Megaventory Blog - Online Inventory Management Software, Order fulfillment and Control System
This is the company blog for megaventory, an online software that helps small businesses that buy, sell and manufacture physical products to manage sales, purchasing, manufacturing and inventory. We blog about new features and updates but also about enterprise software, small businesses, cloud computing and the industry in general.

Wednesday, February 14, 2018

"Out of Stock": 3 Inventory Management Horror Stories You Need To Learn From


About The Author

Bruce Harpham offers content marketing for B2B SaaS companies. His work has been published in CIO, Infoworld, ProjectManagement.com and IT World Canada. He is the author of “Project Managers At Work.”



Inventory management failure is no theoretical problem. In fact, it’s still with us in 2018. Let me share an example:

Earlier this year, I was shopping for spinach at one of the larger supermarkets in my neighborhood in Toronto. The only options were salad greens… But like Popeye, I prefer spinach!

I ended up tracking down a store employee who explained the day’s produce shipment had been delayed 9 hours. He went to the storeroom and handed me a fresh box. The store managed to recover from their inventory problem.

Here’s the problem:

Ecommerce customers have other options one click away (Amazon Prime!). That means you have less room to maneuver and recover if run out of inventory.

Run out of stock once and your loyal customers may forgive you and come back later. Do it too many times and you’ll have to rebuild that customer base. If your reputation for inventory problems spreads, your business may be doomed.

Inventory management failures, like all tragedies, has many causes. Learn the early warning signs from these horror stories and you’ll be able to keep your customers coming back for more.


My Wedding Décor: how inventory problems shifted their strategy





Remember Chris Anderson’s best selling book “The Long Tail”? I remember picking it up at an airport and reading it with excitement. Endless choices! This will be great!

The reality of endless inventory has two problems. First, there’s a real cost for businesses that have to manage that quantity of physical inventory. Second, psychological research has found that most people are overwhelmed by too many choices and do not buy.

My Wedding Décor, an Australian company that provides wedding clothes and products, experienced rapid inventory growth. Elizabeth Hollingsworth, the company’s founder, put it this way in Practical Ecommerce: “When the website launched in April 2015, it began with 80 products, which had grown to almost 500 products at the end of 2016.”

If coping with a rapidly growing inventory of products wasn’t enough, here’s what happened next:

“One supplier whose original rental threshold was $200 increased it overnight to $500. This forced me to delete many of their lower-priced products that would have required a ridiculous number of units hired to reach their threshold.”


Whether or not you’re in the wedding industry, you can draw inventory management lessons from My Wedding Décor. You never know when a supplier will change the rules on you. You can reduce the impact of such a change on your business though. How?

Use a robust inventory management software solution like Megaventory and do your own analysis regularly. That proactive approach will make it easier to keep your business growing when supplier problems hit you.


Inventory management is the only way to win in India’s grocery ecommerce market


In the dotcom era, several companies attempted to make grocery ecommerce work. Yes, Webvan failed to achieve success as a grocery e-tailer despite railing $800 million.

Despite those early struggles, there is demand for the service. The category has found a following - as of 2017, 7% of Americans order their groceries according to AdAge. How are the winners in grocery ecommerce making it work?

It all comes down to customer expectations and fine tuned inventory management.
Amazon has the bar high for ecommerce. Customers expect their orders to be delivered fast and in great condition. With grocery ecommerce, your inventory cannot sit on shelves for weeks or months even with great refrigeration. A recent surge of investment in grocery ecommerce produced few winners.

Is there a path to win in grocery ecommerce? Yes! That solution lies in mastering inventory management:

“The startups that shut shop followed the on-demand hyperlocal mode, which is a ridiculous business model. That’s why they failed. BigBasket survived because it had its own inventory, distribution centre and directly distributed orders to the customer. That is the business model that can be sustained,” says Arvind Singhal of Technopak.

Hundreds of online grocery startups shut shop since 2015, why are unicorns now betting big?


Investing in inventory management is one reason why BigBasket is winning in the market. Companies in this category are known to spend heavily on customer acquisition. That leaves no margin for error in keeping inventory moving.

For our last example, let’s go outside of the ecommerce field.

What if you had a successful national brand and you wanted to expand? Opening stores in another country shouldn’t be that hard, right? Let’s dive into the Target Canada story next.


