Aug 2021

Inventory Records: Definition, Guide, and How-to Record Inventory

Inventory is the heart and soul of your business, and it’s constantly moving throughout the supply chain, including:

  • New batches of inventory entering your warehouse
  • Items getting fulfilled and shipped
  • More inventories being ordered, transported, received, and stored

Along with the type of products you sell, your warehouse location(s), and your inventory’s current value — keeping tabs on ecommerce inventory data and information at all times can be challenging, error-prone, and time-consuming. Yet when the accounting period ends, your accountant is going to expect accurate reporting. 

That’s why online brands ditch the manual work and implement technology that makes record-keeping a breeze.

In this article, we explore:

  • What inventory records entail
  • Why it’s important to consistently track inventory 
  • How to outsource inventory management

What are inventory records?

Inventory records are repositories of data pertaining to each item in a brand’s product line, including:

  • What’s in stock at the SKU level
  • What’s been sold and reordered
  • The product’s value
  • The inventory’s storage location
  • Other information that pertains to a business, such as work-in-process (WIP) inventory data

Each entry must have a description of the SKU along with relevant data. These records are either created manually or digitally.

Why it’s important to keep up-to-date inventory records

Keeping proper inventory records provides better inventory control and visibility into inventory as changes occur.

Since inventory is noted as an asset in a business’s balance sheets, you will be expected to provide accurate inventory information at the end of a fiscal year or accounting period.

Here is why every business owner should be keeping proper inventory records.

Ensures inventory tracking is accurate

Consistently keeping track of what’s leaving and entering the warehouse ensures inventory accuracy and inventory reconciliation.

Inaccurate inventory counts can lead to inventory shrinkage, or when stock is less than the recorded balance in the accounting record, and it can cause major discrepancies that can throw off profit margins and other financials.

Makes inventory accounting easier

Accurate inventory records make the inventory accounting process much more bearable.

Keeping track of inventory value and count is legally required of all retailers and manufacturers, as per the Financial Accounting Standards Board (FASB) and regulated by Generally Accepted Accounting Principles (GAAP).  

By maintaining a proper inventory record-keeping process, you’re also able to track changes in value, so you know how much your inventory is worth at the end of an accounting period.

Helps prevent items from going out of stock

Keeping up-to-date inventory records help you prevent stockouts and have a better understanding on when it’s time to reorder more inventory.

Keep in mind that not having enough inventory can cause out-of-stock issues but storing too much inventory can increase carrying costs  and lead you to potentially accumulate too much dead stock.

Since inventory is constantly moving throughout the ecommerce supply chain, the use of real-time inventory management technology makes it easier to check if all inventory is accounted for when comparing physical inventory and electronic records.

Being able to track inventory without the manual work can reduce risk while optimizing operational costs, including storage fees.

Prevents mistakes from being made based off of bad data

If your records aren’t up-to-date, you and your team risk making important business decisions based on incorrect data.

By using technology to track inventory in real time, you can reduce mistakes by cutting out time-consuming, manual work.

Tracking inventory in real time can be done using inventory management solutions, including inventory apps or a more robust system like ERP inventory software. These systems allow you to aggregate data by connecting your upstream manufacturing activities with your downstream sales.

With real-time data tied to inventory, you’re also given the information needed to identify trends and forecast demand, so you can make better predictions on inventory reorder quantities and levels.

Tips for keeping accurate inventory records

Depending on the number of SKUs you sell, your order volume, and the size of your company, the complexity of inventory record-keeping varies.

No matter how intricate your business is, here are some of the top inventory management strategies you can implement.

Keep physical backups

An inventory audit is defined as the process of checking a company’s actual inventory levels against their financial records to ensure accurate inventory accounting. To make inventory auditing more efficient, it is helpful for retailers to keep physical records of all inventory along with online backups (or vice versa). 

Keeping original physical copies can be a legal requirement in some states. And it also secures your information in case of a situation where your cloud server’s integrity is compromised.

Get input from your accountant on what to record and how

Find an accountant you can trust and get their insights into how to keep inventory records for your business.

In most cases, the information you need during the accounting period includes COGS, raw materials (if applicable), beginning inventory, and the value of ending inventory (what’s left over at the end of an accounting period).

You can also ask your accountant for their advice on how to choose the best inventory valuation method  based on the type of products you sell and your typical sales volume.

Remain consistent in your accounting methods

There are many ways to track and record inventory. No matter what method you choose, the most important thing is to stay consistent to ensure accuracy. 

