Managing inventory efficiently is key to the stable growth of any eCommerce business, especially for those using Shopify.

However, many sellers face different inventory management challenges that can negatively impact their operations.

In this article, we’ll explore 9 Shopify inventory issues and provide effective solutions to help streamline your inventory management process and avoid costly mistakes.

Let’s begin!

9 Shopify inventory issues and how to solve them

1. Managing stock levels 📦

Getting stock levels right can be a challenge.

Overstocking leads to wasted resources and unnecessary storage costs, while understocking results in missed sales opportunities and disappointed customers.

As demand fluctuates, finding the right balance becomes even more important.

By predicting the right amount of stock based on sales data and trends, you can keep your inventory at optimal levels, ensuring you meet customer demand without incurring unnecessary costs.

🛠️ How to find a perfect balance?

To ensure your stock levels remain balanced without overstocking or understocking, consider these practical steps:

1️⃣ Real-time tracking: Implement real-time inventory tools that automatically update stock levels as sales occur. This provides an accurate picture of your stock at any given moment.

2️⃣ Automatic reorder alerts: Set thresholds within your inventory management system to trigger reorder alerts when stock levels reach a specific point.

3️⃣ Check slow-moving stock: Review Shopify’s reports regularly (ABC analysis, average sales per day, sell-through rate) to identify underperforming products and adjust stock accordingly.

4️⃣ Forecasting capabilities: Utilize forecasting tools to project demand for different products based on historical data, upcoming events, and seasonal shifts.

💡 Pro tip

Fabrikatör is an advanced inventory management platform that integrates seamlessly with Shopify, helping you optimize stock levels.

Also, Fabrikatör enhances ABC analysis by automatically categorizing your products into A (fantastic), B (moderate), C (poor), and an additional fourth category, D (idle - items not sold in the last 30 days), based on their sales performance.

Additionally, Fabrikatör allows you to set the ABC conditions individually.

This classification helps you to quickly identify best-selling products, optimize inventory levels, and improve profitability by prioritizing resources where they are most needed.

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2. Manual inventory updates leading to errors ✍️

When inventory updates are done manually, whether through spreadsheets or handwritten logs, human error becomes inevitable.

This can lead to inaccurate stock counts, misplaced items, and fulfillment issues.

The result is often customer dissatisfaction and delays in order processing.

🛠️ How does automation help?

To eliminate errors caused by manual updates and improve overall inventory accuracy:

1️⃣ Automated stock tracking: Use inventory management software that updates stock levels automatically, ensuring consistency.

2️⃣ Integration with Shopify: Sync your inventory system with Shopify to ensure that every order placed immediately updates inventory levels in your system.

3️⃣ Barcode or RFID scanning: Employ barcode scanning or RFID systems to ensure real-time and error-free tracking during both stock intake and order fulfillment.

4️⃣ Automated reporting: Set up automated reporting to track inventory levels, sales trends, and other important metrics, which can also highlight any discrepancies.

💡 Pro tip

Eliminate spreadsheets and leverage the barcode scanner with Fabrikator to automate inventory updates.

Fabrikator’s barcode scanning feature ensures real-time, error-free tracking during stock intake and order fulfillment, while seamlessly syncing with Shopify to maintain accurate inventory levels across all channels.

3. Lack of centralized multi-channel inventory management 🌍

Selling across multiple platforms can quickly create discrepancies in stock levels.

When stock is updated on one platform, it may not reflect on others, leading to confusion and missed sales opportunities.

🛠️ What to do?

To centralize and synchronize your inventory across multiple platforms, follow these steps:

1️⃣ Centralized dashboard: Use a multi-channel inventory management system with a centralized dashboard that integrates Shopify, Amazon, physical stores, and other sales platforms.

2️⃣ Real-time synchronization: Ensure stock levels across all platforms are updated in real-time whenever a sale occurs, preventing overselling or stockouts.

3️⃣ Unified reporting system: Use the system’s unified reporting tools to get insights into inventory performance across channels and identify trends.

4️⃣ Unified inventory control: Manage orders, returns, and restocking in one platform, helping streamline workflows and prevent discrepancies across platforms.