Target Canada’s Epic Inventory Failure


In the ecommerce field, it’s easy to dream about expansion. You just add capacity with your outsourced providers and call it a day, right?

In reality, it’s not always that easy. In fact, even companies with a strong brand struggle avoid inventory management failures. Target, a retailer with nearly 2,000 locations in the USA, recently failed in its expansion to Canada. The failure cost millions of dollars and badly hurt the company’s reputation. The failure is all the more notable because many other large American retailers - Whole Foods, Wal-Mart, Home Depot to name just a few – have been successful in Canada for years.

Fundamentally, inventory and supply chain failures lie at the heart of Target Canada’s failure. Let’s dig in and find out what these inventory management problems looked like at the ground level.

According to Canadian Business:

[Target's] concern was that with severe supply chain problems and stores facing the prospect of patchy or empty shelves, Target would blow its first date with Canadian consumers

It didn’t take long for Target to figure out the underlying cause of the breakdown: The data contained within the company’s supply chain software, which governs the movement of inventory, was riddled with flaws. At the very start, an untold number of mistakes were made, and the company spent months trying to recover from them. In order to stock products, the company had to enter information about each item into SAP. There could be dozens of fields for a single product. For a single product, such as a blender, there might be fields for the manufacturer, the model, the UPC, the dimensions, the weight, how many can fit into a case for shipping and so on. Typically, this information is retrieved from vendors before Target employees put it into SAP. The system requires correct data to function properly and ensure products move as anticipated.

A team assigned to investigate the problem discovered an astounding number of errors. Product dimensions would be in inches, not centimetres or entered in the wrong order: width by height by length, instead of, say, length by width by height. Sometimes the wrong currency was used. Item descriptions were vague. Important information was missing. There were myriad typos. “You name it, it was wrong,” says a former employee. “It was a disaster.”


What’s the lesson from Target Canada’s inventory management horror story? Even if you have all the inventory you need in stock, bad inventory data can kill your business. Bad inventory data means your staff (or outsourced providers) have to work much harder to ship products. The likelihood of disappointing customers is high.

What’s next for your inventory management process?

If you’re growing and want to keep your customers coming back, it is a critical function to get right.




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We love conversation so if you'd like to share your own inventory horror stories, write a comment below or tweet us!

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Monday, January 29, 2018

Megaventory integrates with 1,000 apps!



Getting your work done as a modern business requires the combined use of many apps.

You may have a CRM app to manage communications with your clients, an e-mail marketing tool to automate your mailing lists, an inventory management system to streamline your supply chain operations and order fulfillment, and an accounting platform to track your payments and keep your books updated.

While all these apps can reduce workload greatly, wouldn’t be awesome if in some way they could also talk to each other, automatically?

Now this is absolutely possible!


Streamline your Operations with Megaventory Zaps


Megaventory now connects to 1,000 other web tools, thanks to our Zapier integration.

With workflow automation tool Zapier, you can set up your own integrations called “Zaps”. Zaps will automatically send information from one tool to another, so you’ll spend less time manually transferring data between business tools and can dedicate more focus to creative, big picture tasks.

The following are only some of the available zaps:


3 More Integrations to Try Out


Since 1,000 apps is a quite overwhelming number, we’d love to mention three apps that work complementary with Megaventory and you can try out today.


Process Street


Process Street is a business process management tool that makes it easy for businesses to create and collaborate over recurring checklists like client onboarding, sales qualification, and supplier evaluation. It helps teams improve consistency because every member knows exactly what they’re supposed to be doing next, and task progress is visible to managers.

But how to use the integration with Process Street?

Integrations save you time from mundane tasks like data entry, one of the biggest time wasters. One tedious data entry task is updating your inventory management software with the data of a new supplier. If you have already filled this data while evaluating suppliers you can save time from doing this again in Megaventory, by having Zapier do the filling in for you.

In the same logic, with Zapier you can trigger a reversed zap. For example, if you have in place an onboarding process for every new customer, you can set it up to create a new checklist each time a new client is created in Megaventory.


SurveyMonkey


Even though a customer bought from you once, this doesn’t necessarily mean that they will do so again! Often, customers are dissatisfied with the purchase or delivery process, and their previous experience with your business prevents them from going forward with a second purchase. Many times angry customers become vocal about their feeling, but it is quite often that a customer will decide to remain silent on this and just don’t ever do business with you again. As a business owner, you may see your churn numbers growing up and have absolutely no clue why.

