Shopify Product Management Guide in 2024
A question we receive often is "How easy can I maintain my products in Shopify? Do I have enough resources for that?". So in this blog we want to showcase some of the tools and features that Shopify makes available to its merchants to leverage their Product Management game.
With the latest big update released by Shopify - Shopify Editions | Winter '24 - Shopify has announced that their API can support up to 2000 possible variants per product - a huge increase from the existing 100 variants. This has been a very requested feature and it’s finally here! So it only makes sense to have a look at all the different tools that Shopify merchants have at their disposal.
Managing your products effectively is crucial for any Shopify store owner. Shopify offers a range of tools and features designed to help you maintain an organized inventory, track product performance, and ultimately increase sales. From Inventory Management to Bulk Editor, this guide will cover everything you need to know about Shopify Product Management and why we think the tools at your disposal give the platform an edge over its competitors.
Essential Features:
Inventory Management
Shopify's inventory management system allows for detailed tracking down of individual product listings. This is particularly useful for stores with diverse product ranges, ensuring that you always know what is in stock and preventing overbooking scenarios.
You can add up to 10 different locations (warehouses) and manage the inventory for each one. With Shopify Plus, this is extended to 200 different locations. Especially useful when selling internationally, the management of the inventory can be performed directly in Excel and then imported into Shopify.
With Shopify, you have different states of the inventory: On hand, Available, Committed, Unavailable and Incoming.
Most of the Shopify merchants are using Available, Committed and On hand states in their management flows. Available inventory refers to inventory that you can sell. Committed inventory refers to the number of units that are part of a placed order but aren't yet fulfilled. Unavailable inventory refers to the number of units that are reserved for draft orders, set aside by apps, or other inventory hold reasons, such as damaged, quality control, or safety stock. On hand is the total inventory - Available + Committed + Unavailable.
Easy example: Store A is selling clothing. They fulfil all orders at the end of the day. They have 100 pieces available from their best-seller, the T-shirt X, which has been ordered already 50 times in the last 3 hours and have 20 items set aside for their loyal customers, as draft orders.
- Available quantity: 100
- Committed quantity: 50
- Unavailable quantity: 20
- On hand quantity: 170
The last state is Incoming, which refers to inventory that’s on its way to your location from transfers, purchase orders, or apps. Incoming inventory isn’t available to sell until it has been received and its state has been changed to Available. This is not as used as Available, Committed and On hand, which will be part of everyone’s merchant day-to-day activities.
Practical scenario: One of our clients is using a Loyalty Program to offer products for free to clients who reached a specific level in their Program. We are using the Toki Rewards App for that, which has been great so far and helped us with everything we could imagine. When the free product is unlocked, a draft order is automatically created and Shopify moves, through the Toki app, one item from “Available” to “Unavailable”. This ensures the merchant that his clients will receive the product on time and there won’t be any frustrations along the way.
Product Variants:
Shopify has recently updated its platform to allow merchants to add up to 2000 variants per product. This enhancement is pivotal for businesses that offer a wide range of product options, such as different sizes, colours, or materials.
Great example: Consider a furniture store that offers products in various colours, shapes, margins, and dimensions. With Shopify's expanded variant system, the store can list a single model of a chair with options ranging from colour variations like teal or burnt orange to different materials like leather or fabric upholstery, all under one product listing. Each variant maintains its individual SKU, price, barcode, and inventory settings, simplifying management while providing detailed tracking.Variants also offer an excellent opportunity for upselling. For example, a camera store might list a camera with options to add a lens kit or an extended warranty as variants. This strategy not only enhances the customer shopping experience by providing related products directly but also increases the average order value. A lot of Shopify merchants are doing this.
Product Visibility
Shopify allows you to manage where your products are visible based on sales channels and geographic markets. This flexibility is crucial for tailoring product availability to specific customer segments and maximizing revenue opportunities. Imagine 'Alpine Gear', a sporting goods store that sells winter sports equipment primarily in Switzerland. The store can configure Shopify settings to make certain products visible only in the Switzerland market, thereby optimizing inventory and marketing efforts.
Another interesting example would be an electronics store that might choose to sell certain high-end gadgets exclusively on its Shopify online store, making them unavailable on platforms like Google Shopping or Facebook catalogues to maintain exclusivity and control over pricing.
Both Markets and Sales channels require a prior set-up, and we encourage you to get in touch with us or any other professionals if you need help there.
Product Organization
Shopify Taxonomy and Merchant CustomizationsOrganizing products in Shopify involves using a combination of Shopify’s taxonomy for categories and merchant-specific types.
Product Types and Collections: Merchants can set up product types to aid in filtering on collection pages or for internal organizational purposes. For instance, a clothing store might use types like 'Casual wear,' 'Formal wear,' and 'Sportswear' to differentiate their offerings.
Vendor Management: Utilizing the vendor field is especially useful for stores that source products from multiple suppliers. For example, a multi-brand beauty store might list vendors such as 'L'Oreal' and 'Maybelline,' which can be used for both filtering and creating targeted collections.
Tags and Collections: Tags are invaluable for detailed filtering and categorization within Shopify’s backend, particularly when using third-party apps for enhanced functionality. Collections allow for the manual or automatic grouping of products based on set criteria, making it easier for customers to find related products.
Financials of the Product:
Pricing and Cost ManagementUnderstanding and managing the financial aspects of your products is crucial for maintaining profitability. A lot of merchants are keeping their profit records outside the selling platform due to poor management, but it’s not the case in Shopify.
