Inventory planning determines how much stock a business should order, where it should be held and when it should be replenished. The plan connects expected demand with supplier lead time, minimum orders, service targets and available cash.
Use assumptions the team can inspect
Record the demand period, forecast source, current stock, open purchase orders, safety stock, supplier lead time and review frequency. Separate confirmed demand from promotional or growth assumptions.
| Area | What to establish |
|---|---|
| Demand | Baseline sales, seasonality and planned promotions |
| Supply | Lead time, minimum order, capacity and reliability |
| Stock | On hand, reserved, inbound and unavailable units |
| Cash and space | Purchase timing, storage limit and working-capital constraint |
The cost of being wrong
Excess inventory ties up cash and may become obsolete. Too little inventory causes missed sales, urgent freight and unstable supplier orders. The chosen service target should make that tradeoff explicit.
Related terms
economic order quantity, minimum order quantity, production lead time, ecommerce fulfilment.
