Stock forecast

Inventory management for stock forecasting is a crucial part of e-commerce success, especially on Amazon. Maintaining an optimal stock balance allows sellers to maximize sales, minimize costs and maintain a positive reputation with buyers.

In this article we will analyze the criteria to be taken into account when making stock recommendations, its changes throughout the evolution of an account, ways to streamline and automate the process, as well as preparation for special events and seasons.

First of all, and before making any recommendations, it is necessary to take into account several fundamental criteria, such as knowing the historical sales data of each product, which will allow us to make a projection of future demand, and to know the supplier's delivery time, as well as its product availability and associated costs. Once we have these criteria in mind, we can make stock recommendations that will allow us to maintain an adequate level of stock without having to invest too much money in it.

Another important aspect is the use of FBA (Fulfillment by Amazon) and FBM (Fulfillment by Merchant) models. In some cases, some products may work better with FBA, while others may be better suited for the FBM model. For example, if we have a product with a high volume of sales and a fast lead time, FBA may be the best option. However, a product with a lower demand and a longer lead time, FBM may be more suitable. It is important to evaluate the advantages and disadvantages of each model and choose the one that best suits the needs of each product.

A hybrid strategy that combines both options may be the best way to leverage the advantages of each program and maximize sales. Here's another example: If the product is T-shirts, a common practice might be to list the sizes with the highest turnover in FBA, while those sizes that give residual sales can be distributed through FBM and not incur long-term warehousing costs.

As for the preparation for special events and seasons, it is also an interesting factor to consider the level of stock for those dates, such as Christmas, Black Friday, Prime Day or Back to School, which are events with a lot of demand where the foresight and responsiveness of a seller are key to the success of a brand. 

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In many cases, it will always be more advisable to incur inventory recall costs than to suffer the well-known problems of stock-outs:

• Lost sales: If a product is out of stock and cannot be sold, opportunities to generate revenue are lost.

• Reputational damage: If a customer wants to buy a product and it is not available, it can have a negative impact on the brand image.

• Operational costs: Repositioning product may incur additional costs, including shipping, handling and storage.

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One last detail to consider is the streamlining and automation of the entire inventory management process. There are several softwares that allow you to have a real-time view of stock inventories, order tracking and the option to receive alerts in case the product is running out of stock. In addition, they allow you to track the costs and profitability of each product, which will allow you to make more informed decisions when managing stock.

At Dendary we have proprietary demand forecasting software that will help you better manage your product inventory and optimize your marketplace, our specialty. We can help you develop the best strategy to succeed in your Amazon sales. 

If you want to know more about these tools in detail, please contact us.