Inventory management is the practice of ordering, storing, tracking, and using a company's stock to ensure the right products are available at the right time without overstocking or running out. For eCommerce businesses, getting inventory management right is the difference between smooth operations and constant firefighting.
Every eCommerce business carries two inventory risks simultaneously: stockouts (running out of a product and missing sales) and overstock (holding too much of a slow-selling product and tying up cash in storage). Good inventory management finds the balance — maintaining enough stock to meet demand without the dead capital cost of excessive buffer stock.
Days of cover: how many days of sales your current stock level represents. Below 14 days is a warning signal for reorder; above 90 days (for most products) represents excess stock tying up cash.
Sell-through rate: the percentage of received stock sold within a period. High sell-through indicates good purchasing decisions; low sell-through flags products that may need promotion or discontinuation.
Stock turnover: how many times per year your entire inventory is sold and replaced. Higher is generally better — it means less cash tied up in static stock.
A reorder point is the stock level at which you trigger a new purchase order. It should account for: your lead time from supplier, your average daily sales rate, and a safety stock buffer for demand variability. Setting reorder points per SKU and monitoring them systematically prevents stockouts far more reliably than intuition-based restocking.
A warehouse management system (WMS) provides real-time visibility of your stock across all locations — including stock reserved against pending orders but not yet dispatched. Without a WMS, inventory levels are at best a delayed estimate. With a WMS, every pick, receipt, and return updates your live stock figure instantly.
PackPro's WMS gives all clients real-time inventory visibility through a dashboard that shows current stock, movement history, and reorder indicators. Learn more about our WMS.