The operational infrastructure that scales e-commerce from $1M to $10M. Inventory, fulfillment, returns, forecasting, marketplace operations.
The E-Commerce Operations Playbook: Scaling from $1M to $10M Without Losing Your Mind
You're doing $2M in annual revenue. Sales are growing 30% year over year. Customers love the product.
You're also:
- Stockouts on your best sellers every other week
- Drowning in returns that sit in a corner for months
- Fulfilling orders manually until 11 PM
- Using 6 different spreadsheets to track inventory
- Panicking every time a marketplace changes their algorithm
Sound familiar?
Last year, we worked with an e-commerce company at $1.8M revenue. Manual inventory tracking, 72-hour fulfillment times, 18% return rate, founder personally packing boxes.
Eighteen months later: $6.2M revenue, automated inventory system, 24-hour fulfillment, 8% returns, founder focuses on growth.
Here's the operational playbook that got them there.
The E-Commerce Operations Problem
Why E-Commerce is Operationally Complex
E-commerce companies face operational challenges that pure digital businesses never see:
- Physical inventory is expensive (tying up cash in products sitting in a warehouse)
- Stockouts kill momentum (you lose the sale + the algorithm ranking)
- Returns are inevitable (and operationally painful)
- Fulfillment speed is competitive (Amazon trained customers to expect 2-day shipping)
- Multi-channel complexity (Shopify + Amazon + Walmart + TikTok Shop = chaos)
- Seasonality is brutal (Q4 can make or break the year)
The Typical E-Commerce Chaos
Here's what I see at most $1M-5M e-commerce companies:
Monday:
- Best seller out of stock (again)
- Customer asking "where's my order?" from 3 weeks ago
- Warehouse can't find the inventory count spreadsheet
- Amazon account suspended for late shipments
Tuesday:
- Supplier ships wrong product
- 47 returns arrive with no process to handle them
- Inventory count off by 200 units (where did they go?)
- Discover competitor undercut price, need to adjust
Wednesday:
- Marketplace listing goes down
- Lose $5K in sales before noticing
- Rush to fix at midnight
- No idea which SKU to reorder
Thursday:
- Fulfillment partner raises rates
- Realize margins are now underwater on 30% of SKUs
- Emergency pricing review
- Can't easily calculate true COGS
Friday:
- Black Friday planning starts
- No idea how much inventory to order
- Wing it based on "gut feel"
- Pray it works out
The symptoms:
- Stock levels managed in spreadsheets
- Manual order fulfillment
- Returns process is "deal with it eventually"
- No demand forecasting
- Inventory turns <4x per year
- No visibility into true profitability by SKU
- Can't scale without hiring an army
The E-Commerce Operating System
Component 1: The Inventory Management System
The problem: You're constantly out of stock on winners and overstocked on losers. Cash is tied up in dead inventory. You have no idea when to reorder.
The fix: Real inventory management with forecasting, reorder points, and ABC analysis.
The ABC Inventory Classification:
A Items (Top 20% of SKUs, 80% of revenue):
- Tight inventory control
- Weekly review
- Never stockout
- Faster reorder cycle
- Higher safety stock
B Items (Next 30% of SKUs, 15% of revenue):
- Moderate control
- Bi-weekly review
- Occasional stockouts acceptable
- Standard reorder cycle
- Standard safety stock
C Items (Bottom 50% of SKUs, 5% of revenue):
- Loose control
- Monthly review
- Stockouts expected
- Slow reorder cycle
- Minimal safety stock
- Consider discontinuing
The Reorder Point Formula:
Reorder Point = (Average Daily Sales × Lead Time) + Safety Stock
Example:
Product: Organic Cotton T-Shirt (Size M)
Average Daily Sales: 15 units/day
Supplier Lead Time: 21 days
Safety Stock: 100 units (covers 7 days of sales)
Reorder Point = (15 × 21) + 100 = 415 units
When inventory hits 415 units → Trigger reorder
Order Quantity:
Review sales velocity:
- Growing? Order more
- Declining? Order less
- Seasonal spike coming? Order ahead
Standard Order: 30-45 days of inventory
Fast movers: 20-30 days
Slow movers: 60-90 days
The Inventory Tracking System:
Stop using spreadsheets. Get real inventory management software.
Must-Have Features:
□ Multi-channel inventory sync (Shopify + Amazon + etc.)
