner to scan your warehouse essentials your day would have been saved. Thus, using a barcode for MRO is imperative. 

4. Control over Information

Crucial information about various assets can be easily tracked with the help of barcode scanning and this enables each business to print and customize additional information that they wish to share with the end-users. From the built and type of inventory to the locations from where it has been sent, all can be detailed in the barcode labels.

5. Maintain Error-Proof Results

Manual dependency tends to increase the chances of errors. Ask yourself; is feeding inventory data into sheets easier for you? Maybe for 50 or 100 products, but not when you have to manage thousands of items at once. If you have a barcode system in place, you would be able to track any sort of inventory discrepancy. While you will be saved from shipping the wrong item to the wrong address, it will also reduce order returns. Thus, with barcoding, the chances of error become almost null increasing your productivity and with little to no room for data miscalculations.

6. Higher Savings

Automation not only cuts back on manual dependencies but also reduces the overall cost to a company to manage its inventory and warehouse operations. Barcoding helps you reduce labor and training costs and gives you complete visibility of inventory to help you assign work accordingly.

7. Improve the Cycle Count Process

Using Cycle Count in your warehouse surely enables you to reduce or eliminate the need for periodically or annually counting the physical inventories. But ask yourself that if your barcode system is intact then how easier will it become to implement the process. From checking the shelf location to verifying the physical count of inventory to reconciling any sort of missing inventory, everything will be sorted with a barcoding system. 

Improve your Overall Business Operations and Minimize Time & Cost Using a Barcode System!

With the overall benefits that a well-implemented barcode system can provide you, there surely are some specific improvements that you will see in your warehouse management within a short period of time post transitioning. While a barcode system in place can accelerate your business growth, it definitely possesses the power to simplify and ease out the entire process of tracking and chances of human errors. Not to mention, the bigger your business grows, the greater your operational requirements increase. But with low-cost and portable tools such as barcode scanners, you can decrease human errors and cut any sort of operational costs.

Related read –

• How does Warehouse Management System Works?
• Healthcare Industry in India – Growth Drivers, Challenges, Solutions
• Role of Warehouse Management in the FMCG Industry in India
• E-commerce Apparel Industry: Trends, Challenges, Opportunities & Solutions
• UniShip – Advanced Shipping Tracking Platform
• UniReco – E-commerce Marketplace Payment Reconciliation
• Key Challenges & Benefits of Marketplace Payment Reconciliation
• Benefits of Shipping Notifications
• E-commerce Shopify Integration with Unicommerce
• Why Pick List is Important for Warehouse Operations?
• What is Inventory Cycle Counting?
• Benefits of Inventory Management Software
• Why E-commerce businesses need Inventory Management Software?
• Why is Inventory Management Important for E-commerce Business?
• Inventory Management Techniques for Business Scaling

Read how Businesses are growing with Unicommerce –

• How a Fashion & Accessories Brand Managed 145 Stores
• How Chumbak boost sales across 58+ Retail Stores with a 99.99%+ fulfillment rate
• Establishing effortless business operations & tremendous growth for Iconic Fashion India
• How TCNS Clothing Co. Ltd achieve 9X Growth in Sales

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A study by the National Bureau of Economic Research found that product bundling can increase profits by up to 30% by attracting new customers, increasing customer loyalty, and ultimately driving sales. This substantial increase highlights the profound impact bundling tactics can have on a business’s bottom line. So, let’s understand what product bundling is and how it can increase the profitability of your e-commerce businesses!

What is Product Bundling?

Product bundling refers to a strategy where multiple products or services are combined and sold as a single package, often at a discounted price or with added value, to incentivize customers to make a purchase. This strategy is used to persuade customers to purchase more by grouping complementary or related items together. 

The Man Company’s 30-Day Men’s Grooming Kit is an example of a product bundle. Instead of selling shampoo, moisturizer, face wash, and other grooming products separately, they are sold as a combination, which attracts more sales due to the combined value and convenience it offers to customers.

Types of Product Bundling

There are several bundling strategies to group products together, and some of the most commonly used strategies include:

Pure Bundling: This strategy entails offering products or services solely as a bundled package. Customers cannot purchase the items individually. 

Mixed Bundling: Mixed bundling allows customers the option to purchase bundled products as well as individual items separately. 

Price Bundling: This approach involves offering a bundle at a single price that is lower than the sum of the individual items, encouraging customers to perceive it as a great deal. 

Key Benefits of Product Bundling

Product bundling in e-commerce offers numerous advantages that significantly contribute to the success and profitability of businesses operating in this competitive landscape.

1. Increased Sales and Revenue

Increasing the Average Order Value (AOV) is a critical metric for e-commerce businesses aiming for sustainable growth and profitability. Product bundling serves as a powerful strategy to achieve this goal by enticing customers to spend more per transaction. 

