Future of Commerce Blog

5 Signs You’ve Outgrown Your Current Inventory Management Software


Inventory management is by no means the sexy, glamorous focus of a retail business. Where marketing, sales, and product are the beautiful landmarks in a city landscape, operations and inventory are the underground infrastructures like plumbing that no one particularly wants to pay any attention to.

But, much like pipes and plumbing are essential for a city to function, effective inventory management is essential to a retail business in order to grow and scale.

Here are 5 signs that your business needs an inventory management solution upgrade so that your retail empire can grow, scale, and thrive in this competitive environment

5 signs you’ve outgrown your current inventory management software:

  1. You spent most of your time consolidating data from disparate systems.
  2. You frequently have out-of-stocks and backordered items in your sales channels.
  3. Your cash is tied up in excess inventory
  4. You don’t have a sense of your true inventory.
  5. The business is growing at a rate that your operations can’t keep up with.

Want all 10 signs? Download the full guide here

What is inventory management software, and why do you need it?

Inventory management software is a tool that makes the process of managing inventory — an essential part of any retail business — more efficient through offering various degrees of automation, integrations, and customizations. There are many benefits of having an inventory management solution, but main ones include improved efficiency, better visibility across various channels, increased control over your inventory, and ultimately higher profits.

Read more: What is Inventory Management Software and Does Your Retail Business Need It?

While any inventory management software is a sure step up from old-school spreadsheet systems that can be cumbersome and error-filled, there are a many options when it comes to choosing the right software fit for your business. The most simple way to look at your different inventory management software options are to categorize them into entry-level, integrated & robust, and ERP’s.

Here’s a basic comparison chart on how each of these categories of inventory management softwares stack up against each other:

Entry-level Integrated
& Robust
Feature Sets Basic Advanced Advanced and customized
Price Low-cost
(avg. $49-$200)
(avg. $499-$15,000)
(avg. $75K-$200K)
Implementation Time (Avg) 2 weeks 4-6 weeks 6+ months


While there are pros and cons to each of these options, the right inventory management software should help you gain better visibility and control over your inventory — whether that’s across a simple single-channel operation, or a multi-channel, multi-warehouse, global operation.  In short, an inventory management solution fit for your business can be the key to unlocking scalable growth.

Want to know what solution is right for you? Download our ebook on How to Choose Inventory Management Software for Retail Success
As a small business with only one or two sales channels, entry-level solutions may be the best option to save on cost while still being able to gain better visibility and control over your inventory. As you grow, however, there inevitably comes a point where your inventory management solution is no longer meeting the demands of your high-growth business.

So, how do you know when it’s time to upgrade your inventory management solution to a more robust software that can handle your rapid growth?

1.  You spend most of your time consolidating data from disparate systems.

In the earlier days when order volumes were relatively low, you produced product in-house, and fulfilled directly from your office, this manual process of data consolidation was manageable.

But, as you grow and you begin to start processing hundreds and thousands of daily orders from multiple channels, outsource manufacturing, manage multiple warehouses, and perhaps even work with a 3PL partner, manually consolidating inventory data becomes infinitely challenging.

Solution: If you’re finding yourself spending several hours a day sifting through multiple data sources to get to the bottom of your inventory, you’re risking thousands of dollars lost to inefficient processes and inaccurate inventory data due to human error.

“I’m already saving a lot of time with Stitch. Just the other day, I had to finalize a purchase order for an upcoming delivery and using the data from Stitch’s reporting made it easier than ever before. Usually, I’m pulling data from five systems and plugging it all into Excel and it takes me hours. This time, it took me 15 minutes.”

— Lauren Kutting, Founder & CEO, Life in Play

Stitch centralizes your inventory for accuracy, visibility, and efficiency >>

2. You frequently have out-of-stocks and backordered items in your sales channels.

As a growing brand, you want (and need) to be able to capitalize on every sale opportunity without missing a beat to maximize your marketing dollars. That means making sure that all of your items — especially popular ones — are kept in stock and available for purchase by your customers that you worked so hard to acquire.