The answer? Just ask them with a survey!

SurveyMonkey is one of the most popular survey platforms, allowing you to easily build, send and monitor your surveys. Although it is commonly used for research, did you know that you can also use it to gain valuable information on your customers?

For example, you can set up a zap to send a survey about their recent purchase, each time a new client is created in Megaventory.


Intercom


Intercom is a popular CRM solution and one we use ourselves and love. You can use it to set up a live chat on your website (customers with unanswered questions often means abandoned carts!) or/and streamline your e-mail marketing efforts.

How to use Intercom integration?

Data entry is a tedious task so the more you can eliminate, the better! With this integration, you can set a zap to automatically update a company or user in Intercom, when a client in Megaventory is updated and vice versa. That way you are always sure that your customers’ data are always up to date, and your messages reach the maximum number of people.

A last note


With so many available integrations the possibilities for automation are endless. To help you out on this, Process Street has created a thorough guide on business process automation through Zapier. This guide will walk you through several examples of business process automation being used right now by startups and enterprises, and help you start saving time and money today.

So, why don’t visit Zapier’s page and experiment with the available triggers and actions?

If it is too overwhelming (the options are THAT many now!) just send us a message at support@megaventory.com and we will respond with the best combination of triggers/actions to achieve your desired result.


Thursday, January 4, 2018

Why Customers Leave: Megaventory’s Study on Churn



The main ambition for most – if not all companies – is to reach more people and grow their client base. In the mind of many, it’s simple mathematics.

More customers means more revenue. Seems reasonable, right?

Well, not exactly.

According to various studies, it is actually more profitable and cost-effective to retain and satisfy existing customers, rather than constantly trying to attract new ones. Nevertheless, many companies tend to relax when they see their rate of new acquisitions growing up and neglect to pamper their older customers.

If you are guilty of this mistake and your company is in the SaaS industry, this mini e-book is for you!



Why Customers Leave?


In recent literature, there is a variety of reasons why paying customers might cut their ties with your business. The most common ones can be summarized in the following list:
  1. Bad customer service
  2. Poor on-boarding experience
  3. Missing feature
  4. Usability issues
  5. Bugs or other technical issues
  6. Unexpected Inconveniencies
  7. No Loyalty Programs
  8. Customer-related issues
When a customer stops using a subscription service that they are subscribed to, it is generally referred to as “churning” or “churn”.

A similar term is churn rate, which refers to the proportion of subscribers who leave a supplier during a given time period. In other words, churn rate is the number of the customers you lost over the number of customers you initially started with.

But why calculating churn is important?

Churn is a possible indicator of overall customer dissatisfaction, cheaper and/or better alternatives, more successful marketing by competitions, or reasons having to do with the customer lifecycle.
As resources and time are limited, knowing the reasons of churn, i.e. where you fall behind, you can allocate your team members and funds where it will matter the most.


Megaventory’s Case Study


But what new does this case study add?

Most studies about churn tend to focus on how to predict and identify the customers who are about to churn and what (mainly marketing) actions can prevent the churn.

Our approach is slightly different: we asked ourselves first “why do people stop using a product?” Starting from there we created a series of metrics to investigate the possible reasons that lead our former customers to stop using Megaventory and to understand which of them are actually statistically important.

In other words, we wanted to find out what seems to have the biggest impact on churn.

It can be summarized in the following metrics:

  1. Time to cancellation
  2. Pricing plan and number of users
  3. Use of features: cards and reports
  4. Last subscription package
  5. Missing feature
  6. Reported bug or technical issue
  7. Demographic factors

Addressing these 7 key metrics we hope to be able to:

  • predict possible churners better and be able to take proactive measures to retain valuable customers, and 
  • understand what needs improvement on the product (features, usability, on-boarding, payments options, etc)

As many SaaS companies have a similar business model, checking our Megaventory’s case study might be beneficial for the SaaS entrepreneur, founder, or developer that wants to reduce the number of canceled subscriptions. Note that only one of the possible reasons is Megaventory-specific (Cards and Reports – no 3) – the rest are easily applicable to other SaaS companies too.

Even if the metrics don’t directly correspond to your business model and other industry details, it may still be educational to see how we did our statistical analysis and be inspired for your own analyses.

Click the button below to start reading Megaventory's Case Study:




We love conversation so if you have any feedback or business stories you'd like to share with us, write a comment below or tweet us!

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