□ Automatic reorder point alerts
□ Purchase order management
□ Barcode scanning
□ Inventory valuation (FIFO/LIFO)
□ Reporting and forecasting
Tools to Consider:
$1M-3M revenue: ShipBob, Cin7, SkuVault
$3M-10M revenue: NetSuite, Brightpearl, Odoo
$10M+: NetSuite, SAP, custom ERP
The Inventory Review Cadence:
Daily:
□ Stockout alerts
□ Reorder point triggers
□ Critical low stock (<7 days)
Weekly:
□ A-item inventory levels
□ Open purchase orders status
□ Slow-moving inventory (>90 days)
Monthly:
□ Full inventory count (or cycle count)
□ Inventory turnover rate
□ Dead stock analysis (>180 days)
□ SKU performance review
Quarterly:
□ ABC classification update
□ Supplier performance review
□ Discontinuation decisions
□ Seasonal planning
The Inventory Metrics Dashboard:
Key Metrics:
Inventory Turnover Rate = COGS ÷ Average Inventory Value
Target: 4-6x per year minimum (higher is better)
Days of Inventory = 365 ÷ Inventory Turnover Rate
Target: 60-90 days
Stockout Rate = Stockout Days ÷ Total Days
Target: <5% for A items, <15% for B items
Dead Stock % = (Inventory >180 days) ÷ Total Inventory
Target: <10%
Fill Rate = Orders Fulfilled Complete ÷ Total Orders
Target: >95%
Component 2: The Fulfillment Operations System
The problem: Orders take 3-5 days to ship. You're packing boxes at midnight. No system for picking and packing. Shipping costs are eating margins.
The fix: Systematized fulfillment process with clear SLAs and metrics.
The Fulfillment Decision Tree:
Revenue < $1M/year:
→ Self-fulfill from home/office
→ Manual process is fine
→ Focus: Speed and accuracy
Revenue $1M-3M/year:
→ Self-fulfill from warehouse OR
→ Hybrid: you fulfill direct, 3PL handles Amazon
→ Basic warehouse management system
→ Focus: Process and consistency
Revenue $3M-10M/year:
→ Full 3PL (third-party logistics) OR
→ Self-managed warehouse with staff
→ WMS (Warehouse Management System)
→ Focus: Speed, accuracy, cost per unit
Revenue >$10M/year:
→ Multiple 3PLs (regional distribution)
→ Advanced WMS
→ Focus: Optimization and scalability
The Self-Fulfillment Playbook ($1M-3M):
Warehouse Layout:
Zone 1: Receiving (incoming inventory)
Zone 2: Storage (organized by SKU velocity)
Zone 3: Picking (fast movers at waist height)
Zone 4: Packing (stations with supplies)
Zone 5: Shipping (labeled and staged)
Daily Fulfillment Process:
8:00 AM - Print pick lists (all orders from previous day)
8:30 AM - Pick all orders (batch pick by SKU)
10:00 AM - Pack orders (assembly line style)
12:00 PM - Print shipping labels, schedule pickup
2:00 PM - Carrier pickup
3:00 PM - Process new orders, repeat if needed
Fulfillment SLAs:
- Orders placed by 2 PM → Ship same day
- Orders placed after 2 PM → Ship next day
- Target: 24-hour fulfillment time
- Tracking uploaded same day
Packing Standards:
- Use right-sized boxes (saves shipping costs)
- Branded packaging (worth the investment at $1M+)
- Include insert (thank you + social media CTA)
- Scan barcode before packing (prevents errors)
- Weight check (catches missing items)
The 3PL Playbook ($3M+):
When to Switch to 3PL:
□ Fulfillment is taking >20 hours/week
□ Shipping costs are >15% of revenue
□ You need 2-day shipping to compete
□ Multi-channel complexity is overwhelming
□ You're hiring warehouse staff
How to Choose a 3PL:
- Get quotes from 3-5 providers
- Compare: receiving fees, storage fees, pick/pack fees, shipping rates
- Visit their facility if possible
- Check references from similar-sized brands
- Test with 20% of volume first
3PL Cost Structure:
Receiving: $0.30-0.50 per unit
Storage: $8-15 per pallet per month
Pick & Pack: $3-5 per order
Shipping: Negotiated carrier rates (usually better than yours)
Minimum Monthly: $500-1,000
Total cost typically: 12-18% of revenue
3PL Management:
- Weekly inventory report review
- Monthly performance scorecard
- Quarterly business review
- SLA tracking (accuracy, speed, damage rate)
The Fulfillment Metrics:
Fulfillment Speed:
Order to Ship Time: Target <24 hours
Ship to Delivery Time: Target 2-5 days
Overall Order to Delivery: Target 3-6 days
Fulfillment Accuracy:
Order Accuracy Rate: Target >99%
(Correct items + quantities + address)
Returns Due to Fulfillment Error: Target <2%
Fulfillment Cost:
Cost per Order: Target <$5 for self, <$7 for 3PL
Fulfillment Cost as % Revenue: Target <15%
Packaging Cost per Order: Target $1-3
Component 3: The Returns Management System
The problem: Returns pile up with no process. You're losing money on every return. Can't track why customers return. Some returns sit for months.