4. Slow order fulfillment due to inefficient inventory processes 🕒

If the process for picking, packing, and shipping items is slow, it directly impacts your order fulfillment time.

Delays in picking, packing, and shipping can create backlogs, leading to frustrated customers.

🛠️ How to manage shipments better?

Speed up your fulfillment process and avoid delays by implementing these steps:

1️⃣ Automated picking and packing: Use tools that automate the picking process by locating items faster, reducing manual labor, and speeding up order fulfillment.

2️⃣ Order routing rules: Set up automated rules to route orders to the nearest warehouse or fulfillment center based on stock levels, reducing shipping times.

3️⃣ Integration with fulfillment partners: Integrate your inventory system with fulfillment partners (like ShipHero) to streamline picking, packing, and shipping workflows.

4️⃣ Real-time updates: Ensure that your inventory system updates stock in real-time so that items are ready to ship as soon as the order is placed.

💡 Pro tip

Fabrikator integrates seamlessly with ShipHero, streamlining your warehouse and fulfillment operations.

This integration enhances your shipping process by automatically syncing inventory levels, optimizing picking and packing workflows, and providing real-time updates on stock availability, ensuring efficient, error-free order fulfillment and timely deliveries.

5. Limited forecasting capabilities 🔮

Without proper forecasting, it’s difficult to predict future demand, and this can result in either excess inventory or stockouts.

Businesses often find themselves reacting to market shifts rather than proactively planning for them.

🛠️ How do you forecast your inventory needs better?

To improve forecasting capabilities:

1️⃣ AI-powered forecasting tools: Use AI-driven tools that consider various factors such as historical sales, market trends, and external influences to generate accurate demand forecasts.

2️⃣ Historical data analysis: Analyze past sales and inventory data to identify patterns and forecast future demand based on seasonality and other factors.

3️⃣ Dynamic adjustment: Use software that automatically adjusts inventory forecasts as market conditions change or when new data comes in.

4️⃣ Integrated planning tools: Implement inventory planning tools that integrate with your ERP or accounting software to plan for future stock needs based on real-time data seamlessly.

💡 Pro tip

Fabrikatör's demand forecasting leverages advanced AI algorithms to help you accurately predict future demand, considering past sales data, seasonal trends, and marketing activities.

It continuously analyzes this data to generate dynamic demand models, adjusting inventory levels and purchase orders in real-time to match changing conditions and reduce the risk of both overstocking and stockouts.

6. Inconsistent inventory between physical and online stores 🏪

When inventory is managed separately for physical and online stores, inconsistencies arise that can lead to overselling or stockouts.

Without real-time synchronization, a product sold in-store might still appear as available online, causing discrepancies.

🛠️ What can help?

To ensure your physical and online stores are aligned:

1️⃣ SKU management: Implement an efficient SKU system to categorize and track products more effectively. Assign SKUs based on product type, size, or any other criteria that fits your business needs.

2️⃣ Automated updates: Every time a sale is made, whether online or in-store, stock levels are automatically updated across all platforms, preventing discrepancies.

3️⃣ Centralized reporting: Utilize a centralized reporting tool that provides real-time data on stock levels across channels, making it easier to monitor inventory health.

4️⃣ Warehouse integration: Integrate your warehouse management system (WMS) with your Shopify store to streamline stock movement between physical locations and online orders.

7. Difficulty managing inventory for bundles or kits 📦

Selling bundles or kits is more complicated than individual products because each kit consists of multiple items.

When a bundle is sold, the individual stock levels for each component need to be updated, creating a complex tracking process.

🛠️ Solution to this is to…

To manage bundles and kits efficiently:

1️⃣ Bundle management: Use software that allows you to create and track bundles as a single product, while automatically adjusting individual stock levels for each item in the kit.

2️⃣ Dynamic stock updates: When a bundle is sold, the inventory for each product within the kit is updated, ensuring accurate stock levels for both individual products and bundles.

3️⃣ Easy bundle creation: Simplify the process of creating bundles by setting up predefined kits in your system, allowing for quick updates and restocking when needed.

4️⃣ Cross-channel tracking: Ensure bundles are accurately tracked across all sales channels, preventing discrepancies when selling on multiple platforms like Shopify, Amazon, or physical stores.