At the end of an accounting period or financial year, you will need to calculate how much your inventory is worth.

The most common valuation methods in ecommerce include: 

  • FIFO (first-in, first-out)
  • LIFO (last-in, first-out)
  • Inventory weighted average (WAC)
  • Specific identification method

Invest in inventory management software

When it comes to keeping records on inventory, you have two options:

  1. Update records after a designated accounting period (periodic inventory system)
  2. Continuously update the records with every transaction (perpetual inventory system)

As your business grows, adapting a perpetual inventory system is your best bet.

This can be done by investing in an inventory management software, which will help you track inventory flow in real time and record live updates without you lifting a finger.

What a good inventory management software should allow you to do

A powerful inventory management software makes inventory record-keeping a breeze.

By automating the tracking of all inventory and real-time changes, you can optimize inventory to meet demand and improve supply chain efficiency.

With the right software, you can easily download records and custom reports, so you have all the information you need when it’s time to meet with your accountant.

Here is a breakdown of how an inventory management software works.

Real-time views of inventory levels across all channels

As you expand your business, you most likely will branch out from selling exclusively on your online store.

Marketplaces (e.g., Amazon and Walmart) and social media platforms (e.g., Instagram and Facebook) provide direct-to-consumer (DTC) brands different avenues to sell through, so they can broaden their customer reach.

That’s why many merchants implement a multichannel inventory management software, which tracks inventory across channels and aggregates records all in one place. 

If you partner with a technology-enabled 3PL  you get access to built-in inventory management tools that also allow you to track inventory across channels and distribution centers in one place.

This allows merchants to spread inventory across multiple fulfillment centers and be able to track inventory in real time through one dashboard instead of relying on multiple sources.

Automatically generate inventory reports

Arguably, your inventory management software is only as good as the inventory reports it generates. Calculating and tracking these metrics in spreadsheets or through multiple different integrations can be troublesome. 

Inventory management technology automatically aggregates data, so you can pull custom reports whenever you need them.

For instance, many order fulfillment  platform automatically pulls reports and data on SKU velocity, inventory days on hand, inventory turnover rate, and much more. 

Set reorder points based on historical data

Inventory management software allows you to automatically set reorder point notifications, so you can replenish inventory on time without the need to be tracking inventory every hour or manually as each order is placed.

The software pulls insights from historical sales data to give you a better idea of when it will be time to reorder more inventory per SKU, so you can set a predetermined reorder point. 

Aug 2021

20 Best Ecommerce Tools to Boost Sales and Optimize Your Business Operations

How do you double your sales while working in half the time? Many online retailers are recking their brains to find the answer to this question. Yet, the answer is simple: by automating and optimizing business operations with the best ecommerce tools. 

The benefits of automation and ecommerce tools integration have been long proven in successful case studies:

  • 35% of what consumers purchase on Amazon and 75 percent of what they watch on Netflix come from product recommendations.
  • Companies that analyze customer behavior can increase their revenue x2 in comparison with their competitors who do not use analytics tools.
  • Human error is the #1 cause of all order fulfillment issues, which can be completely eliminated with an integrated ERP or shipping software.

Many more success stories integrating third-party apps can be found among Elogic clients. So, we’ve decided to share a list of our favorite ecommerce tools grouped into four different categories: analytics, marketing, business & inventory management, and customer service. Get ready to choose your weapon for ecommerce growth!

What Are Ecommerce Tools?

Ecommerce software, ecommerce platforms, ecommerce tools — these terms are often used interchangeably. However, we’d like to distinguish between them, especially if you plan to continue browsing our blog for more useful insights.

Ecommerce software is an umbrella term for all online programs that drive online store processes. It comprises ecommerce platforms and tools that can be deployed either on-premises or as a hosted SaaS solution.

Ecommerce platforms imply the software that allows you to build your store from scratch. It’s the core of your store with the pre-built front-end and back-end logic that makes it easy for a merchant to conduct basic marketing, business, marketing, and inventory management operations. Such platforms can be hosted and delivered as a complete solution (e.g., Shopify, BigCommerce, Volution); or they can stand as open-source solutions (e.g., Magento, OpenCart, PrestaShop).

Ecommerce tools expand the built-in functionalities of ecommerce platforms. They usually appear as standalone solutions and are integrated into the store to streamline business operations.

We’ve already presented a full-fledged guide on ecommerce platforms and how to choose one. Now let’s focus on the best tools for ecommerce websites. See which ones you should consider investing in once you launch your online business.