The fix: Systematized returns process that's fast, trackable, and minimizes loss.
The Returns Process:
Step 1: Customer Initiates Return
Tool: Automated return portal (Loop Returns, Happy Returns, ReturnGO)
Customer selects:
- Reason for return
- Exchange or refund
- Photos (if damaged/defective)
Auto-decision:
If <$50 and customer wants refund: Refund immediately, ask them to donate/keep item
If damaged: Refund immediately, flag for supplier
If exchange: Process immediately
If standard return: Issue return label
Step 2: Return Received
Receiving process:
□ Scan return label
□ Inspect item (sellable? damaged? wrong item?)
□ Update inventory
□ Process refund/exchange (if not already done)
□ Route item:
- Sellable → Back to inventory
- Damaged → Liquidation or disposal
- Defective → Return to supplier
Step 3: Data Collection
Track in system:
- Return reason
- SKU
- Timeframe (how long after purchase?)
- Inspection result
- Resolution
Step 4: Analysis
Weekly review:
- Which SKUs have high return rates?
- Which return reasons are most common?
- Are returns increasing or decreasing?
Actions:
- High returns due to sizing? → Update size chart
- High returns due to quality? → Talk to supplier
- High returns due to "not as expected"? → Improve photos/descriptions
The Return Rate Targets:
Industry Benchmarks:
Apparel: 20-30% return rate
Electronics: 10-15%
Home goods: 5-10%
Beauty: 5-8%
Your targets should be:
Total return rate: <15% (varies by category)
Return processing time: <5 days
Restockable rate: >70%
Returns due to damage/defect: <5%
The Return Cost Calculation:
Cost per Return:
Return shipping: $6-10
Processing labor: $3-5
Restocking: $1-2
Loss on non-sellable: Variable (25-100% of item cost)
Example:
Product sells for: $50
COGS: $20
Customer returns it
Best case (item resellable):
Return shipping: -$7
Processing: -$4
Lost margin: $0
Total cost: $11
Worst case (item not resellable):
Return shipping: -$7
Processing: -$4
Lost product: -$20
Total cost: $31 (lost money on the sale)
This is why minimizing returns matters.
Return Reduction Tactics:
Improve Product Pages:
- High-quality photos (6-8 images minimum)
- Size charts (for apparel)
- Dimensions clearly stated
- Real customer photos
- Detailed specifications
- Videos if applicable
Set Expectations:
- Accurate product descriptions
- Realistic shipping times
- Clear return policy
- Proactive shipping updates
Quality Control:
- Inspect before shipping (random sampling)
- Track supplier quality issues
- Replace problem suppliers
Smart Policies:
- Free returns (increases conversion more than it costs)
- Extended return window (builds trust)
- Easy exchange process (keep the customer)
- Keep-and-refund for low-value returns (<$30)
Component 4: The Demand Forecasting System
The problem: You order inventory based on gut feel. You're always surprised by demand spikes or drops. You have no idea how much to buy for holiday season.
The fix: Data-driven forecasting with seasonal adjustments and trend analysis.
The Basic Forecasting Formula:
Monthly Forecast = Base Demand × Trend Factor × Seasonal Factor
Example: T-Shirt Sales
Historical Data (units per month):
Jan: 450
Feb: 480
Mar: 520
Apr: 580
May: 650
Jun: 720
Base Demand (average): 567 units/month
Trend Factor (growing 8% month over month):
July forecast base = 567 × 1.08 = 612
Seasonal Factor:
July is typically +30% vs average (summer clothing)
612 × 1.30 = 796 units
July Forecast: ~800 units
Plus safety stock (20%): 960 units to order
The Forecasting Process:
Weekly:
□ Review actual sales vs forecast
□ Adjust short-term forecasts (next 4 weeks)
□ Flag any anomalies (spikes, drops)
Monthly:
□ Update rolling 12-month forecast
□ Analyze variance (why were we wrong?)