Price and Compare at Price: Set your retail price and, if applicable, a compare-at price to show customers potential savings, which is an effective sales tactic during promotions.
Cost per Item and Margin Calculation: Knowing each product's cost and margin will help in pricing products appropriately to ensure profitability while remaining competitive. Later, Shopify will help you thanks to its Reports to see exactly how profitable a product has been for your online store.
Additional features that we love:
Bulk Updates:
Bulk Editor is an Excel-like feature built within Shopify, which we can not live without. Everyone’s still using Import & Export features - especially when you collaborate with others - but for small and medium-sized changes of the products that still require time and consistency, Shopify Bulk Editor is a great tool that we love.
In short, is a feature that allows Shopify store owners to update multiple product details simultaneously. This can include changes to prices, quantities, product descriptions, and more. Instead of updating each product individually, which can be tedious and error-prone, Bulk Editor lets you make changes en masse through a simple and intuitive interface.
Biggest benefits:
1. Time Efficiency: The most significant advantage of using Shopify’s Bulk Editor feature is the amount of time it saves. Retailers with extensive inventories can update hundreds or even thousands of products within a few clicks. This efficiency is crucial, especially during peak sales periods like Black Friday or when updating inventory for seasonal changes.
2. Accuracy and Consistency: When updating details for a large number of products, maintaining accuracy and consistency is vital. Bulk Editor minimizes human error and ensures that all changes are uniformly applied across your product range. This consistency is key to maintaining a professional online store.
3. Flexibility in Managing Promotions: Running promotions is a critical part of driving sales. With Bulk Editor, you can run a lot of quick promotions on your Shopify online store across numerous products, apply discounts, or update marketing tags to reflect promotional activities. This agility allows you to respond rapidly to market trends or competitive pressures.
4. Diversity of the information: You can update everything product-related that can be found in Shopify, including the metafields. There are apps we like to use from time to time that make the process even smoother, but Shopify’s Bulk Editor will always be a reliable and free alternative that we will consider.
What online stores benefit the most from the Bulk Editor?
- Stores that frequently adjust their stock levels based on seasonality, sales data, or supply chain updates.
- Online stores that require price modifications. Economic factors often necessitate price adjustments. Whether it’s a supplier price increase or a strategic decision to lower prices to remain competitive, Bulk Editor allows for quick and effective price management across multiple products.
- Shopify merchants that are selling products with multiple variants or are interested in SEO updates: Stores with products that have multiple variants (like size or colour) can benefit immensely from Bulk Editor. Additionally, updating SEO-related fields such as meta titles, descriptions, or Google Shopping fields can be done for many products at once, helping improve search engine visibility and drive traffic.
Shopify Magic:
Shopify Magic is their content-writing AI, created for merchants all over the world who need help with product descriptions. Merchants can initiate the process by simply entering basic product details or keywords. The AI then crafts a complete description that captures the essence of the product, optimizing it for both conversions and SEO.
The tool significantly reduces the amount of time spent on writing, allowing store owners to focus on other aspects of business management. With the ability to manage this tool from a mobile device, updates can be made on-the-go, ensuring that your online store is always up-to-date.
Also, maintaining a consistent brand voice is crucial for customer trust and recognition. Shopify Magic ensures that every product description is aligned with your brand’s tone and style, providing a uniform shopping experience.
As your business grows, so does your inventory. This tool scales with your needs, handling an increasing number of descriptions without sacrificing quality. Whether you have ten products or ten thousand, Shopify’s AI has you covered.
Sales reports & insights based on the Product Management:
If you want to scale up or just have an overview of your product’s performance, you can use Shopify Analytics tools but also the Products Insights from Shopify Product Management. Shopify popularised and pushed a lot the ABC Inventory Analysis, which helps merchants categorize inventory into three segments: A, B, and C. This method prioritizes products based on their impact on overall revenue, allowing business owners to focus resources and strategies on the most valuable items.
We find the Product Sell-Through Rate report on Shopify very interesting. This one shows the percentage of inventory sold during a selected time frame. Suppose you have a Shopify store selling a variety of home decor items or a dropshipping store. Using the Product Sell-Through Rate report, you discover that a particular style of table lamps sold 90% of its stock within the first month of listing, significantly higher than other items in the same category. This high sell-through rate indicates strong customer demand and product popularity. Based on this data, you decide to feature these table lamps prominently in your next marketing campaign, allocating more budget to advertise them on social media and including them in email promotions to capitalize on their popularity and potentially increase sales further. This strategic push can help maintain sales momentum and maximize profitability from a best-selling item.
By combining insights from ABC analysis and sell-through rates, Shopify users can enhance inventory accuracy, reduce carrying costs, and improve overall business efficiency. These tools are instrumental in managing product lines effectively, ensuring that high-demand products are always available while minimizing overstock of less popular items.
Conclusion
Effective product management on Shopify can transform your eCommerce business by improving inventory accuracy, enhancing customer satisfaction, and boosting profitability. Implementing these strategies will not only optimize your product management processes but also position your store for sustained success. Remember, while this guide provides a comprehensive overview, continuous improvement through regular assessments and adjustments to your strategies is vital to staying competitive in the fast-paced eCommerce landscape.
For personalized guidance and advanced customization to fit your specific business needs, consider reaching out to a Shopify expert. We specialize in creating solid Shopify online stores that can be managed with minimal contribution by the merchants. Get in touch with us!
Feel free to delve deeper into Shopify’s inventory management capabilities or explore more about Shopify management apps through the respective detailed guides available on Shopify's official site and other relevant platforms.