Top Ecommerce Analytics Tools 

Remember we said that merchants using ecommerce analytics tools can double their revenue? It’s all because such tools allow you to measure the before and after of your business campaigns. Tracking ecommerce analytics will help you make better strategic decisions.

Here are five top ecommerce analytics tools for stores of any size.

Google Analytics & Google Tag Manager

Although Google Analytics (GA) and Google Tag Manager (GTM) are different tools, they both come in handy when measuring how users interact with your pages and products. GTM lets you manage pieces of code (aka tags) to activate certain features, like Google Ads conversions or Facebook Pixel retargeting. Google Analytics is one of GTM tags providing extensive analytics reports on your website traffic, most popular pages, audiences, etc. 

Google Analytics

GA sample report.

Both GA and GTA are free of charge. There are plenty of guides on the web and even official Google training on how to configure these analytics tools. If you’re pressed on time or just don’t feel like dealing with a complex tag installation process, hire a professional development team to do it for you. 

GTM integration was an important part of the Joie project. Check out the benefits the analytics tool has brought to the brand!

Kissmetrics

Kissmetrics presents a powerful analytics tool for ecommerce in particular. The great advantage of this tool is detailed customer activity reports showing most viewed products, the percentage of searches ending in a purchase, sales by product category, etc. A merchant can also segment audiences and trigger certain events based on users’ behavior (as in sending email reminders about an incomplete purchase).

e-commerce funnel

Kissmetrics sample report. Source: Kissmetrics.

The lowest Kissmetrics subscription fee is $299/month tracking 10k of users. The fee grows alongside the features added to the purchased plan.

Metrilo

The beauty of Metrilo is its multi-service ecommerce strategy. It combines the analytics platform with email marketing and CRM so that you won’t have to switch between apps to view the key metrics and make analytics-driven decisions. You can easily track product performance, explore individual user behavior, as well as segment and target email lists. The built-in smart Assistant reads data and recommends possible actions to retain customers.

Metrilo analytics dashboard.

Metrilo pricing is based on a subscription model and starts at $119/month. A merchant can take advantage of a 14-day free trial. One-click integration with major ecommerce platforms, like Magento, WooCommerce, and Shopify, is also available.

Crazy Egg

Lovers of visual analytics, this is the tool for you! Crazy Egg provides amazing heatmap reports showing when and where people click on your website. Scroll reports will help you find a place for a sweet call-to-action, and website recordings will let you identify navigation obstacles on the path to purchase. A/B testing tool will also allow you to set goals and track conversions before and after the webpage change.

Crazy Egg heatmap. Source: Crazy Egg.

Crazy Egg offers a 30-day free trial and affordable pricing plans (the cheapest one being $24/month). The tool easily integrates with major platforms like Shopify (1-click installation available), Magento, Drupal, and WordPress.

Hotjar

Hotjar is often confused with Crazy Egg for the heatmaps and visual analytics both tools have in common. Still, Hotjar brings together user behavior and feedback. Besides analyzing session recordings and click or scroll maps, you can collect your visitors’ reviews and add customizable widgets and pop-ups. Your customer’s feedback will drive more informed business decisions.

Hotjar poll creation function. 

Hotjar offers a free forever plan for personal use. Other pricing plans come at an affordable rate: Plus, will cost you $39/month (for low-traffic sites & early-stage startups), Business — from $99 to $289 per month depending on the chosen number of daily sessions (from 500 to 2,500 sessions), and Scale — from $389 to $989 per month (up to 40,000+ sessions).

Ecommerce Marketing Tools

Every customer is important. But it’s almost impossible to keep track of everyone without ecommerce marketing automation. Ecommerce marketing tools will let the world know your website exists, drive traffic to it, convert visitors into leads, and retain them as customers.

Many marketing functions are already integrated into some top ecommerce analytics tools discussed above. So, in this section, we’ve picked only those tools specializing in inbound marketing, social media, and other types of marketing.

HubSpot

HubSpot is like a jack of all trades in marketing automation. It touts itself as inbound marketing software and basically fulfills so many functions that any small to mid-sized business retailer can only wish for. Free email marketing, lead generation tools, built-in analytics, premium CMS to create new webpages in a blink of an eye — these and more features can take your marketing up a notch!

HubSpot marketing dashboard. Source: HubSpot.

HubSpot pricing starts at $45/month and depends on the number of sales & marketing features in the package. Many tools, like basic CRM, live chat, and ticketing, can be installed for free.

