Shopify Inventory Management: Tools, Apps and Best Practices for Growing Stores

When Native Shopify Inventory Runs Out of Capacity

Shopify’s built-in inventory tracking covers the basics: stock levels, multi-location inventory, and low stock alerts. For stores with under 200 SKUs selling from a single location, native inventory management is usually sufficient. But as catalogues grow, multiple locations are added, purchase orders become complex, or demand forecasting is needed, native tools hit their limits and a dedicated inventory management system becomes necessary.

Native Shopify Inventory Features

Available on all Shopify plans: quantity tracking per variant, low stock email alerts, multi-location inventory (track stock at multiple warehouses or retail locations), incoming transfers (track stock in transit from supplier), and basic inventory reports (by location, ending quantity, average days of inventory).

Use the built-in transfer function to log purchase orders and update stock when goods arrive. This is workable for small catalogues. The gap is demand forecasting — Shopify does not predict when you will run out based on historical sales velocity.

Inventory Management Apps

Stocky (free, Shopify-owned): Purchase order management, supplier relationships, demand forecasting, and reorder suggestions. Best for stores with straightforward catalogue structures. Integrates natively with Shopify inventory.

Inventory Planner: Advanced demand forecasting using sales history, seasonality, and lead times. Generates purchase order recommendations. Suitable for stores with 50+ SKUs and multiple suppliers. Reduces both overstock and stockouts by predicting need more accurately than manual tracking.

Linnworks: Full multi-channel inventory management covering Shopify, Amazon, eBay, and other channels from a single interface. Best for stores selling across multiple platforms who need a single source of inventory truth.

Cin7 Core (formerly DEAR Inventory): Full ERP-level inventory with manufacturing, assemblies, batch tracking, and landed costs. Suitable for product-based businesses that need more than stock tracking.

Key Inventory Metrics to Track

• Inventory turnover: how many times per year you sell through your full stock
• Days of stock on hand: how many days until a SKU runs out at current sell rate
• Stockout rate: percentage of days a SKU was out of stock
• Carrying cost: total cost of holding unsold inventory (storage + capital tie-up)
• Dead stock: products with zero sales in 90+ days

Demand Forecasting for Seasonal Products

Seasonal products require forward-looking inventory decisions made months before peak. For Christmas-relevant products, your buying decision for Q4 needs to happen in July. Use 2–3 years of sales history (from Shopify analytics or Google Sheets exports) to identify seasonal multipliers — if December typically sells 4x your monthly average, order accordingly with sufficient lead time from your supplier.

Setting Up Reorder Alerts

In Shopify, set “Continue selling when out of stock” to OFF for all products unless you have a pre-order strategy. Set low stock alerts in product settings. For more sophisticated alerting, use Stocky’s reorder point recommendations: it calculates the quantity at which you should reorder based on your lead time and sales velocity, so you never run out.