□ Adjust seasonal factors based on data
□ Generate purchase orders based on forecast
Quarterly:
□ Major forecast review and update
□ Plan for upcoming season
□ Review supplier capacity
□ Adjust inventory strategy
Annually:
□ Full year planning
□ Budget and cash flow forecast
□ Supplier negotiations
□ New product launch planning
The Forecasting Factors to Consider:
Historical Sales Trends:
- What did we sell last month? Last year?
- Is it growing, stable, or declining?
- What's the month-over-month trend?
Seasonality:
- Is this a seasonal product?
- What months are peak vs. slow?
- How big is the seasonal swing?
Marketing and Promotions:
- Do we have sales planned?
- Are we launching new ads?
- Expected lift from promotion?
External Factors:
- Economic conditions
- Competitor actions
- Market trends
- Supply chain issues
New Products:
- No historical data
- Use comparables (similar products)
- Conservative first order
- Quick reorder based on initial velocity
The Forecasting Metrics:
Forecast Accuracy:
= 1 - (|Actual - Forecast| ÷ Actual)
Example:
Forecast: 800 units
Actual: 720 units
Accuracy = 1 - (|720-800| ÷ 720) = 1 - 0.11 = 89%
Targets:
A items: >85% accuracy
B items: >75% accuracy
C items: >60% accuracy (less critical)
Track monthly and improve over time.
Component 5: The Multi-Channel Operations System
The problem: You're on Shopify, Amazon, Walmart Marketplace, and TikTok Shop. Each has different inventory, different orders, different requirements. It's chaos.
The fix: Centralized inventory with channel-specific rules and automation.
The Multi-Channel Architecture:
Hub: Central inventory management system
Spokes: Sales channels
All inventory lives in HUB
Channels pull from HUB
Orders flow back to HUB
Fulfillment happens from HUB
Tools that enable this:
- Shopify + multi-channel app
- SellerCloud
- ChannelAdvisor
- Linnworks
- SkuVault
Or build custom integrations with Zapier/Make
The Channel-Specific Operations:
SHOPIFY (Your store):
Pros: You control everything, highest margins
Operations:
- Fulfill direct or via 3PL
- Full control over branding
- Customer data is yours
- Can test pricing freely
AMAZON:
Pros: Massive traffic, trust, Prime
Cons: Fees (15-20% + shipping), strict rules
Operations:
- FBA (Fulfillment by Amazon) for Prime eligibility
- Or FBM (Fulfilled by Merchant) if margins tight
- Monitor Buy Box percentage
- Respond to reviews within 24 hours
- Strict performance metrics (ship time, order defect rate)
WALMART MARKETPLACE:
Pros: Growing fast, less competition than Amazon
Cons: Strict requirements, lower traffic than Amazon
Operations:
- Walmart Fulfillment Services (like FBA)
- 2-day shipping required for most items
- Strong focus on price competitiveness
- Less forgiving on performance issues
TIKTOK SHOP:
Pros: High engagement, viral potential, younger audience
Cons: New platform, unpredictable algorithm
Operations:
- Focus on video content and engagement
- Fast fulfillment required (2-3 days)
- Live selling opportunities
- Influencer partnerships
The Multi-Channel Inventory Allocation:
Total Available Inventory: 1,000 units
Allocation Strategy:
Shopify (your store): 30% = 300 units
Amazon: 50% = 500 units (highest volume)
Walmart: 15% = 150 units
TikTok Shop: 5% = 50 units
Why allocate?
- Prevents overselling
- Reserves stock for high-margin channel
- Accounts for channel-specific velocity
Rebalance weekly based on:
- Sales velocity per channel
- Margin per channel
- Stockout risk
The Multi-Channel Pricing Strategy:
Base Price: $50 (your Shopify store)
Amazon:
- Check competitor pricing daily
- Typical pricing: 5-10% lower than Shopify (Amazon fees)
- Use repricing tool (RepricerExpress, Sellery)
- Don't race to the bottom
Walmart:
- Price to win Buy Box
- Typically needs to match or beat Amazon
- Less price pressure than Amazon
Your Store:
- Highest price (no marketplace fees)
- Bundle offers
- Loyalty discounts
- Free shipping threshold
Strategy:
Each channel serves different customer:
- Your store: Brand loyalists (higher price OK)
- Amazon: Convenience shoppers (price matters)
- Walmart: Value shoppers (price sensitive)
Component 6: The Profitability Analysis System
The problem: Revenue is growing but you're not profitable. Can't tell which SKUs make money. Pricing is guesswork.
