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How to Manage Inventory in Your Dropshipping Store 2024?

How to Manage Inventory in Your Dropshipping Store 2024?
CJApr. 21, 2023 08:58:523316

Are you ready to become an inventory management superstar?

As an e-commerce business owner, you know that managing inventory can be challenging, especially when dealing with those pesky out-of-stock items.

But fear not! This article is going to offer you 16 ways to efficiently manage out-of-stock items to help you navigate this obstacle course and keep your customers happy!


Out-of-stock items can be a real pain in the you-know-what. In fact, sellers suffer an approximate loss of $1 trillion annually due to stockouts, with certain industries experiencing stockouts as frequently as every third shopping trip for customers.


But don't let them bring you down. With the right strategies, you can minimize the impact and avoid lost sales, decreased customer satisfaction, and damage to your brand reputation.

Let's dive into some exciting ways to efficiently manage your inventory and keep your online store running like a well-oiled machine. Get ready to take notes and become an inventory management pro!



1. Prevention Methods

Before we head to the solution, let's discuss how not to fall into this trap in the first place.   


- Set Accurate Reorder Points

This one's a no-brainer, but you'd be surprised how many dropshippers don't properly track their inventory levels.


Make sure to set up reorder points that alert you when stocks are running low and it's time to order more from your supplier or manufacturer.


- Analyze Sales Data

You can't just guess what items are going to fly off the shelves - use data! Track past sales figures, study customer behavior, and analyze trends to accurately predict what products have high demand and which ones don't.


- Monitor Supplier Performance

Don't let your suppliers give you the runaround when it's time to reorder items. Ensure they're reliable and can deliver on time, or you'll risk running out of stock.


Speaking of which, the cash flow, indeed, is a crucial factor that dropshippers have to take it into consideration carefully. Sometimes purchasing inventory leads to a higher risk of upfront spending, especially for dropshippers who’ve just started to scale up their businesses. 


Therefore, it’s essential for you to choose a supplier who supports more flexible ways of restocking like CJ offers a deposit option to preorder inventory and free storage for private inventory.


Dropshippers only need to pay 30% as a deposit for their private inventory so they could make sales first, and the deposit will be returned to the seller's payment account after orders are fulfilled.



- Use Automation Tools

There are plenty of amazing software tools that can help you manage inventory more efficiently - from automatic purchase order generation to tracking shipments in real time.


Investing in a good automation system will save you time and energy in the long run!



2. Inventory Management Tips

Now for the exciting part - managing out-of-stock items! Here are some creative ways to keep your inventory levels in check and satisfy your customers.


- Inventory Tracking

The first step in managing out-of-stock items is to have a clear understanding of your inventory levels.


Use inventory management software or tools to keep track of your stock levels in real time.


This will help you identify which products are running low and which items are out of stock. It will also help you avoid overselling and prevent customers from ordering items that are no longer available.



- Set Up Automatic Alerts

Once you have a clear understanding of your inventory levels, set up automatic alerts to notify you when a product is running low or out of stock.


This will give you enough time to restock your inventory and avoid stockouts. Some inventory management tools have this feature built-in, or you can use third-party tools like Zapier to create custom alerts.


Smart dropshippers also leverage the inventory alter function for their supplier accounts. When selling multiple items in your store, you would love to be cautious and leave a backup plan. 


It’s always better to know when a supplier temporarily can not restock in time so that you still have time to switch to a new one rather than to be notified by customers who found the item they wanted to order was running out of stock.



- Monitor Sales Trends

Dropshippers should closely monitor sales trends to anticipate demand and adjust their inventory levels accordingly.


By analyzing historical sales data and keeping track of current trends, businesses can predict when they will need to reorder products and avoid running out of stock.


- Set up Automated Reordering Systems

Automated reordering systems can help businesses streamline their inventory management process and ensure that they always have enough stock on hand.


These systems can be set up to automatically reorder products when inventory levels fall below a certain threshold, reducing the risk of stockouts.




- Use Pre-Order Apps

Some e-commerce platforms, such as Shopify, make it easy with a Shopify pre-order app that allows your business to continue selling products even when they are out of stock.


These apps replace the "Buy now" button with a "Pre-order" button, allowing customers to place orders for products that are currently unavailable.


This can help businesses avoid lost sales and maintain customer satisfaction.



- Establish Strong Relationships with Suppliers

Strong relationships with suppliers can help dropshippers secure reliable and timely deliveries of products, reducing the risk of stockouts due to production delays or shipping issues. 


So when you are selecting suppliers, you would love to choose a dropshipping-friendly platform that is working on providing as much convenience for dropshippers as possible -


like providing 24-hour online support from human agents to respond to global sellers quickly, offering free product sourcing & private inventory storage so that even beginners are encouraged to go beyond the obstacle and build up their first businesses more easily. 


By working closely with reliable dropshipping suppliers and maintaining open lines of communication, businesses can ensure that they have a steady supply of products to meet customer demand.



3. Communication with Customers

It is essential to communicate clearly with customers regarding out–of–stock items in order to cultivate trust and credibility.


By keeping customers informed of their orders' status, they are more likely to remain content and revisit in the future. Additionally, effective communication can help minimize customer inquiries and grievances.


Here are some suggestions on how best to do this:


- Offer email notifications

A survey of 1,000 employees by Adobe revealed that the average working American spends over six hours a day sending and reading emails.


Compared to social media, email is an exceptionally effective method of reaching out to your customer base all at once.


Customers appreciate updates about their orders. You can offer email notifications to inform customers when the item they want is back in stock.



- Provide estimated restock dates

If you have an estimated date when the item will be back in stock, communicate it to your customers.


This information helps them make informed decisions about whether to wait for the item or to look for alternatives.


- Suggest alternative products

Customers may need the item they ordered urgently, so suggest alternative products they can consider. Providing them with a list of similar items they can choose from can also help improve their shopping experience.


- Offer discounts or refunds for delayed orders

To manage customer expectations, consider offering discounts or refunds for delayed orders. This gesture shows customers that you care about their satisfaction and are willing to take responsibility for the delay.



- Be transparent

Be honest about the status of the item and provide regular updates. Transparency can build trust with customers and reduce frustration.


- Provide options for cancellation

Some customers may choose to cancel their order if the item they want is out of stock. Provide them with an easy way to cancel their order if they choose to do so.


In this case, it's also important to collect customer feedback so you understand exactly why they decided to cancel the order and what you can do better.





To summarize, it is imperative for any e–commerce business to effectively manage out–of–stock items in order to guarantee customer satisfaction and increase sales. Unavailable items could result in lost profits and disappointed customers – proactivity is key when it comes to preventing them.


Do not let your customers walk away and look for what they want elsewhere – be proactive in preventing out–of–stock items.


Dropshippers can successfully manage out–of–stock items by understanding the common causes, maintaining adequate inventory levels, monitoring sales trends, using pre–order apps, establishing strong relationships with reliable suppliers, and communicating effectively with customers.


This will help ensure that they have enough products on hand to meet customer demand and provide a positive shopping experience.



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All-in-one dropshipping solution provider: product supplies, global logistics, free sourcing, POD, video shooting, and other dropshipping-related services.