inventory management

How to easily manage your inventory on Etsy

We show you how to use Etsy to manage your inventory, stock levels and quantities.

Etsy is an incredible place to start your handmade business - it helps you find your first customers and dial in your processes. Those early days, weeks, and months are often a time when we celebrate each sale, but what happens when you start to get a lot of orders?

Well, besides popping the champagne 🥂, it’s time to get your processes down so you can grow without stress. One of the biggest factors that can hinder your growth is not properly tracking your inventory, which can lead to delivery delays, customer trust issues, bad reviews, and ranking drops.

The good news is that you’re here and that means you’re being proactive and are unlikely to experience these issues, especially when you use the top tips we’re about to share with you below on managing and tracking your Etsy inventory.

5 Top Tips for Managing Your Etsy Inventory

Here are our five best tips on how to keep track of your inventory on Etsy.

1. Get an Inventory Tracking System ASAP

If you don’t yet have an inventory tracking system in place beyond what you can see in front of you, now is the time to get that in place. Your inventory tracking system doesn’t have to be sophisticated, but it does have to be accurate. The problem with paper trackers and spreadsheets is that you have to be the one to go in and edit it every time you make a sale. If you’re only making a handful of sales a day, that may not be a problem, but it will be as you scale.

If you are someone who typically struggles to go in and do administrative work like this, then you’re going to need a different solution to keep your business on the right track.

Fortunately, this is one of the reasons we created Craftybase! Craftybase is affordable software that helps you manage your Etsy inventory automatically. Craftybase links directly with your Etsy account so you can see in real-time how much inventory you have and when it’s time to order more materials. To find out more about how Craftybase helps you manage your inventory, click here.

2. Have a Pinterest-able Crafting Workspace

Have you got a Pinterest board full of beautiful crafting rooms and workspaces you’d love to have? Us too. The best things about these rooms are that they’re organized.

While we’re not saying you need to renovate your crafting space right here and now, you do need to have an organized workspace where everything you need has a place so you always know where to find it (and where to put it back).

If you’re an out-of-sight, out-of-mind kind of person, look for clear storage options, make good use of labels, and if you need to have anything out on the desk in front of you, clear rotating storage plates typically used for cakes and spices are a great hack.

For more information about adopting a location naming system, (especially if you’re a fast-growing business), see our blog post here.

Related: Etsy Sellers - How to Use Pinterest to Market and Sell your Handmade Products

3. Use SKUs

You’re a growing business, so it’s time to make use of SKUs. SKUs (“stock keeping unit”) are numbers you can use to keep track of different products and track your inventory.

When you’re giving SKUs to your products, make sure you create different codes for small variations (such as different colors) and be consistent with the codes you give your products.

If you’re not sure what you should be doing here, here’s a quick overview of how to create SKUs:

  • Most SKUs are 5 - 9 digits long, how long you need depends on how many variations of products you have or intend to make.
  • The first 1-3 digits should be your high-level identifier. For example, if you sell skincare products, your high-level identifiers may look something like 01: moisturizer, 02: toner, 03: serum, and so on.
  • Your middle digits should identify unique qualities about it, such as color, size, or type. For example, you may use 111 to show that it is 1 - a moisturizer for dry skin, 1 - fragrance-free, and 1 - 30ml in size.
  • Finish the sequence with another 1-3 digits that make it easy for you to update the model. For example, if you had a moisturizer for dry skin that was fragrance-free and 30ml in size, you may have the SKU 01111001, with the 001 at the end distinguishing that it’s the very first iteration of the product. If you updated something about it in the future, you would want to change the SKU to 01111002 to show that it’s the second iteration.

Make sure your SKUs are integrated with your inventory management system, whether you’re using a spreadsheet in Google Docs or sophisticated software like Craftybase. For more detailed advice on creating SKUs, see our blog post here.

4. Review Your Sales Often

After you’ve been in business for a while, you’ll start to realize that there are a few of your products that are your shining stars. They outsell all your other products and are the core of almost every order you get. These are your bestsellers.

You want to identify your bestselling products not just so you can sell more of them and make sure they’re at the core of your marketing, they should also be the products you are most mindful of keeping in stock. You may have a couple of products you only sell a handful of a month, so letting their stock get relatively low likely won’t cause you any trouble.

The same cannot be said for allowing yourself to have low stock of your best-selling products - if you sell out of these, it will handicap your business and disappoint your customers. Keep track of these bestsellers and use your inventory tracking system to prompt you to order materials and make more whenever their stock gets anywhere near low.

5. Set Low Stock Limits

Building on our last point, you should start setting low stock limits for yourself in your inventory tracking system that prompts you to make more, order more materials, or order more of the product if it’s something you buy wholesale. Review this figure once a quarter to make sure it’s still suitable for the number of orders you receive.

Does Etsy manage inventory?

Etsy’s inventory management tools are a great way to get started - you can set quantities and variations for products, and give their products additional data such as type of material, but that’s really where it bottoms out. It won’t keep track of your materials and you can’t (currently) set low stock alerts so you know it’s time to order more.

What it comes down to is you either need to be willing to be hypervigilant and attentive with your systems to ensure you don’t run into trouble overpromising and under-delivering (easy if you’re busy and forget to check materials and stock levels), or getting the right software to support you.

Craftybase will track your inventory, your materials, alert you when it’s time to order more materials or make more stock, help you mind your pricing, keep track of your bookkeeping, and more. You can start your 14-day free trial card-free to see if it’s the right fit for you - click here to get started.

Hope that this article has given you some ideas on how to keep track of your inventory on Etsy!

Nicole Pascoe Nicole Pascoe - Profile

Written by Nicole Pascoe

Nicole is the co-founder of Craftybase, an inventory and bookkeeping software product designed specifically for handmade sellers. She has been working with, and writing articles for, Etsy sellers for the last 12 years. Her passion is to help handmade sellers to become more successful with their online endeavors by empowering them with the knowledge they need to take their business to the next level.

Want to learn more about handmade inventory management?

It's a fact: inventory tracking improves both your business and your bottom line. Our eBook introduces online craft sellers to the absolute basics of inventory in an easy to understand way, giving you the knowledge you need to finally get your inventory, costs and taxes under control.

Inventory Management for Handmade Sellers eBook cover