Magento Inventory Management: Top 10 Extensions and Strategies

Magento Inventory Management: Top 10 Extensions and Strategies

Did you know effective Magento inventory management can increase customer satisfaction and reduce cost spendings? There is a wide range of inventory management systems and extensions that seamlessly integrate with Magento platforms. This article provides practical tips to streamline your Magento 2 Inventory, making the entire process more efficient.

Key Takeaways

  • Inventory management in Magento helps ensure accurate order fulfillment, increased customer satisfaction, and organized warehouses.

  • Magento's top 10 inventory management extensions include tools like multi-warehouse inventory management, and advanced stock tracking, etc.

  • Tips for effective inventory management in Magento include implementing just-in-time (JIT) techniques, using the first-in-first-out (FIFO) method, setting par levels, and conducting ABC analysis.

  • Dropshipping helps reduce costs and utilizes demand forecasting tools for better inventory planning.

Tips for effective inventory management in Magento include:

  • Utilize the Just-In-Time (JIT) technique: Order and receive goods just before they are needed for production or sale.

  • Implement the First In, First Out (FIFO) method: Sell the oldest products in your stock first.

  • Use Par levels for inventory replenishment: Set minimum quantities for each product.

  • Conduct ABC Analysis for efficient stock management: Prioritize inventory based on value and significance.

  • Consider drop shipping: Keep products physically out of stock and forward customer orders to suppliers.

  • Utilize demand forecasting tools: Predict future demand for your products.

Importance of Inventory Management for Magento 2

Key benefits of effective inventory management in Magento 2 stores

Inventory management is crucial for Magento 2 stores as it ensures exact order fulfillment. It also improves inventory planning and control. Here are some reasons you should consider it:

1. Exact Order Fulfillment

Filling orders properly is key in any e-commerce store. In Magento 2, you ensure that all items go out as requested. The order system helps you keep track of what you have. It tells you if an item is low or out of stock already.

This approach saves time and ensures customer satisfaction by providing the customers the right products. It mitigates the risk of order mix-ups. It also discusses the issues related to the accidental shipment of incorrect items.

2. Improved Inventory Planning and Control

Better planning and control of inventory is a great way to manage the Magento stock amount. It allows store owners to keep track of stock levels in real-time. This means they know when to order more items or stop orders to avoid excess. They manage by setting the stock quantity for each product in their Magento 2 online store. With this, there is no risk of running out of products or having too many that don't sell.

3. Increased Customer Satisfaction

Optimized inventory management ensures customer happiness as they can promptly acquire their desired products. Nobody appreciates delays caused by items being out of stock. On-time delivery significantly enhances overall customer satisfaction.

You can display product availability so customers are notified when an item is in stock. It enhances transparency, helps customers make informed purchasing decisions, and supports your business in meeting its goals.

4. Organized Warehouse

An organized warehouse is crucial for efficient inventory management in Magento 2 stores. Maintaining a well-organized space allows you to locate and access your products easily.

You can get faster order fulfillment and improved customer satisfaction. With this, you can prevent overstocking or running out of popular items.

If you organize everything, you can streamline operations and enhance productivity in your e-commerce business.

5. Minimized Financial Resource Obstacles

Efficient inventory management in Magento 2 stores helps reduce the blockage of financial resources.

E-commerce businesses can prevent overstocking by closely monitoring stock levels and implementing efficient methods such as Just-In-Time (JIT) and First In, First Out (FIFO). This approach helps manage excess inventory and ensures a smoother inventory flow.

It ensures businesses allocate their financial resources towards other important aspects like marketing, sales channels, customer experience, or product lines and not to unsold products. Streamlining inventory management ultimately leads to more sales velocity and improved business operations.

Top 10 Inventory Management Extensions for Magento

List of top 10 Magento inventory management extensions

  1. Magento 2 Inventory Report by Bsscommerce

  2. Multi Warehouse Inventory by Amasty

  3. Magento 2 Multi Warehouse Inventory by Aitoc

  4. Advanced Inventory by Wyomind

  5. Advanced Inventory Extension for Magento by CMSmart

  6. Magento 2 Inventory Managment by Magestore

  7. Inventory Extension for Magento 2 by Boostmyshop

  8. Inventory for Magento 2 by MageMob

  9. Multi-Warehouse Inventory by SafeMage

  10. Inventory Management by Veeqo

Tips for Effective Magento Inventory Management

Here are some effective ways to manage your Magento inventory:

1. Utilize the Just-In-Time (JIT) technique

To effectively manage inventory in Magento, utilize the Just-In-Time (JIT) technique. Order and receive goods just before they are needed for production or sale. By adopting JIT, you can minimize excess stock. With this approach, you order based on customer demand.

By implementing this in your Magento inventory management, you can always ensure you have the right product stock option settings or minimum qty.

2. Implement the First In, First Out (FIFO) method

How to implement the FIFO method for effective Magento 2 inventory management

Implementing the First In, First Out (FIFO) method is crucial to managing stock inventory. This means you should sell the oldest products in your stock. You sell the older one first before selling the newer ones. By following FIFO, you can ensure your products stay active and updated.