Offering bundled products at a discounted price compared to purchasing each item individually motivates customers to perceive greater value. This encourages them to add more items to their cart to take advantage of the bundled offer, thereby increasing the order value and ultimately increasing the sales and revenue for your business. 

2. Expanded Opportunities for Cross-Selling and Upselling

Cross-selling involves recommending complementary products or services to a customer based on their primary purchase, aiming to enhance their overall shopping experience. On the other hand, upselling encourages customers to consider purchasing a more advanced or premium version of the product they are interested in, emphasizing superior features or benefits.

Strategic bundling of products opens expansive avenues for both cross-selling and upselling. By crafting bundles that pair high-demand items with compatible or supplementary products, businesses can seamlessly integrate cross-selling opportunities into the customer’s purchase journey.

3. Improved Inventory Management

Excess inventory management is another significant advantage of product bundling, which allows businesses to strategically move surplus or low-selling SKUs by combining these items with more popular or high-demand products. By packaging these less liquid items into bundles with more sought-after goods, businesses can increase the appeal of these slower-moving items to customers. 

This stock rotation approach not only helps in reducing excess stock levels but also prevents potential losses due to obsolete inventory. Bundling facilitates a proactive strategy to clear out inventory, optimize warehouse space, and improve cash flow by converting stagnant stock into revenue-generating bundles. 

4. Cost Efficiency and Reduced Overheads

Product bundling not only drives sales and revenue but also offers significant cost-saving opportunities for e-commerce businesses. Bundling leads to streamlined marketing efforts and packaging, reducing the expenses associated with individual promotional campaigns and separate packaging materials. 

Efficient inventory management through bundling minimizes holding costs for excess stock, optimizes warehouse space, and lowers storage expenses. Consolidating products into bundled shipments reduces shipping and fulfillment costs per unit, optimizing logistical expenses. 

Challenges in Product Bundling

Despite the numerous benefits, product bundling does come with its own set of challenges that businesses need to address:

1. Determining the Right Products to Bundle

Identifying the optimal combination of products for bundling requires a deep understanding of customer preferences, buying behavior, and market trends. Choosing the wrong combination can result in low demand or insufficient perceived value.

Solution: Partnering with a technology provider equipped with robust inventory management and analytics tools can help identify the best products to bundle. 

2. Pricing Strategies and Profitability

Developing pricing strategies that balance customer appeal while ensuring profitability is also challenging. Incorrect pricing models can affect profit margins and hinder the success of bundling initiatives. 

Brands like WOW Skin Science encountered a substantial challenge with their BOGO (Buy One Get One) scheme due to Goods and Services Tax (GST) overpayments, significantly impacting their profitability within the bundled offering. In this scheme, the GST was being charged on the MRP of both products, including the free item. This resulted in higher tax payments, which affected the company’s profit margins. 

Solution: To overcome these types of challenges, businesses require precise systems for calculating prices within bundled products. Leveraging the expertise of their robust technology provider, WOW Skin Science implemented a customized invoicing solution where GST was levied only on the product with an MRP value, excluding the item with zero MRP. This tailored approach effectively eliminated the GST overpayments while alleviating the tax burden on the company. 

3. Managing Inventory Effectively

Efficient inventory management is essential for successful product bundling. Ensuring sufficient stock levels for all components of the bundle, coordinating multiple SKUs, and avoiding stock outs or overstock situations can be challenging. 

Solution: Brands need to employ robust inventory management systems that provide real-time visibility into stock levels for each bundled component. Emerging brands like NUA successfully addressed these challenges by leveraging the right inventory management software. Whether creating comprehensive period kits or bundling regular SKUs with freebies, NUA’s adept use of appropriate inventory management solutions has proven instrumental in streamlining its bundling operations.

Let’s Make Selling Easy!

As a strategic tool, bundling strategies have shown remarkable potential in not only enhancing sales but also elevating customer satisfaction and driving profitability. The diverse range of benefits highlights its pivotal role in modern business strategies. However, navigating the challenges of product bundling requires robust technological support. Businesses can leverage innovative warehouse and inventory management systems to overcome these hurdles. 

Ultimately, the right use of bundling tactics can pave the way for business growth, optimization of resources, and a competitive edge in the dynamic realm of online retail. Embracing the power of product bundling stands as a key driver for sustained success and profitability in the e-commerce ecosystem.

The post Product Bundling for Efficiency and Profitability – Types, Benefits, and Challenges appeared first on unicommerce.com.

Is it becoming a real hassle for you to elevate your eCommerce business, manage the extreme online demands, meet the expectations of the consumers all while maintaining a smooth operational flow? 

Well, you are not alone because the rapidly growing and immensely competitive space of e-commerce in Malaysia is not that easy to make a mark at, but is also not an impossible forte to make your mark on. 

