In the first part of this article we covered 6 of the 7 things to consider as part of planning your online company store. If you missed that article please click here (Part 1) to read it. We talked about the products that will be available and their acceptable delivery time. We also discussed how the store would be managed and marketed by both your internal staff and your outside store vendor.

Now we are going to focus on the 7th aspect, and that is managing your inventory.

  1. Managing Inventory

In the 1st part of this article we talked about creating a spreadsheet of all the items that need to be shown in your store. We also discussed the importance of identifying those critical items that must be available on the shelf, i.e. held in inventory for immediate shipment.

Choosing a vendor who will be your partner in managing the inventory in your online store is critical. Armed with the information you gathered in Part 1 of this article you are ready to talk to potential vendors about the inventory. Here are critical things to consider in your conversations:

  1. Can the vendor supply all the products you have listed in your spreadsheet?

    Vendor consolidation is an important part of why most companies create a custom online company store in the first place. When you choose a store vendor, they should be able to be a long term partner for your company, and they should allow you to consolidate suppliers so that you achieve higher levels of customer support and reliability.

    1. Can your company store vendor supply all of your print materials, i.e. business forms, checks, presentation folders, brochures, catalogs, business cards, envelopes, signs, banners, etc.?
    2. Do you use adhesive labels, product labels, custom printed boxes or packaging?
    3. What about all your logoed promotional marketing products, such as tradeshow handouts, customer giveaways, employee gifts and recognition trophies?
    4. Does your company supply corporate logo apparel or uniforms for employees? There’s a big difference between the two, far fewer suppliers can do actual “uniforms” versus traditional logoed apparel.
    5. Or, will you store vendor be doing only the store creation and management, meaning the software that gives you a custom online company store? Some company store vendors will provide the store, but rely on you to deliver the products which the store software will manage. Either way, just make sure you understand how many different suppliers you’ll need to have in order to get all your products.
  2. Will the online company store vendor finance and manage the inventory?

    Let’s assume an online company store distributing $200,000 of products each year will need to hold approximately $30,000 of products in inventory for immediate shipment. Not having to spend the money to create this safety stock can be a substantial saving for you. There could be additional savings in company personnel time if the vendor is experienced in inventory turnover rates and economic order quantities in order to ensure that the agreed to delivery times for each product can always be met.

    If the vendor is willing to finance the inventory, discuss the following:

    1. Who is responsible for ensuring the correct levels of inventory are maintained?
    2. Will the vendor replace inventory as it is shipped to maintain the safety stock or will stock only be replenished at certain times of the month or year? Can the vendor supply examples of managing Safety Stock?
    3. What procedure is to be followed to add or delete items from the company store? When items are deleted, how is the cost of obsolete material calculated and who is responsible for disposing of this material or paying for it?
    4. What resources will the vendor commit to your company store?
    5. What experience does the vendor have in running vendor managed and vendor financed online company stores?
    6. What controls are in place at the vendor to ensure your brands are protected and that only personnel designated by your company can order or use the inventory?
    7. What regular reports will be produced for your company and what is the procedure for requesting ad-hoc reports?
  3. Will you buy the inventory and have the online store vendor manage the distribution of that inventory?

    This is, by far, the most common method of running an online company store. This method requires that you have personnel available to devote time to choosing products for the store and managing the inventory in the store. You would also have to accept the additional costs for mistakes and unplanned obsolescence of inventory.

    If the vendor is not willing to finance the inventory, discuss the following:

    1. Will your company personnel be able to access the vendor’s inventory control system to check stock levels of all your products?
    2. Will the vendor make recommendations when the inventory on a particular product is low?
    3. How much notice is required to introduce new products and who is responsible for obtaining specifications, pictures etc. so the new products can appear in the store catalog?
    4. What is the process for deleting obsolete products in the online company store? How much notice does the vendor require to delete the pictures and specifications in the online store? How long do you have to reconcile and collect any unused inventory from the vendor? How are overages and shortages of inventory to be handled?
    5. As with vendor managed inventory you must also agree on what regular reports will be produced for the company and what is the procedure for requesting ad-hoc reports?
  4. Measuring Inventory Performance of the Store

    The key to a successful online company store is working with a vendor that understands the importance of having your company products available when they are needed. You must partner with a vendor that will work with you in all aspects to ensure success; a vendor that provides a user-friendly store, excellent customer service, and on time shipments- all at an affordable cost for your company. Make sure you ask your potential vendors if the cost changes when:

  • The volume of transactions made through the online store changes significantly.
  • Another vendor provides some of the products offered in the online store.
  • The vendor finances and manages the inventory, compared to your buying the inventory up front without vendor financing.

When choosing your online company store provider, consider They have the experience, knowledge and expertise to work with you to develop your store, control your inventory and ship on time and in full. With them you can decide who owns the inventory; they finance and manage the inventory in the online stores of many customers. And, at the proper level of sales, you don’t even have to pay for setting up or running the store.

They have developed and opened company stores for large law firms, restaurant chains, schools and education providers, manufacturing companies, hospitals, banks, and many other industries. They have the experience to help manage multiple locations, streamline the store creation and implementation process, and guarantee that the store results in both cost savings and time savings for your company and employees. Satisfaction is guaranteed!

Let partner with you and your team.
Contact us at or call 813-290-7721.

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