Key Secrets for Never Running Out of Stock on Amazon

Staying in stock is crucial. In this guest article, the Project Verte team discusses ways to avoid running out of stock on Amazon and other sales channels.

Many retailers have been there: it’s peak season, customers are demanding the one product that seems, inexplicably, to be the hot item of the month and you're unable to fulfill it because the product is out of stock.

The dissatisfied customer clicks off of your listing and decides to buy the coveted product from another brand. As more and more customers realize that you're not actually carrying the product, they will head over to your competitor who will soon be known as the better business. This cart abandonment can be a long-term detriment to your success on Amazon.

So how can you avoid this pitfall? The secret is that once you have the tools to avoid stock-outs, it’s actually fairly easy to implement them and have a continually robust SKU count, even during your busiest seasons. Keep reading for our tips to avoid running out of stock on Amazon and beyond.

Get to Know Your Sales Data

This advice might seem obvious, but extracting the most significant knowledge is really the key. These days, it’s simple to obtain the number of orders placed on each sales channel, and thus track your products’ popularity over time.

This information can also provide insights into when certain items have to be re-ordered and which ones aren’t doing as well with customers. If you sell from a physical location, it's also important to differentiate between online and offline sales so you can plan your inventory allocation via warehouse or distribution center.

Tracking your sales data must also become a habit; it’s inefficient to only look at it during your peak months or, on the flip side, only view these analytics in isolation when you have a sudden spike in sales.

The key is to examine the data over a longer stretch of time, continually, so you have a better idea of which products have lasting power and which ones are only popular during a short period of time.

This can allow for overall better business performance and prevent you from jumping to incorrect conclusions about, for example, an isolated sales spike.

Compute Your Metrics and Plan Accordingly

Historical data is the key to planning your sales, computing reorder levels, and stocking well for each seasonal spike. The basic calculation is:

Reorder Level = Average Daily Sales x Lead Time

Essentially, take the average daily sales during a specific time period (or rather, total sales for one month divided by 30), then multiply that by the lead time (the time it takes to receive products from your manufacturer or vendor). Of course, remember to adjust this calculation as needed.

Another important calculation is for safety stock, which will ensure that you're always prepared, even during an unforeseen spike in sales.

Safety Stock = (Maximum Daily Sales x Maximum Lead Time) – (Average Daily Sales x Average Lead Time)

This calculation is for those anxiety-inducing times when you have many orders, but perhaps your vendor or manufacturer is taking a bit longer to get the product to you or the orders fulfilled.

Use Inventory Management Tools

Another great way to stop running out of stock on Amazon is investing in inventory management software. A good tool will only make your life easier and your operations run much more smoothly, allowing you to forecast your inventory accurately over any selected period of time, simplify shipping, and maximize profits. RestockPro, for example, streamlines your FBA inventory management, allowing you to optimize your success on Amazon.

RestockPro includes forecasting functionality to determine your reordering decisions, supplier management features, the ability to print custom FBA labels and stickers, a product bundling optimizer, and much more. This tool can certainly do a lot of the heavy lifting for you!

Get to Know and Love Your Supplier and 3PL

Satisfied customers get what they want, on time, at minimal costs. From a retailer’s perspective, this satisfaction requires a solid relationship with both your manufacturer and your fulfillment center. A loyal manufacturer will always deliver your goods to your fulfillment center on time, with every product accounted for, and hold your hand when you come up against unexpected sales spikes.

Similarly, a well-run 3PL will always fulfill your orders as they come in as efficiently as possible. Ensure that you’re partnering with companies that you can trust and maintain good professional relationships with. Look to see if they have histories of exceeding other partners’ expectations — this is very telling information.

Verte’s fulfillment services and technologies, for example, were made for large spikes in volume. Our automated fulfillment technology (with 99.9% pick accuracy) means that customers will receive the right order, even during your peak season. Furthermore, Verte offers Prime-level shipping, which is a requirement if your business operates on both Amazon and other channels.

Avoid Running Out of Stock on Amazon

Running out of stock on Amazon can be a nightmare for any seller, but thankfully there are many ways to circumvent this situation. Knowing your data, investing in an inventory management tool, and having a great relationship with both your supplier and 3PL are all ways to keep your operations running well and your customers happy.