Objectives of Inventory Management in E-commerce

Objectives of Inventory Management
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Inventory Management System : Importance

The necessity for a comprehensive inventory management system in e-commerce has been accelerated by evolving technologies and changing consumer preferences. The following are some of the most important reasons why it is helpful to every corporate entity:

  • Enterprise Resource Planning (ERP) is made possible with Inventory Management

The ERP software integrates and connects the various corporate processes. Inventory procurement, warehousing, production, human resource, finance, marketing, and sales to one another are all examples of these functions. Inventory management plays a role in this process by supplying the necessary data.

  • Warehouse Management Done Right with Inventory Management

The barcode system, LIFO, and FIFO procedures provide a clear image of the past and current inventory accessible to the organization to maximize warehousing tasks.

  • Well Planned Inventory Valuation 

It allows for accurate assessment of many types of inventory, such as stock on hand, opening and closing stocks, raw materials, and finished goods. The cost sheet is also prepared using this information.

  • Inventory Management Helps with Supply Chain Management

It is responsible for simplifying all warehousing activities and the flow of raw material or stock as part of supply chain management.

  • Manage the Sales Process with Inventory Management

As we all know, sale is a never-ending process dependent on manufacturing goods or services. If an organization’s inventory management is poor, there’s a danger that raw materials for manufacturing will be unavailable.


Reasons why a business must have an Inventory Management System-

Inventory Management Objectives : Easy Fulfilment of Orders

One of the most important goals of inventory management is easy fulfilment of orders. It’s not ideal to have an order for your finished items in hand but not be able to fulfil it owing to a scarcity of inventory. It jeopardises order completion and tarnishes your company’s reputation due to missed fulfilment deadlines.

Inventory must be adequately kept to avoid a situation like this, and an inventory management system can help with that.

Inventory Management Objectives : Reduction of Wastage

Another fundamental goal of inventory management is to reduce waste. The amount of inventory managed in most firms is enormous—from bought raw materials to finished items. Inventory must be handled with extreme caution to avoid losses due to theft, wastage, and other factors.

If an inventory is not adequately managed, theft and other undesirable events will go unnoticed.

Inventory Management Objectives : Forecast of Production

If you’re a product producer, you’re probably aware that there are times when you need to scale production to match market demand and minimize output, particularly as the peak season approaches. Inventory management can help you figure out when to scale up or down your production since it gives you a clear view of how many products are in your inventory at any given time.

Inventory Management Objectives : Better Usage of Capital

No company can afford to keep manufacturing items if there are no purchasers for them, tying up working capital in inventories. Inventory management can help you handle this issue and keep your inventory investment bare minimum. You can do this by using inventory management software to keep track of inventory levels at any given time.

Only when the inventory count goes below this threshold can you resume production for that product. This process allows you to minimize your inventory investments to a bare minimum while not affecting your bottom line.

Inventory Management Objectives : Removal of Slow Moving Goods

Not all of your products would be flying off the shelves in most circumstances. There will be a lot of slow-moving commodities that you will have in your inventory. Any business cannot afford to keep its working capital locked up in such items. 

Another goal of inventory management is to get rid of such slow-moving items. You can mark down the pricing because you don’t want to keep your investment in these things.


Inventory management has become an unavoidable aspect of significant corporations. In addition, many small businesses have adopted keeping track of their inventory and raw materials. However, companies must cope with the following limitations when putting it into practice:


  • Lack of Knowledge: Employees in the receiving and warehousing departments may lack the necessary skills and knowledge to distinguish between regular and seasonal commodities from the entire stock.


  • Expanding Product Portfolios: Customer demand and requirements for a diverse range of items have resulted in a massive growth in inventory quantity, making manual management onerous.


  • Supply Chain Complexity: The company may fail to track stock or items during the supply chain process. Furthermore, maintaining an inventory management system by the business partners is not required, posing a barrier.


Eunimart has designed solutions keeping in mind all the above challenges. Talk to us to learn more about how you can leverage the best out of such technologies and grow your business 2X.

What are the main objectives of inventory management?

The need for various forms of inventory, a time frame for the stock, and costs related to it are typically caused by an excess or understock of inventory. Inventory management’s primary goals are:

  • To consistently provide the necessary materials: Maintaining the necessary inventory to keep the production and sales process running smoothly is the major goal of inventory management.
  • To reduce the danger of material under and overstocking: Inventory management successfully reduces the risk brought on by material under and overstocking. Inventory management seeks to lessen or eliminate losses of materials and stock by keeping the appropriate stock of materials with the utmost care.
  •  To lessen losses damages and misappropriation of materials

Frequently Asked Questions

Why is inventory management important for eCommerce?

Small businesses need inventory management because it helps them manage many locations, avoid stockouts, and maintain correct records. As opposed to attempting to complete them all manually, an inventory system makes these operations simpler.

What is inventory management in e-commerce?

Inventory management aids businesses in determining which merchandise to order when and in what quantities. Inventory is tracked from product acquisition to sale. To guarantee there is always adequate inventory to fulfill client orders and proper warning of a shortfall, the technique recognizes trends and reacts to them.

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