The fix: SKU-level profitability tracking with full loaded costs.
The True Cost Per SKU:
Example Product: Organic Cotton T-Shirt
Direct Costs:
Product cost (from supplier): $12.00
Shipping to you: $1.50
Duties/tariffs: $0.50
Packaging materials: $1.00
Total COGS: $15.00
Fulfillment Costs:
Pick & pack: $3.50
Shipping to customer: $6.00
Returns (10% rate × $11 cost): $1.10
Total Fulfillment: $10.60
Marketing Costs:
Customer acquisition cost: $15.00
(Blended across all customers)
Marketplace Fees (if Amazon):
Referral fee (15%): $7.50
FBA fee: $4.00
Total Marketplace: $11.50
Platform/Operating:
Shopify fee (2.9% + 30¢): $1.76
Payment processing: (included above)
Overhead allocation (10%): $5.00
Total Platform: $6.76
TOTAL COST: $58.86
Selling Price: $50.00
WAIT. You're losing $8.86 per shirt.
This is why you need real cost analysis.
Correct Pricing:
Cost: $58.86
Target margin: 30%
Required price: $58.86 ÷ 0.70 = $84
Or cut costs:
- Negotiate supplier price: $12 → $10
- Improve shipping: $6 → $4 (via 3PL)
- Reduce returns: 10% → 5% rate
- Lower CAC: $15 → $10 (better retention)
New cost: $45
At $50 price = 10% margin (barely acceptable)
The Profitability Dashboard:
Per SKU:
- Revenue
- Units sold
- COGS
- Fulfillment cost
- Marketing allocation
- Marketplace fees
- Gross margin %
- Contribution margin %
Per Channel:
- Revenue
- Orders
- Average order value
- Total costs
- Net margin
- ROI
Overall Business:
- Gross margin % (target: >40%)
- Contribution margin % (target: >20%)
- Operating margin % (target: >10% at scale)
- Inventory turns (target: >4x)
The Implementation Timeline
Month 1: Foundation
Week 1-2:
- Implement inventory management software
- ABC classify all SKUs
- Set reorder points for top 20% of SKUs
- Document current fulfillment process
Week 3-4:
- Set up returns portal
- Create fulfillment SLAs
- Build initial demand forecast
- Calculate true costs for top SKUs
Month 2: Systemization
Week 1-2:
- Automate reorder point alerts
- Standardize fulfillment process
- Implement returns workflow
- Set up multi-channel inventory sync
Week 3-4:
- Launch weekly inventory reviews
- Create profitability dashboard
- Document all processes
- Train team on new systems
Month 3: Optimization
Week 1-2:
- Review and refine forecasts
- Optimize inventory levels
- Analyze return patterns and fix root causes
- Evaluate 3PL if self-fulfilling
Week 3-4:
- Review SKU profitability, discontinue losers
- Renegotiate supplier terms
- Plan for seasonal inventory
- Scale what's working
Results You Should Expect
Financial Impact
| Metric |
Before |
After (6-12 months) |
| Inventory turns |
2-3x/year |
5-7x/year |
| Stockout rate |
20-30% |
<5% |
| Return rate |
15-20% |
8-12% |
| Fulfillment time |
3-5 days |
<24 hours |
| Gross margin |
30-35% |
40-50% |
Operational Impact
| Metric |
Before |
After |
| Time on fulfillment |
30+ hours/week |
5-10 hours/week |
| Time on inventory |
Ad hoc panic |
2 hours/week |
| SKU profitability visibility |
None |
Real-time |
| Forecast accuracy |
<50% |
>80% |
Growth Impact
| Metric |
Before |
After |
| Revenue growth rate |
20-30%/year |
50-100%/year |
| Operational capacity |
Maxed out |
Room to 3x |
| Dead inventory |
20-30% |
<10% |
| Customer satisfaction |
3.8/5 |
4.5/5 |
Common E-Commerce Operations Mistakes
Mistake 1: Optimizing for Revenue Instead of Profit
"We did $5M in revenue!" Great. Did you make any money? Many e-commerce companies grow revenue while losing money on every SKU.
Mistake 2: Treating All SKUs Equally
Your top 20% of SKUs drive 80% of revenue. Give them 80% of your attention. The bottom 50% might not be worth carrying.