MailChimp

MailChimp stands primarily as an email marketing service provider, although many other marketing tools have been added in the past few years. Using MailChimp, a merchant can configure email campaigns throughout the customer journey, create designs for new webpages, segment and manage audiences. In fact, MailChimp integration has contributed a lot to the success of our client, Umovis Lab, increasing their sales with email targeting.

Creating a MailChimp targeted email. Source: Torque.

MailChimp pricing plans start free and go up to $299/month, thus, meeting the needs of low- and high-volume retailers. At $29/month, MailChimp also offers a simple website builder with basic marketing features for merchants who only get to know the ecommerce terrain.

Klaviyo

Klaviyo is an all-in-one marketing automation platform targeting specifically ecommerce businesses. Some of its most powerful features include customer segmentation, email automation, targeting, A/B testing, among others. The tool gathers all customer data in a single place and applies data science to it. So, you can predict a customer’s next purchase date, determine the probability of customer churn, or calculate customer lifetime value.

Klaviyo predictive analytics report. Source: Klaviyo.

Klaviyo offers a free tier for emails (<250 contacts) and SMS (<50 contacts). The price increases as you exceed the limit; for instance, a plan with 15,000 email contacts will cost you $350/month.

Kibo Personalization

Kibo Personalization (formerly Certona and Monetate) is a leader in cloud commerce and personalization software. Apart from sophisticated A/B testing and audience segmentation features, Kibo leverages AI in ecommerce. A retailer can set goals, like reducing bounce rate or improving engagement, and let the machine decide which experience should be delivered to a visitor. Shoppers will be notified of the trending, top-selling, or most viewed products.

Product personalization and recommendation powered by Certona/Kibo. See more in our Carbon38 case study.

Kibo Personalization pricing is base on a subscription model and is quoted to each brand individually. Contact the solution provider for more specific pricing info.

Google Ads & Other Social Media Channels

Google and social media are the most obvious (and cheap!) marketing tools to connect with new customers. Retailers can take advantage of Google Ads and Google Merchant Center to see the products featured in SERP. Facebook Ads will also get your catalog closer to the audience and offer instant-shopping options on Instagram.

Google Ads

Elogic has connected Marimekko to Google Shopping feed.

The price for social media marketing tools is always relative: you set your budget on your own. The average cost-per-click rate for Facebook, Instagram, and Google is $0.5 to $2.

Ecommerce Tools for Business & Inventory Management 

Keeping data in a spreadsheet is okay at the start of your business. But the larger you grow, the more difficult it gets to manage things. The following tools will help you ensure no operational task — be it inventory, shipping, finance, or staff issue — slips out of your hands.

Pimcore

Pimcore is a real gem amongst many ecommerce PIM solutions. It centralizes all product information and passes it over to other systems, like ERP or supplier database. Its digital asset management (DAM) tool will ensure consistent brand presence across channels. Workflow management feature will also boost your staff productivity and accuracy throughout the whole product lifecycle.

Pimcore comes in three editions: the free Pimcore Community editions and paid Enterprise Subscription and Unlimited Subscription. Request a quote on the official website for more specific pricing.

Pimcore is one of the best tools for ecommerce stores, but it surely isn’t the only PIM solution in the market. Check out another article on our blog for more examples of the best PIM software for your ecommerce business.

Guides & Advice

Best PIM Software for Your Magento 2 [+5 Tips to Master Magento PIM Integration]

READ MORE

TaxJar

If taxes put you in a tight spot, TaxJar should be your take. It’s one of the best ecommerce sales tax software automating tax compliance across 11,000 jurisdictions. The software calculates tax rates in real time and submits your returns and remittances to every state in which you’re registered. This ecommerce tool is particularly useful for the US retailers selling in different states: TaxJar Magento integration has taken an immense load off our US client Carbon38.

taxjar

TaxJar dashboard. Source: TaxJar.

TaxJar offers three pricing packages: $19/month for clients with reporting and filing requirements; $99/month for sales tax automation and reporting needs; and a custom price for large enterprises requiring more advanced tax reporting features.

Signifyd 

Online frauds can cost you dearly — in terms of both revenue and reputation. Signifyd leverages big data to help you prevent them. The software will identify unusual behavior or high-risk transactions, notify you about an issue, and protect your revenue. You can address the issue yourself or delegate it to your risk analyst team thanks to a built-in activity dashboard.

Signifyd dashboard

Signifyd Admin dashboard. Source: Signifyd.

