Inventory how-to
How much safety stock should a small store keep
Keep enough safety stock to cover the gap between your supplier's worst realistic delay and their normal lead time, measured in days of sales.
Short answer: Keep enough safety stock to cover the gap between your supplier's worst realistic delay and their normal lead time, measured in days of sales. For most small stores this works out to a few days to a couple of weeks per SKU, depending on how unreliable the supplier is and how much it costs you to run out.
Why safety stock exists
Lead times are rarely exact. A supplier that normally ships in 10 days might take 14 days during a busy month. Safety stock is the buffer that covers that extra time without you running out of stock.
What drives the number
Three things matter: how variable your supplier's lead time is, how variable your daily sales are, and how bad a stockout would be for that product. A fast-moving SKU with an unreliable supplier needs more safety days than a slow mover with a supplier that always ships on time.
A simple way to set it per SKU
Rather than one safety stock number for the whole store, set safety days per supplier or per SKU. Start with the difference between the supplier's worst-case and typical lead time. If a supplier usually ships in 7 days but has taken up to 12 days before, use 5 safety days as a starting point. Adjust up for your bestsellers and down for items where a stockout barely matters.
Review and adjust over time
Treat the safety days as a working guess, not a fixed rule. If you keep running out before the next delivery, add a few days. If you keep carrying leftover stock long after reordering, cut it back.
Step by step
- List your suppliers and note their typical and worst-case lead times.
- Set a safety day count per supplier based on that gap, not one number for everything.
- Increase safety days for your top sellers and for anything with a long or unreliable lead time.
- Reduce safety days for slow movers or items that are easy to reorder quickly.
- Recalculate reorder points as daily sales times (lead time plus safety days).
- Check actual stockouts and leftover stock each month and adjust the safety days accordingly.
Worked example
A store sells a candle at 4 units a day on average. The supplier's lead time is normally 10 days but has stretched to 15 days before, so the store sets safety days at 5. Reorder point = 4 x (10 + 5) = 60 units. When stock on hand drops to 60 units, it is time to reorder, which gives enough cover even if this shipment runs late.
How SteadyShelf helps
SteadyShelf lets you set safety days per supplier and uses them automatically to calculate each SKU's order-by date and reorder point from your 28-day sales average. It will not tell you what the right safety day number is for a specific supplier, that judgment call based on lead time reliability is still yours.
$29/month flat, unlimited products and suppliers, 30-day free trial. Run the numbers now with the free reorder point calculator.
SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.
Related guides
- How often should you count inventory
- How often should you reorder inventory
- How to account for growth in your forecast
- How much inventory should you keep on hand
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FAQ
Should safety stock be the same for every product?
No. Set it per SKU or per supplier. Bestsellers and items from unreliable suppliers need more safety days, slow movers need less.
What happens if I set safety stock too high?
You tie up cash in stock that sits longer than needed and raise the risk of excess inventory. Review the safety days periodically and bring them down if you are consistently overstocked.
Let SteadyShelf do this math for every SKU
Order-by dates per supplier, seasonal forecasts and draft POs for your Shopify store. $29/month after a 30-day free trial.
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