Management + Systems

By Alex Mills, sales and marketing director at ProSKU 

For many smaller and growing eCommerce businesses the world of warehouse management might seem like the dark side, something that only much larger companies need. However, at what point in your business growth do the advantages of a systematic approach to managing your stock start to deliver tangible benefits? The chances are it will be sooner than you think.

If you are selling a small and finite number of items, you might not need a dedicated stock management solution. You buy what you need, when you need it, and send it to the customer when it is ordered. Perhaps you can remember all the information you need in your head. If not, you can probably use a few pieces of paper or a basic spreadsheet.

However, things get complicated as soon as the amount of stock begins to grow. Psychologists have known for some time that we can only retain six or seven pieces of information in our short-term memory. We can, of course, remember far more in our long-term memory. In practice, we pass information we want to retain, either consciously or unconsciously, from our short-term to long-term memory – but that is not an ideal way of running a core
business function.

It is inevitable that stock management requirements will become more complex as a business grows. What if those few items you are selling become ten, twenty, or a hundred? If you are selling items that are manufactured, require some form of adaptation, or are bought in bulk, you are much more likely to need to keep track of your stock. Where did it come from? How many do we have? Where is it now? Is it ready to sell? Who has ordered it? Things like that. Suddenly, and without you doing very much, that is quite a lot of information to remember. Some form of ‘memory aid’ will be quite useful. In other words, some form of stock management system.

There are many reasons why stock management can become complex. If you stock a lot of identical items, it might not be too important to identify each one at an individual level. However, if you need to rotate stock so that the oldest items are sold first, or if you need to ensure traceability through the supply chain, then you will need to know and manage more about an item than its basic identity. Every time you add a new piece of information related to any specific item you increase the complexity.

This is where a proper warehouse management system comes in. It will be a ‘memory aid’, overseeing essential day-to-day stock management tasks and providing structured, consistent and accurate data. The system should be able to interface with eCommerce applications to provide the stock information needed to sell items; link to carrier management systems to deliver items cost-effectively; and interface with back office applications that can provide insights into efficiencies and cost savings to help with business development.

For many businesses, the most suitable solution will be a cloud hosted, software-as-a-service solution – such as ProSKU, which is adaptable to current needs, scalable for business growth, easier and faster to deploy than traditional systems, available with simple and predictable pricing models, and future-proofed by ongoing developer upgrades.