Despite this, $634.1 billion was lost in retail sales due to out-of-stocks in 2015.

A large driver of this is the lack of visibility into inventory levels across channels leading to poor inventory planning and reactionary restocks. When you have hundreds and thousands of SKUs and multiple sales channels, having a handle on stock levels for each item through largely manual processes is near impossible.

Solution: Advanced and integrated inventory management solutions like Stitch can provide you visibility into product performance per channel, helping you plan for future inventory and avoiding costly out-of-stocks and backorders.

“With [Stitch’s] preventative measure for our highest volume day, we decreased backorders by 93% from the previous year.”

—  James Hargett, Manager of CX and Fulfillment, Chubbies

Avoid out-of-stocks and overselling with Low-Stock Alerts and Smart Replenishment >>

3. Your cash is tied up in excess inventory

Similar to out-of-stocks, having excess inventory is a common problem among retailers and can be equally detrimental to the growth of your business.

While overstocks may not cut into customer experience and expectations, it does have a significant impact on cash flow and warehouse space by tying up your precious resources in slow-moving inventory. To clear out excess inventory, brands will often have to resort to heavy discounts, cutting into sales margins and contributing to lost revenue. In 2015, overstocks contributed to $471.9 billion lost in revenues.

Solution: If you’re regularly having to clear out excess inventory, it could be a sign that you need better visibility into your inventory to be able to effectively plan, purchase, and allocate stock to your different channels.

“Our inventory is so tight that we’re able to consistently hit the metrics Amazon is looking for. They’re essentially trusting that we’re going to run our warehouse as efficiently as they run FBA.”

— Jim Hobart, Co-Founder & CEO | Alpaca Direct, Stitch Customer

Manage overstocks by easily transferring excess stock to other locations with Stitch >>

4. You don’t have a sense of your true inventory.

‘True’ inventory is a much more complex concept than a straightforward product count at your warehouse or store locations. It encompasses everything from committed stock, reserved stock, restocks on the way, new product shipments, products being transferred to a different location, and much more. Each of these have a quantity and an expected date that you have the opportunity to sell against. Having a handle on this and capitalizing on these opportunities is what helps you sell smart and grow faster as a retail brand.

However, being able to manage all types of inventory across thousands of SKUs takes a superhuman level of discipline and organization without the help of software and a level of automation.

Solution: Advanced inventory management systems like Stitch will integrate with your sales channels and warehouse management tools as well as manage your purchase orders and transfer shipments to quickly and accurately give you a holistic understanding of your ‘true’ inventory.

When you’re selling things, having product and knowing where it is is key and Stitch has become the brain for that.

— Mark Hansen, CEO & Founder | Topo Designs

Know and own your inventory better than anybody else >>  

5. The business is growing at a rate that your Operations can’t keep up with.

Your business can only move at the speed of the slowest-moving piece. In retail, the slowest piece tends to be operations. Where products and new SKUs are being added left and right and Marketing and Merchandisers are moving full-speed ahead to drive sales, Operations is caught working overtime to keep up with growing demand.

Solution: If you’re at a point where you’re struggling to keep up with the rest of the business, or worse — you’re scaling back on sales and marketing to be able to manage existing order volumes, it’s a clear sign to upgrade your inventory management solution to an advanced system like Stitch.

“By expanding into new channels and opportunities with Stitch, our sales numbers have increased while errors have decreased, providing us with a scalable way to react and grow rapidly.”

— Anjulei Aurelio, Business Operations Manager | Young & Reckless

Never miss out on a sales opportunity with Stitch >>

Want 5 more signs you’ve outgrown your current inventory management solution? Download the full guide

Ellie Kulick

Ellie is an experienced Marketing Communications and Content Specialist based out of San Francisco, CA. Passionate about technology and health, she is constantly looking for new challenges in effective communication and creative content development to help businesses grow and engage with current and prospective customers.

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