With the right technological solutions, proper operational procedures and well-established customer relations, the Malaysian e-commerce market space can be your breeding ground to success. 

But how to move forward in the direction of achieving the above-mentioned objectives? This blog is your one-stop guide to all your queries, concerns and possible business strategies in order to achieve maximum growth with minimized errors and hurdles.

Also read: What is a Warehouse Management System and How Does It Work?

E-commerce in Malaysia

The e-commerce industry in Malaysia has seen a massive growth of US$ 4.3 billion in 2020 and is expected to grow up to US$ 8.1 billion by 2024!

Over 25 million, a total of 80% of the overall population of Malaysia are avid internet users and online shoppers, making the region a hotspot for e-commerce advancement and growth.

The government of Malaysia works around several dedicated ministries under the National eCommerce Council NeCC and programs such as the National e-commerce Strategic Roadmap NeSR in order to drive the upward curve of eCommerce in Malaysia and to increase the GDP contribution of the country.

After Singapore in the South East Asian region, Malaysia is the second-largest e-commerce market and the increasing number of middle- earning class in the country, internet users and constant investments of big eCommerce spaces such as eBay, Lazada, Zalora, Shopee, Carousell, etc., in the country, amplifying the choices and demands of online consumers, it is soon going to level up with Singapore in terms of eCommerce growth.

But with great opportunities, comes greater challenges and the same is the case with Malaysia where you as an eCommerce business owner will face several difficulties before you succeed in becoming a top seller in the regions.

E-commerce Biggest Challenges in Malaysia

While the e-commerce market in Malaysia is booming and becoming the first choice of local as well as international businesses to invest in, there may still persist some challenges in your road to success.

Talking about how strong the entire e-commerce ecosystem is in Malaysia and how the government is constantly working around plans and strategies to uplift sellers, retailers, brands, etc., the implementation of these policies and systems still require time and a little more push for proper implementation.

The ever-changing consumer demands is another hurdle that most e-commerce businesses in the country fail to adapt successfully and rapidly because of the lack of proper technological support and assistance right from accurate warehouse management to order and inventory management, providing Omnichannel solutions and more!

Biggest Challenges the Malaysian e-commerce businesses face may involve:

1. Managing Inventory & Orders

Malaysian retailers have struggled to adapt to the technological advancements going on in the eCommerce industry and their biggest hurdle in becoming a top online seller was to properly manage their inventory in order to serve the customer demands. 

Leading Hardware company, ATKC Hardware found itself in a similar situation when they initially decided to take their business online. Coming from a small region of Malaysia, the company was looking to expand across the country and was hoping to take its brand to the next level. 

The first step in the direction for ATKC Hardware was to execute accurate inventory management solutions in order for them to improve stock maintenance and provide better serviceability. 

Faced with the crucial issue of managing their products, the brand decided to implement Barcode Inventory Management System to help them fasten e-commerce processes. 

In absence of a proper inventory management software solution, your business can face severe problems right from maintaining stock freshness, enabling stock rotations, restricting stocks outs and dead stocks etc.

2. Handling presence across B2B and B2C selling platforms

One of the most common challenges faced by hundreds of e-commerce businesses including one of the well-renowned cleaning and sanitization product companies, Citycoin that sells its products under the name of Lovis, was to require proper product distributions and visibility to achieve sales growth for their businesses.

The brand struggled with selling its products on retail stores and offline channels and faced several financial challenges. The only solutions that helped them was to switch to online selling, which required them to integrate on leading marketplaces, carts, and online website to reach a wider pool of customers and to showcase their products better. 

The brand listed its products on the leading marketplaces such as Shopee and Lazada which helped them attract more and more customers and significantly reduced their burden of deploying dedicated sales and marketing teams to take care of their sales. 

Kacang Macha is another popular e-commerce FMCG seller in Malaysia that sells Halal Indian Snacks to Malaysian customers. 

The company initially struggled to manage its presence across B2B platforms such as Alibaba, Daganhalal, etc as well as B2C spaces. Due to their exposure across these selling platforms, the brand has managed to overcome their challenges of taking their products across audiences.

And so, without allowing your products to reflect on multiple B2C as well as B2B eCommerce marketplaces, carts, etc., it will become an issue to gather customers and achieve higher sales.

3. Balancing Surge in Demands and Fulfilments

Another key challenge that eCommerce businesses face while transitioning and positioning themselves as rapidly growing eCommerce players is the effective management of warehouse operations to ensure faster order fulfilment rates and to supply in accordance to demand.

Herman Foods is a big name in the Malaysian eCommerce market that ships Malaysian ‘Musang King durians’ across borders. The brand ships across 18+ countries and has always wrestled with the need to balance their supply in terms of the demands they get for the Malaysian delicacy. 

The brand has deployed tons of manual labour and adopted technological support in order to maximise their rate of order processing to provide higher quality exports to all the regions of their focus.

