What Is MRO Inventory Control and Can It Help Shopify Businesses?
By using MRO inventory control, Shopify businesses can ensure they have the right inventory on hand when needed.
Updated February 16, 2024.
Running an e-commerce business on Shopify comes with no shortage of moving parts. From acquiring products and managing inventory optimally to order fulfillment and shipping, optimizing your operations is critical to success.
One overlooked area that can significantly impact your bottom line is controlling your MRO inventory: the supplies, parts, and materials needed to keep business running smoothly day-to-day.
Meet the Expert
Sandra Stepan, a seasoned digital marketing and eCommerce expert, is the founder of SnapAdvantage. Her diverse portfolio includes collaborations with startups and companies with $20 million in annual recurring revenue (ARR), solidifying her as a leading resource for brands seeking growth and revenue optimization.
Understanding the Basics of MRO Inventory
MRO stands for maintenance, repair, and operations—it encompasses all the products, parts, and materials important for the ongoing functioning of a business.
MRO items include:
- Spare parts like screws, motors, valves, and fuses needed for equipment maintenance and quick repairs.
- Tools, hardware, and shop supplies like wrenches, nuts, and bolts for facilities upkeep.
- Cleaning materials, protective gear, and lubricants for general maintenance and safety.
- Packaging materials, including tape, bubble wrap, labels, and boxes for fulfillment.
- Office supplies like printer ink, paper, pens, and stationery.
Anything needed to keep e-commerce operations running efficiently behind the scenes falls under the umbrella of MRO inventory. Unlike the main sales inventory, MRO items are not directly sold to customers, but they support core business processes and enable teams to function productively.
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Key Challenges to Managing MRO Inventory
Achieving Ideal Stock Levels
Insufficient MRO inventory can cause workflow disruptions and emergency purchases, while overstocking can lead to capital inefficiencies. Determining the right inventory level to avoid both extremes can be challenging.
Limited Visibility of Item Usage
Another major challenge is limited visibility into the usage of MRO items, making it difficult to forecast demand accurately. Data silos can further make the integration of operational analytics difficult.
Availability of MRO Items
Sudden equipment failure, spikes in seasonal order volume, and warehouse expansions can all lead to unexpected demand surges for certain MRO items. Incorporating such variability into plans can be difficult.
Finally, the process of sourcing MRO supplies during stockouts heavily relies on the strength of supplier relationships and the resilience of the supply chain. Unfortunately, this dependency on external factors can hinder inventory planning efforts.
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4 Ways MRO Inventory Control Helps Shopify Businesses
1. Minimizing Equipment Downtime
Maintenance of spare parts, tools, and shop supplies in inventory means operations will not grind to a halt for minor equipment issues. This means that teams can quickly troubleshoot and fix problems without delays in sourcing replacement components.
2. Generating Significant Cost Savings
Closely monitoring MRO inventory usage and optimizing stock levels reduces unnecessary purchases, overstocking, and expensive rush orders. This results in major cost savings and conserved working capital.
3. Supporting Customer Service Levels
Proper planning and availability of MRO inventory directly ensures uninterrupted internal operations. This, in turn, enables your team to meet production targets and service levels, which ultimately boosts customer satisfaction.
4. Enhancing Operational Productivity
The steady availability of MRO items like packaging materials, protective gear, and office supplies ensures staff can fulfill orders and manage warehouses smoothly without impediments. This translates into higher productivity and leads to increased profits.
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Best Practices for Integrating MRO Management With Shopify
1. Centralize Inventory Management
Use Shopify's unified inventory management system to track your MRO and regular sales inventory. This consolidation enables real-time visibility and easier tracking and control of your MRO stock levels.
Using Shopify apps like Out-of-Stock Police, you can receive alerts and notifications when inventory is low, ensuring timely reordering of critical MRO supplies before they run out of stock and helping you manage out-of-stock items effectively.
- Receive low-stock and out-of-stock notifications to your email or in-app
- Export and download low-stock and out-of-stock products for re-stock planning
- 24/7 support
2. Implement Data-Driven MRO Forecasting
Implement data-driven MRO forecasting by analyzing historical data. Review past maintenance schedules, repair frequencies, and usage rates of MRO items.
Use Shopify's analytics and reporting tools to gather data on inventory trends and usage patterns, facilitating more accurate forecasting of MRO requirements.
3. Streamline MRO Reordering Processes
Establish efficient processes for replenishing MRO inventory as it is consumed. Incorporate automated reordering for frequently used supplies by integrating suitable Shopify apps.
These apps can automate inventory management in various ways, such as generating purchase orders based on pre-defined minimum inventory thresholds to ensure just-in-time fulfillment and avoid shortages.
4. Manage MRO Vendor Relationships
Maintain strong relationships with MRO vendors by managing contacts and order histories systematically. Use Shopify's platform to create and maintain a vendor database, integrating it with your CRM app.
This integration assists in tracking interactions with various MRO suppliers, promoting reliability in the supply chain.
5. Regularly Review MRO Reports
Routinely review MRO inventory reports within Shopify to identify usage patterns, production bottlenecks, and upcoming maintenance needs. Use the insights to optimize safety stock levels, adjust reorder points, avoid obsolete inventory, and make data-backed MRO inventory decisions.
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The Future of MRO Inventory in E-commerce
New approaches are needed to manage the indirect supplies that support the complex online retail operations. Incorporating advanced technologies such as AI and predictive maintenance can forecast MRO requirements well in advance, enabling proactive planning.
MRO management systems must be adaptive and resilient to disruptions, and building agility and flexibility is crucial for smooth operations in the face of changing market conditions. Therefore, e-commerce leaders should be willing to invest in pilots of emerging MRO technologies even if the benefits are not immediate.