It reduces inventory waste and potential losses. It also helps maintain product quality and customer satisfaction by offering fresher items. Overall, this method in your Magento store helps streamline operations and improve inventory management.

3. Use Par levels for inventory replenishment

To manage inventory in Magento effectively, it is important to use Par levels for stock management and replenishment. Par levels are the minimum quantities of each product in your Magento stock management. Setting these levels ensures you stay within less popular ones. Using Par levels helps you streamline your inventory management process.

It lets you easily identify when to reorder products based on their current stock levels. In this case, you compare to the set minimum threshold. It prevents stockouts in multiple warehouses and delays in fulfilling customer orders.

You can improve order fulfillment rates and increase customer satisfaction by maintaining optimal inventory levels through replenishment.

Additionally, it helps free up financial resources by minimizing excess inventory holding costs.

4. Conduct ABC Analysis for efficient stock management

Conducting ABC analysis to prioritize and manage Magento 2 stock levels effectively

For effective stock management in Magento, performing an ABC Analysis is valuable. This analysis lets you prioritize your inventory according to its value and significance. It also aids in making informed decisions about stock handling and allocation, ensuring optimal management of your resources.

Here's how to do it:

  1. Categorize your products into three groups:

    • Group A: High-value items with high sales volumes.
    • Group B: Moderately valuable items with moderate sales volumes.
    • Group C: Low-value items with low sales volumes.
  2. Calculate the percentage of total sales that each group contributes.

  3. Focus on managing Group A products more closely since they generate the most revenue.

  4. Evaluate your inventory turnover rate for each group:

    • Group A should have a higher turnover rate.
    • Group B will have a moderate turnover rate.
    • Group C may have a slower turnover rate, so be cautious about overstocking.
  5. Use this analysis to set optimal inventory levels for each group:

    • Maintain higher stock levels for Group A products to avoid running out of the stock options.
    • Keep moderate stock levels for Group B products to meet demand without tying up too much capital.
    • Maintain lower stock levels for Group C products due to their lower value and demand.
  6. Regularly review and update your ABC Analysis, as sales patterns may change.

5. Consider drop shipping

Benefits of considering drop shipping as part of your Magento 2 inventory management strategy

Streamline your inventory management in Magento by utilizing drop shipping With dropshipping, you can keep the products physically out of stock. When a customer orders on your website, you can forward those details to a supplier. The supplier can then ship the product directly.

This eliminates your need to handle and store inventory. It reduces costs and frees up storage space. Dropshipping can be especially beneficial if you start with limited capital or have a wide range of products from different suppliers. The approach allows you to expand your product selection without needing upfront inventory investment. Plus, it simplifies order fulfillment as the supplier handles packaging and shipping.

6. Utilize demand forecasting tools

Utilizing demand forecasting tools to manage your inventory in Magento effectively is important. These tools use historical data and sales patterns to predict future demand for your products.

By understanding the demand trends, you can make informed decisions about stock levels and prevent overstock or out-of-stock situations. Demand forecasting tools provide valuable insights that enable you to streamline operations. So, use these tools to make smarter inventory management decisions and keep your customers happy.


1. What are the Magento inventory management features?

Magento inventory management is a sales channel system that tracks and manages stock inventory. It follows multiple sources like warehouses, physical locations, or distribution centers.

2. How can I display product availability on my storefront?

You can display product availability in stock on the storefront through your admin panel settings. You can also set the item in stock status to show "only x left threshold."

3. Can Magento's advanced inventory settings share a common stock source across multiple stores and sales channels?

Magento's advanced inventory data settings allow for an aggregated quantities system. Here, you can share available stock across sales channels and sources.

4. How does Magento help decrease shipping costs?

You can empower businesses to track stock levels across different physical locations. It helps decide the best shipping routes and reduces shipping costs. You can also make Stock adjustments based on the inventory data received.

5. How can I efficiently update inventory levels in Magento's inventory management system?

Updating inventory is easy with Magento's advanced inventory settings and management. You can make bulk updates through the admin panel or import/export functionalities. The update will keep your stock levels accurate and up-to-date.

6. How do Magento's inventory management features handle stock options and product stock options across various sources?

Magento's advanced inventory management system allows you to easily set the quantity for product stock options across multiple locations, including warehouses, brick-and-mortar stores, and distribution centers. This integrated approach ensures accurate tracking and seamless stock fulfillment across various sources.

7. Can I automatically return credit memo items to stock in Magento's inventory data?

Magento's advanced source inventory tracking and management system can automatically be configured to return credit memo items to the available stock. This ensures that your stock levels reflect real-time changes in returns.


The Magento inventory management system is vital for successful Magento 2 stores, creating a smooth foundation for operations and enhancing customer experiences. We covered the top 10 inventory management extensions and gained insights into various strategies.

Ready to optimize your Magento inventory? Discover Magento hosting plans for optimal performance and meet customer demands while enhancing profits!

Maria A.
Maria A.
Technical Writer

Maria has over five years of expertise in content marketing, specialising in Magento insights and industry trends. She excels in creating engaging content that resonates within the Magento community.

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