Running out of stock is one of the most damaging things that can happen to a Shopify store. You lose the sale, disappoint the customer, and potentially send them to a competitor permanently. Effective inventory management prevents stockouts, reduces overstock waste, and keeps your store reliable for customers year-round. Here is how to manage inventory on Shopify properly.
Set Reorder Points for Every Product
A reorder point is the inventory level at which you automatically place a new order with your supplier. Calculate yours using: (average daily sales × supplier lead time in days) + safety stock. If you sell 5 units per day and your supplier takes 14 days to deliver, your reorder point is 70 units plus safety stock. Setting reorder points prevents the scramble of realising you are out of stock only when a customer tries to order.
In Shopify, go to each product variant and set a “Low stock” alert in inventory settings. When stock hits this level, you receive an email notification. For automated reorder workflows, use Linnworks or Inventory Planner which forecast demand and suggest reorder quantities based on your sales velocity.
Use Shopify’s Built-In Inventory Tracking
Shopify tracks inventory natively for every product variant — enable “Track quantity” on each product’s inventory section. Shopify deducts stock automatically with every order and shows you current levels in the Inventory report. For stores with fewer than 500 SKUs, Shopify’s built-in inventory management is sufficient. For larger catalogues or multi-channel selling, a dedicated inventory management system becomes necessary.
Manage Multiple Locations and Warehouses
If you store inventory in multiple locations — your home, a warehouse, a retail shop — Shopify’s multi-location inventory feature (available on all plans) tracks stock at each location separately. You can set which location fulfils online orders, transfer stock between locations, and see a consolidated view of all inventory across all locations from one dashboard.
Use “Continue Selling When Out of Stock” Strategically
Shopify gives you the option to continue accepting orders for out-of-stock products. This is appropriate when you can quickly restock and fulfil — for example, items that take 3 to 5 days to produce. But enable it only for products where you can genuinely fulfil within the expected timeframe. Selling and then telling customers they need to wait weeks for backordered items damages trust significantly.
Conduct Regular Physical Stock Counts
System inventory levels drift over time due to damaged goods, theft, counting errors, and fulfilment mistakes. Conduct a full physical stock count quarterly for small stores and monthly for high-volume ones. Compare the count to Shopify’s system count and adjust. Unexplained discrepancies between physical and system stock are usually a sign of a process problem that needs addressing before it scales.
Use Back-In-Stock Alerts to Recover Missed Sales
When a product is out of stock, do not just show “Sold Out” — show a “Notify me when back in stock” button. Apps like Back in Stock – Restock Alerts collect email addresses from interested buyers and automatically email them when the product is restocked. This converts your stockout into a warm subscriber list and recovers sales the moment inventory returns.
OneOnic builds Shopify stores with inventory management best practices baked in from setup. See our Shopify portfolio or contact us to discuss inventory and operations setup for your store.
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