💡 Pro tip

Fabrikator simplifies managing product bundles by allowing you to define and track bundles directly within the platform.

With its seamless integration with Shopify, Fabrikatör allows you to define product bundles, and when bundles are sold, Fabrikatör will automatically consider them in its calculations.

This means you no longer have to manually update stock levels for each component, making the bundling process more efficient and error-free.

Simply define, list, and manage your bundles in Fabrikatör, and let the system handle the rest!

8. Lack of cash flow tracking and analytics 💵

Without cash flow tracking, businesses struggle to understand how inventory impacts their overall financial health.

This lack of visibility can lead to poor decision-making regarding purchasing and stock allocation.

🛠️ What can advanced analytics do for you?

To track your cash flow and make informed decisions:

1️⃣ Cash flow integration: Sync your inventory system with accounting tools to track how much money is tied up in inventory, including stock costs, storage, and shipping fees.

2️⃣ Real-time financial reports: Generate real-time cash flow reports that show how inventory investments are affecting overall financial health.

3️⃣ Profitability analysis: Use advanced reporting tools to analyze the profitability of each product, helping you understand which items provide the best return on investment.

4️⃣ Cost analysis: Track the cost of goods sold (COGS) and other inventory-related expenses to assess the financial impact of each product in your inventory.

9. Limited reporting 📊

Many Shopify merchants struggle with insufficient reporting, limiting their ability to analyze key metrics such as sales, inventory turnover, and product profitability.

This restricts the ability to make data-driven decisions.

🛠️ Why are real-time reports important?

To gain deeper insights into your inventory performance:

1️⃣ Comprehensive reporting tools: Use advanced reporting features that provide insights into key metrics such as stock turnover, sales trends, and product profitability.

2️⃣ Real-time updates: Get instant access to inventory data that reflects the most current status, so you can act quickly and make data-driven decisions.

3️⃣ Customizable dashboards: You can customize your reporting dashboards to display the most relevant metrics for your business, from slow-moving stock to best sellers.

4️⃣ Forecasting reports: Generate reports that help you forecast demand and plan for future inventory needs based on historical data and market trends.

💡 Pro tip

Fabrikatör offers 100+ metrics to help you track your inventory, sales trends, and supply chain performance in real-time.

This data helps you make informed decisions, track the health of your inventory, and anticipate potential issues before they arise.

Manage your inventory with Fabrikatör

Fabrikator is a powerful platform designed to help Shopify users optimize inventory management and streamline their supply chain operations.

With Fabrikatör, you can simplify everything from stock management to demand forecasting, ensuring that your inventory is always at optimal levels, preventing stockouts, and reducing inefficiencies across your operations.

By automating key processes, Fabrikatör enables you to make data-driven decisions, eliminate manual errors, and improve overall workflow.

What Fabrikatör provides:

🔹 Automated replenishment: Get automatic restocking recommendations based on custom rules, such as lead times, stock coverage, and supplier details, keeping your inventory balanced.

🔹 Seamless ordering: With just one click, you can convert restocking suggestions into purchase orders, streamlining your procurement process.

🔹 Backorder automation: Continue selling out-of-stock items while they’re in transit, recovering lost sales, and maintaining customer satisfaction.

🔹 Advanced forecasting: Use AI-powered demand predictions to plan stock levels more accurately based on past sales, seasonal trends, and marketing events.

🔹 Real-time analytics: Track over 100 inventory and sales metrics to gain actionable insights that inform smarter decisions.

🔹 Optimized freight planning: Compare freight options to find the most efficient solution for balancing cost and speed in shipping.

🔹 eCommerce platform integrations: Seamlessly sync your inventory across Shopify and Shopify Plus, ensuring smooth management across all channels.

🔹 Financial & operational integrations: Connect with QuickBooks, Xero, and ShipHero to simplify your financial processes and logistics management.

🔹 Analytics and workflow integrations: Connect with tools like Klaviyo to enhance insights and automation and improve your overall business workflow.

📢 Ready to transform your inventory management? 

Try Fabrikatör today or book a demo to see how intelligent automation can boost your business efficiency.

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