Signifyd is quite discrete about its pricing, but we know that the provider charges on a monthly basis. Request a quote on the official website for more specific info.

ShipperHQ

ShipperHQ can save you many headaches with shipping operations. For one thing, you can set custom complex pricing rules, ship bulky LTL freight, and get real-time accurate rates from carriers. For another, such features as preferred delivery date & time or address validation will only increase your customers’ satisfaction. In fact, our client Roller Rabbit has seen a reduction in their cart abandonment rate after we’ve integrated a ShipperHQ Address Autocomplete module for them.

ShipperHQ

ShipperHQ advanced features menu. Source: ShipperHQ.

ShipperHQ pricing depends on your ecommerce platform and is paid on a monthly basis. The cheapest plans for BigCommerce or Shopify merchants start at $50/month. A 15-day trial is also available.

Best Customer Service Tools for Ecommerce Merchants

The excellent customer experience (CX) starts with professional, proactive customer service. If you don’t believe us, check out numerous Gartner reports on customer service trends & priorities.

Here are five ecommerce software tools that will help you not only deliver outstanding CX but also outperform your competition in terms of customer service.

Zoho CRM

Out of all Customer Relationship Management (CRM) tools, Zoho CRM will get your attention with its extensive set of features. The software will store your customers’ data, personalize their experience, and automate sales — all to ensure you connect with your customers across sales channels and at any point in a buyer’s journey. The results are instant: the US luxury bridal retailer and our client, Amsale, saw a boost in customer engagement and retention rates soon after Zoho CRM integration.

Zoho CRM pricing is pretty affordable and varies between €20 ($24) and €65 ($78) per month. Those purchasing an annual subscription get an extra discount.

Zendesk

Zendesk is yet another CRM solution that focuses mainly on messaging. You can introduce your ticketing system, messaging & live chat, recorded voice calls, help center, and much more! The software will keep your customers engaged and address your customers’ issues or questions before they arise.

Zendesk offers three types of pricing plans to meet the needs of all retailers. Zendesk Suite is a complete customer service solution that starts at $49/month for SMBs and at $150/month for enterprises. Zendesk Support comes only with foundational support features, while Zendesk Sales adjusts messaging tools to the specific needs of sales reps. Both Support and Sales plans start at a price of $19/month.

Sprout Social

Shortlisted as one of the best ecommerce tools for customer support and satisfaction, Sprout Social will boost your communication with customers on social media. The system will store all social media profiles of your brand alongside user reviews, message tags, scheduled & suggested posts for each channel. This customer service software comes with analytics and reporting, so you’ll be able to evaluate the effectiveness of your communication strategies.

Sprout Social admin dashboard

Standard pricing for Sprout Social is $99/month and rises as more features add up. A 30-day free trial is available for you to test the tool.

Smile.io

If you’re going into overdrive to convert your customers into brand advocates, Smile.io is the best customer service tool for you. Its system of points increases one’s purchase frequency. Its referral rewards attract new customers and boost profitability. The VIP client feature builds brand loyalty. Basically, Smile.io has everything to ensure your customers will keep coming back to you.

Smile.io offers the following plans: Free (only points and referral programs included); Starter for $49/month (for new businesses); Growth for $199/month (for mid-sized businesses who want to drive engagement); Pro for $599/month (for enterprises who want to scale further); Enterprise for $1000+/month.

Chatbots

We’ve decided to skip on specific tool names in this category because basically any chatbot will work to your advantage if chosen right. For instance, Whola wished to customize the chat, so the retailer went with Intercom. Now a user can still interact with a website even outside the retailer’s office hours. Mount-it chatbot runs on LiveChat that gives users a chance to connect with their Facebook account or contact support as a guest. 

Conclusion

One last thing we’d like to mention is how to choose the best ecommerce tool. 

Consider your business model, technical knowledge, and budget. If you’re operating as a fashion retail brand, you might want to focus more on marketing. Meanwhile, inventory management tools would bring much more benefit to a dropshipper or a B2B business.

Find a problem you need to address and look through a set of tools that may work for you. Most well-established ecommerce tools offer a free trial period, so you’ll be able to give it a test run before purchasing.

The aforementioned list of ecommerce tools is not exclusive and may include other third-party apps that boost your business. If you’ve laid your eye on some particular tool, make sure to find a reputable company offering ecommerce integration services

Do you agree with our list of top ecommerce tools or would you like to add your own favorite? Share your feedback in the comments.