And so, not having the advanced technology assistance to tackle the evergrowing demands of the shoppers while carefully handling all your products can become a pain point for any business.

4. Tackling Manual Dependency for e-commerce Operations

When demands rise, e-commerce businesses are required to speed up their picking, packing, dispatch and delivery operations, but doing things manually can cause a lot of delays, errors, etc., 

Kait Lifestyle Store is an organic baby food company selling over 1000 products in Malaysia which struggled with managing orders and inventory manually while maintaining the freshness of all their products.

Without automation, taking care of each and every process of your order cycle can become really difficult and may lead up to poor customer service, lower customer loyalty, increased order cancellations and returns, all of which can severely impact your overall business growth.

While these challenges top the list of every e-commerce player or even the new ones starting their e-commerce journey in Malaysia, there can always be more business-specific and personal barriers each seller can face while trying to create a niche for themselves in the vastly expanding e-commerce space of Malaysia.

But for every problem, there is a solution and in the case of overcoming these challenges possessed by the Malaysian e-commerce market, the solutions are well proven and highly adaptable for any small to medium business with a little support and better business planning.

E-commerce Opportunities in Malaysia

Due to the massive development and government initiatives towards making eCommerce the biggest sector in Malaysia, the opportunity to become a leading online seller in Malaysia is huge.

1. Wider Access to Products Across Borders

The majority of the population of Malaysia consists of young, working-class, fashion and tech-savvy individuals who are constantly on the lookout for well-renowned brands, locally as well as internationally. 

The consumers in Malaysia are a ‘Mobile-First’ audience with over 1.9 billion purchases made via a smartphone in the year 2019 alone and prefer to shop from apps and social media platforms rather than specifically from websites.

Due to their preference of shopping from smartphones, online shoppers in Malaysia have the ability to shop whatever from wherever irrespective of the origin of a product, right from the comfort of their homes, which plays a significant role in the success of eCommerce in the region.

2. Higher Trust of Consumers on Digital Payment Modes

If we talk about the consumer behaviour in Malaysia, It is evident to see that out of all the e-commerce markets around the world, South East Asia is one region where the consumers do not fear or are rather more comfortable paying for their products online and try to avoid physical payments or cash on deliveries. 

This is a completely different and e-commerce positive behaviour that most of the other countries struggle to achieve but in Malaysia itself, online transactions and digital payments cover up over 93% of the total eCommerce payment methods, making this region a favourable space for big payment gateway companies such as PayO, Google Pay, PayPal, etc.

3. Greater Influence of Social Media

Social media holds a huge impact on the population of the entire South-East Asia, let alone Malaysia, where over 25 million people are active social media users. Online shoppers depend so much on the ratings, reviews and influencer feedback of each of the products they want to buy, that the distinction between an e-commerce platform in Malaysia and that of a social media platform is vanishing. 

Social media platforms such as Facebook & Instagram have also added to the ease of shoppers as well as sellers to list their products to a bigger pool of audience, get real-time feedback on their products and work around effective sales strategies to grow and profit

4. Rapid Demands for Essential & Non-Essential Items

Essential products such as groceries and FMCG items have grown in demand in Malaysia as the country ranked 2nd in the list of fastest-growing grocery markets as per a Statista report in  2018. 

Fashion & Beauty, Electronics, Toys, Furnitures etc are the most preferred non-essential categories that see increasing demands and have provided space to a number of eCommerce businesses to flourish in the region.

5. Better Geographical Conditions

In terms of shipping and logistics, South East Asian countries present tons of challenges as the topography is not favourable due to the entire region being a culmination of multiple small islands with vast forests but with Malaysia, the conditions vary as it is made up of two parts only and provides a rather smoother on land transportation opportunity enabling logistics and delivery companies to make higher profits here.

6. Greater Accessibility to E-commerce Enablement Solutions

With the constant rise of e-commerce, there also has been considerable growth seen in terms of technological and e-commerce enablement solutions in Malaysia. Internationally renowned e-commerce solutions providers have begun to shift their focus to the rapidly growing e-commerce market of Malaysia, providing sellers immense opportunities to render superior services with best in class supply chain solutions right from automated inventory, order and warehouse management, integrations to leading e-commerce platforms and much more.

In Conclusion 

The future of e-commerce in Malaysia is bright and it is the perfect time for you to begin, advance and adapt to new methods and techniques of providing the best services to your customers. 

Just by working your way with the right approach and with the correct technological assistance, you can grow your eCommerce business, provide superior customer services and experience higher profitability and productivity.

Want to find out more about the e-commerce market of Malaysia, check out our blog on the latest trends going on around the region and the most effective strategies and methods to follow in order to become a top seller in Malaysia.

Explore our platforms:

• Advanced Logistics Tracking and Returns Management Platform
• Automate Reconciliation of Orders, Returns and Payments

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