amazon inventory management mistakes

3 Avoidable Amazon Inventory Management Mistakes

Mistakes are an inevitable part of the process when first joining up to the Amazon seller’s market. The Amazon inventory management is the logistical backbone of business and centre of operations which unfortunately means that errors made here can have some adverse effects on the business in terms of sales, reputation and profits. A lot of work goes on behind the scenes of Amazon’s online markets and the for individual sellers to become successful, they need to devote themselves to the job. Becoming proficient in its use can take some fine-tuning, practice and time although, with information on avoiding three major mistakes, sellers should be able to avoid the worst of it.

Mistake 1: Incorrect Inventory Quantities

amazon inventory management mistakes

Listing inventory and prices is one of the first steps to creating an Amazon sellers account and is critical to get right. The inventory must be listed under an accurate title, with the correct price, an informative product description and in the correct quantities. Inventory quantities must be listed exactly right as they go live immediately and are very complicated to change. The item may need to be deleted and listed all over again.

Once the inventory and its quantities are listed, sales need to be monitored closely. Sellers should keep track of the item’s sales velocity which is the rate at which the item is selling. This gives sellers a good understanding of when the item is likely to be depleted and how frequently they should be ordering more stock.

When ordering more stock there are many important aspects for sellers to consider. Firstly, the rate at which product manufacturers can produce new suppliers. This will have a knock-on effect to shipping and delivery times and the entire length of delivery process needs to be calculated so that the seller knows how many days before stock depletion that they should be ordering new stock. It’s also worth considering how different quantities of stock affect production and shipment times to work out the optimal balance of product quantities and speed of delivery. Sellers should also take into account any seasonal changes or special events that might affect their manufacturing times or sales velocities. If they are manufacturing in China, events like the Chinese New Year may delay production while the run up to Christmas will increase sales velocities. It’s important to keep on track of such events so that there is enough stock to keep inventory numbers steady. 

Although sellers might not want leftover stock sitting for extended periods on shelves, a much worse alternative is to run out completely. “This is known as ‘stock out’ and can cause a decrease in sales as well as a drop-in rankings and listings, potentially losing out to a competitor. Avoiding stock out can be difficult to manage as sellers have to account for manufacturers, delivery times and sales fluctuations but it’s always best to be prepared and have a bit of back up stock to avoid zero quantities of inventory” says Beatrice Allen, a business writer at Paperfellows and Stateofwriting. 

Inventories listed at nothing run the risk of getting ghosted by Amazon. After an extended period with nothing to sell, seller accounts will no longer be visible in listings and customers won’t be able to search them. Increased amounts of time with zero inventory will result in Amazon cancelling the seller account altogether.

Starting a sellers account involves on-the-ball management and great preparation. Running it successfully comes with practice which is why sellers should keep persevering with perfecting their quantity in Amazon inventory management.

Mistake 2: Pricing 

amazon warehouse

First of all, prices must be listed exactly as intended when doing the inventory. Mistakes, such as accidentally listing an item as much cheaper than its supposed to be can cause a huge loss of profits whereas overpricing items may result in no sales. Prices should accurately reflect the item, its quality, and its standing amongst competition: 

The Item 

Make sure the price you set is appropriate in terms of the profit margin. All costs that are involved in its production must be accounted for. This includes prices of materials, manufacture, shipping and delivery and also all Amazon costs and fees. For bigger items, these costs will be more and for bulk items these costs can be shared. It’s up to the seller to do the math and figure out the right price that will still give them a decent profit.

It’s Quality

Don’t sell your product short. The price should reflect the quality of the item. For example, handmade ceramic mugs should cost a great deal more than factory replicas. Combine your pricing with a good product description and some positive reviews to ensure that the product is listed at price that reflects its worth.


Finding a niche in the market is great and as for sellers offering a unique product, the pricing is theirs to choose from. However, competitors are inevitable and at some stage sellers are likely to find similar products that undercut them on quality or price. If a competitor’s product is a similar quality but a cheaper price, sellers will see sales decreasing and should adjust their prices accordingly. “When faced with competitors that are posed to steal clients, businesses should make the necessary arrangements to challenge them. It is more profitable to continue make profits of a smaller size than make fewer sales” explains Jimmy Hardin, a project manager at Australianhelp and Bigassignments.

Price adjustment is the key to the Amazon inventory management. The levels of inventory remaining should have a direct impact on how a seller prices their items. As previously discussed, the least favourable position for a seller on Amazon is to have stock out. If sellers suspect that inventory will soon be running out, they should immediately arrange for more stocks to be delivered. However, timings don’t always match up and mistakes are bound to be made. In these circumstances, inventory prices can be raised. This will slow down sales leaving you enough stock in the inventory to stay afloat until more is delivered. Although some potential customers will be driven away, higher prices is a preferable alternative to a decrease in seller reputation and a drop in rankings. 

Mistake 3: Forecasting

The long reaching arm of smart technology has a solid grasp on opportunities to make running an Amazon based retail business more convenient and easier to uphold. To keep on top of a seller account and the many factors involved in the Amazon inventory management, sellers could opt to use forecasting software. There are many optional features including listing tools, FBA management, sale updates, low inventory alerts and even shipment tracking. It’s a user-friendly and convenient way of streamlining an online sellers account.

Having software that takes ownership of the organisation that goes into running a sellers account can be invaluable. Sellers can set up trackers to help them with the Amazon inventory management and send notifications to remind them to restock as well as the amount they should be restocking by, clear outlines of how much it would cost and the optimal timeframe on which to do it. Additionally, some have options to create automatic purchase orders based on the stock replenishing recommendations so that sellers can hand over the emotional burden to the software and be confident that will be consistently delivered an appropriate amount of stock. These features can prevent a stock out the situation and keep Amazon sellers away from the risk of losing sales and rankings and instead help them build a reputable and stable online business.

The smart technology uses predictions, trends, seasonality and changes in sales velocity to generate sales forecasts and give users an approximation of how much they are likely to sell. Statistically backed predictive data is a useful way to gauge the upcoming popularity of products and update levels of inventory accordingly. Applying growth rates and expected product trends to individual sellers inventory allows for the improved efficiency of stock management and the decrease in eventualities of too much or too little stock.

Some software options are designed for general retail purposes while others are made specifically for amazon sellers. Forecasting technology is useful for businesses of all sizes the software offers sophisticated stock management options for multiple products as well as having combined warehouse options to streamline stock avenues. Another important feature is the detailed product analysis to help sellers see the sales data of each individual product and find areas on which to focus in the future. The software typically comes with a fee but the general rewards that are gained from using the software tend to outweigh any costs.


Reaching and maintaining a good position on the Amazon sellers index takes hard work and commitment. Falling behind can result in months trying to regain lost ground but avoiding the three key mistakes we’ve highlighted can help sellers hold on to their position and work on increasing their reputation.

If you use Amazon FBA to fulfill your orders, it is likely that one of the most difficult things is to make sure that your packaging complies with the very strict Packaging Requirements. The process can be troublesome, especially if you source from China, as you can not be sure that your Chinese supplier will be able to follow the rules and provide correct labelling on all your boxes

If you are looking for a reliable partner who can source your products from some of the best factories in China and who guarantee the compliance with Amazon’s requirements, Yakkyofy is your answer. 

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Molly Crockett is a an expert in marketing and business who writes advice for managers on optimising their business practices at Ukwritings and Essayroo. She also helps with research into the develop of writing and research skills in young people which she teaches at Academized.

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