Mistake 3: Free Shipping Without the Math
"Everyone offers free shipping!" Yes, and many go out of business. Build shipping into your price or set a threshold ($75+ free shipping).
Mistake 4: Ignoring Return Data
Returns tell you what's wrong with your product pages, quality, or sizing. Most stores just process returns and never analyze why.
Mistake 5: No Demand Forecasting
"I'll order more when we run low." By then, you've lost 3 weeks of sales, tanked your Amazon ranking, and disappointed customers.
Mistake 6: Death by Marketplace Fees
Amazon takes 15%. FBA takes another 10%. Payment processing takes 3%. Advertising is 15% of sales. You're at 43% before COGS. Do the math.
Your Monday Morning Action Plan
This week:
- Monday: ABC classify your inventory (which 20% of SKUs drive 80% of revenue?)
- Tuesday: Calculate true cost for your top 10 SKUs (are you actually profitable?)
- Wednesday: Measure your fulfillment time and return rate
- Thursday: Set reorder points for your top 20 SKUs
- Friday: Implement a basic returns process
First month goal: Inventory system live + fulfillment under 48 hours + returns process documented.
First quarter goal: Inventory turns >4x + profitability visible by SKU + stockouts <10%.
Frequently Asked Questions
What inventory management system is best for e-commerce businesses doing $1M-10M revenue?
For $1M-3M revenue, use ShipBob, Cin7, or SkuVault ($200-500/month). For $3M-10M, upgrade to NetSuite, Brightpearl, or Odoo ($500-2K/month). Look for multi-channel sync, automated reorder points, purchase order management, and barcode scanning. The right system pays for itself by preventing stockouts and reducing dead inventory.
How do you reduce e-commerce return rates from 20% to under 10%?
Improve product photography (6-8 images minimum, show scale and details), add accurate size charts and dimensions, use customer review photos, set realistic expectations in descriptions, and implement quality control before shipping. Then analyze return reasons weekly—if "not as expected" is common, your product pages lie. If sizing is the issue, fix your size chart. Most returns are preventable.
When should an e-commerce company switch from self-fulfillment to a 3PL?
Switch to a 3PL (third-party logistics) when fulfillment takes >20 hours per week, shipping costs exceed 15% of revenue, you need 2-day shipping to compete, or you're hiring warehouse staff. Test with 20% of volume first. Total 3PL cost typically runs 12-18% of revenue but saves founder time and provides better shipping rates at $3M+ revenue.
How do you forecast demand for e-commerce inventory?
Use historical sales data with seasonal adjustments: Monthly Forecast = Base Demand × Trend Factor × Seasonal Factor. For a product averaging 500 units/month growing 10% with a 30% summer spike, forecast ~650 units. Add 20% safety stock. Track forecast accuracy (target >85% for top SKUs) and refine monthly. For new products, use comparable SKUs and reorder quickly based on initial velocity.
What's a good inventory turnover rate for e-commerce?
Target 4-6 inventory turns per year minimum (higher is better). Calculate: COGS ÷ Average Inventory Value. Under 4 turns means cash is tied up in slow-moving inventory. Over 8 turns risks stockouts but maximizes cash efficiency. Fast fashion might hit 12+ turns, while furniture might be 3-4 turns. Optimize by discontinuing SKUs that turn <2x annually.
How do you manage inventory across multiple sales channels like Shopify, Amazon, and Walmart?
Use a centralized inventory management system (hub) that syncs to all channels (spokes). Allocate inventory by channel based on velocity and margin: 50% to Amazon (highest volume), 30% to Shopify (highest margin), 20% to others. Rebalance weekly. This prevents overselling while reserving stock for high-margin channels. Tools: SellerCloud, ChannelAdvisor, Linnworks, or Shopify multi-channel apps.
E-Commerce Operations Are Your Moat
Two e-commerce companies selling the same product at the same price:
- Company A: 3-5 day fulfillment, 20% return rate, frequent stockouts, 2 inventory turns/year
- Company B: 24-hour fulfillment, 8% returns, 99% in-stock, 6 inventory turns/year
Company B dominates. Better reviews, better rankings, better cash flow, better margins.
Your product gets them to click. Operations get them to buy, stay happy, and come back.
Fix the operations. Win the market.
For more on building operational infrastructure, see our guides on workflow optimization, process automation, and operations scaling.
Need help building operational infrastructure for your e-commerce business? Cedar Operations specializes in e-commerce operations. Let's discuss your needs →
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