Inventory glossary
What is On hand inventory?
On hand inventory is the quantity of a product that physically exists in your warehouse or store right now, regardless of whether it has been promised to a customer order.
On hand inventory is the starting point for every reorder decision. If you only look at what shows as "available" on your sales channel, you might miss stock that is sitting there but already committed to unfulfilled orders, which leads to confusion about what you actually need to buy.
Small store owners should check on hand inventory against committed inventory to get a true picture. On hand minus committed tells you what is actually free to sell, and that number, not on hand alone, should drive your reorder timing.
Formula
Example
A candle store receives 200 units of a vanilla candle. Over the next month it sells 140 and has 10 units set aside for unfulfilled gift orders. On hand inventory is 60 units, but only 50 units are actually available to sell to new customers.
Common mistakes
- Confusing on hand inventory with available inventory, which ignores committed stock.
- Not updating on hand counts after manual adjustments like damage or samples.
- Relying on system counts without occasional physical checks, letting errors build up over time.
On hand inventory and SteadyShelf
SteadyShelf uses your on hand inventory as the base number when it calculates how much to reorder and when, so accurate on hand counts directly improve its purchase order suggestions.
SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.
Related terms
Committed inventory · Quantity on hand · Available to promise · Perpetual inventory · Inventory accuracy
FAQ
Is on hand inventory the same as available inventory?
No. On hand inventory counts everything physically present, while available inventory subtracts stock already committed to open orders.
How often should I check on hand inventory?
Check it whenever you receive stock, fulfill orders, or make manual adjustments, and do a physical count periodically to catch discrepancies.
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