By Megan Wenzl, SEO Content Manager, Linnworks

Automated inventory management is a tool for high-growth and enterprise retailers to automate the inventory control process. It can be considered useful for retailers who are in the growth phase to use automation to their advantage. As your business grows, you want to make sure you’re not overselling or understocking inventory across sales channels.

In this blog, Linnworks explore what automated inventory management is, the benefits of using it in your business, and what to focus on to ensure you get the most out of it.

What is automated inventory management?

Automated inventory management helps track all inventory all in one place without the requirement of you or your employees needing to take the time to manually track this yourselves. It helps a business manage inventory and is extremely useful when it comes to multichannel selling.

Automation helps reduce errors in managing inventory across all sales channels, simplifies tracking inventory, gives you a static overview of inventory at any given moment, reduces the risk of overselling, reduces excess stock and the chance of stock-outs, and allows for more data-driven business decisions to help future growth.

Having an accurate overview of your inventory can give you the insight needed to make better business decisions that lead to a positive customer experience.

In a recent survey from Linnworks, 77% of retailers agreed that having a centralised platform for managing all channels would improve their business performance. Only 14% of retailers surveyed said they are able to manage inventory from a single platform because of the increase of sales channels (most retailers report using four or more tools to manage all their sales channels). This is particularly important now since recent years saw an exponential increase in the various channels available to shop on.

Benefits of retailers using inventory management automation.


Increased accuracy and efficiency

One small error while manually tracking inventory could lead to big issues down the road including a customer purchasing a product that is sold out. This will lead to a negative customer experience. Using automated inventory management reduces inventory management mistakes. Having this process automated means efficiency in how inventory is tracked.


Essential workers in service and delivery industry with face mask during covid-19 pandemic

With a clear and visible understanding of how much inventory you have across all sales channels, you can efficiently decide what you need more of or less of — both now and in the future.

Better customer experience

Having an accurate count of inventory can lead to an improved shopping journey for your customer. Today’s online shopping consumer has an expectation of convenience.

Linnworks research found convenience is key with many consumers – 76% say convenience is a priority when selecting a retailer (78% value convenience more since the pandemic).

Implementing a focus on inventory management can result in a more positive customer journey, leading to highly satisfied and loyal customers. It’s easy to have issues with sold out items across sales channels like marketplaces when you are tracking inventory manually, having to log in and out of multiple channels, as opposed to tracking inventory in one centralised place with automation.

A consumer assumes they will have accurate information on not only whether or not a product is available, but also when delivery can be expected. Customers expect transparent and open communication while the purchase is being delivered to the customer.  Automating all ecommerce operations including inventory and the shipping and fulfilment process ensures that ecommerce businesses get delivery right.

Improved time management

With no longer needing to take the time to track inventory, means the time of yours and staff can be invested in other ways. Using automated management can mean more time for marketing and focusing on your customers.

Saving money

Automation management can save you money in a few ways.

First, if an item is out of stock, it’s likely not in your best interest to continue to spend money on advertising it. If you’re able to know instantly when an item is out of stock, you can temporarily pause advertising dollars on that specific product.

Out of stock lightbox sign on the dark background

Besides, the money you’re spending on advertising for a product that’s not available, a consumer seeing ads for something that isn’t currently available can cause frustration.

Another way improving inventory management leads to savings is not overstocking products that you might think you need but actually don’t.

What makes for good inventory management?

Good inventory management not only makes things easier for you but also saves you valuable time. Ideally, it can give you real-time insights of your inventory so you can make the right decisions.

Automating tasks

One of the basic but vital roles of inventory management is eliminating your obligation for various timely and manual tasks. Once an order is placed, a good system will work behind the scenes for you.

Forecasting demand

If you can analyse sales patterns, you can get a better idea of what products are needed when and what is not needed when, such as forecasting for seasonality.

Automated management makes it possible to analyse these previous sales patterns, and this can help you with demand planning for the entire year. You’ll have visibility on all order and inventory data across all sales channels.

Having a real-time overview of orders 

Getting an up-to-date look at performance across multiple platforms is vital in making the best future decisions. Inventory management can also allow a product to be listed as “limited availability” or something else to signify that the product is selling fast and in limited quantity.

Produce targeted copy

Automation software can also personalize copy, including promotional copy, to various audiences based on demographics. A report by McKinsey said 80% of consumers want personalisation from retailers.

Categorise inventory

Categorising inventory into a group can allow you to get updates on a specific category. For example, if an item is performing well or even running low, it could signify that it could also be beneficial to increase an order for a similar product in that same category.


Growing and enterprise businesses might consider using automated inventory management to manage inventory efficiently and accurately across all sales channels simultaneously.

Published 11/01/22




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