Serialized inventory trackingInventory management is one of the most important aspects of retail business, and inventory tracking is one part of it that must be done effectively to avoid problems. When it’s not done accurately, it can lead to poor inventory control, overselling, unhappy customers, and worst of all, seller account deactivation.

There are various inventory control methods that can be used by ecommerce retailers. One method, and the focus of this post, is serialized inventory tracking.


What Is Serialized Inventory Tracking?

Putting it simply, serialized inventory is the tracking of individual units using unique serial numbers. It’s different than using SKU numbers, in that SKU numbers identify a type of product while serial numbers identify one specific item.

For example, if you sell clothing, you might assign a SKU number to identify a women’s red shirt in size medium. That means that every one of those shirts will have the same SKU number. Learn more about SKUs and the principles of inventory management here.

Conversely, a unique serial number is assigned to every single product, even when you have many units of that product. Smartphones are a good example of using serial numbers. Each individual phone has an IMEI number that is specific to that phone, and each phone will be owned by a specific individual.


Why is Serialized Inventory Important?

There are numerous reasons why serialized inventory is important and why ecommerce sellers should care about it. Some of those reasons are:

  • Product ownership – Serialized inventory can assist product owners when there is a theft, repair needed, or in some cases of troubleshooting. For example, firearms have serial numbers that are useful to authorities in determining product ownership.
  • Guarantees and warranties – Guarantees and warranties always have a specific amount of time they are valid. Because products are sold at different times, they will have different start and end times for guarantees and warranties. Serialization allows retailers to properly identify whether products are still under warranty to easily manage the process of repair or replacement.
  • Product recalls – Notifying product owners when there is a product recall is also a valuable use of inventory serialization. You’re probably familiar with product recalls associated with defective components in cars. Every car has a Vehicle Identification Number (VIN), which is a form of serial number, that allows the owners to be tracked. Because ownership is easily determined, owners of defective products can be notified to have the product repaired or replaced.
  • Quality control – Quality control is an important aspect of the manufacturing process that must be monitored. When there are irregularities in products that have been manufactured, serial numbers make it easier for quality control personnel to track the defective pieces.


Are There Situations in Which Serialization Inventory Shouldn’t Be Used?

Deciding whether you should use serial numbers to track your products should be done on a case-by-case basis. Assigning serial numbers is suitable for some products, while it may be an unnecessary task for others.

Typically, products that are more valuable use serialization, as well as products that are regulated by government agencies or other overseeing organizations. Some of the products for which serialization is standard include firearms, jewelry, smartphones, laptops, and other electronics. If you sell any of these products, then you will need an inventory management solution that allows for serial number tracking.

For products that are not high-value or regulated, you may still decide to use serialization to make some processes easier. Serialization makes tracking individual purchases for warranty claims easy and manufacturer recalls depend on serial numbers to specify which products may be defective.

There are some products for which serialization isn’t needed at all and would be a time-consuming task that just isn’t worth it. If you sell homogenous products that are inexpensive, serialization isn’t effective. There just isn’t a need to identify each and every unit of inventory. If the product doesn’t have any underlying liability regarding its usage, then it’s also unnecessary to use serial numbers as it isn’t likely that determining ownership will ever be required.


Final Thoughts

Using serialized inventory tracking is not necessary for a lot of ecommerce sellers. But if you sell valuable products or regulated items, it can be extremely beneficial because ownership is easily identifiable. Do you have any experience with serialized inventory tracking? Let us know in the comments!

If you need help managing serialized inventory, give us a try. We have everything you need to manage inventory, sales orders, and more. Take a product tour to see all our features.


The Ultimate Guide To Inventory Management for Multichannel Retailers
The Ultimate Guide To Inventory Management for Multichannel Retailers

The ins and outs of managing inventory are overwhelming. That’s why we’ve put together the only guide that covers inventory management basics, accounting methods, pricing strategies, multichannel marketing strategies, and more.

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