Inventory how-to

How to decide between ordering more often or ordering more each time

Order more often (smaller batches) when cash is tight, demand is hard to predict, or storage space is limited.

Short answer: Order more often (smaller batches) when cash is tight, demand is hard to predict, or storage space is limited. Order larger quantities less often when your supplier has high minimums or case packs, shipping costs are a big share of the order, or lead times are long and unreliable. Most small stores end up somewhere in between, driven mostly by supplier terms rather than preference.

What drives the decision

The main costs to weigh are holding cost and order cost. Holding cost is the money tied up in stock sitting on a shelf, plus the risk it goes stale or out of season. Order cost is the fixed hassle and expense of placing an order: supplier minimums, shipping fees, your own time reviewing and approving. If order cost is high relative to holding cost, order bigger and less often. If holding cost is high relative to order cost, order smaller and more often.

Check your supplier terms first

Before you pick a strategy, look at what your supplier actually allows. A high case pack or minimum order quantity pushes you toward larger, less frequent orders whether you want that or not. A low minimum and fast lead time let you order little and often, which keeps less cash in stock. If a supplier charges a flat shipping fee no matter the order size, that fee is a strong reason to batch orders together.

Watch lead time and safety days

Longer lead times usually mean you need to order earlier and often in bigger batches, since a small top-up order would arrive too late anyway. Short, reliable lead times let you run close to the bone and reorder frequently in small amounts. If your safety days are high because a supplier is unreliable, you are effectively already paying for the "order more often" style in the form of extra stock sitting around as a buffer.

Match it to how fast the SKU sells

Fast movers tolerate frequent small orders fine, since you will use up the stock quickly and the order cost gets spread over a lot of sales. Slow movers are better ordered in whatever quantity meets the minimum, then left alone for a while, since ordering them often just adds admin for little benefit. Don't apply one rule to your whole catalog. Split it by how each SKU actually behaves.

Step by step

  1. List each SKU's supplier minimum, case pack, and lead time in one place.
  2. For each SKU, calculate days of stock: on hand divided by average daily sales.
  3. If days of stock swings low often and the minimum order is small, favor frequent small orders.
  4. If the minimum order or case pack is large, accept fewer, bigger orders and size them to last through the next few lead-time cycles.
  5. For slow sellers, order the minimum quantity and expect it to last a long time. Don't top it up early just because it feels due.
  6. Review this split every few months, since a SKU can shift from fast to slow mover and the right approach changes with it.
  7. If shipping fees are flat per order, check whether combining two SKUs into one order from the same supplier saves more than the extra stock costs to hold.

Worked example

Say a store sells a candle at 4 units a day. The supplier's lead time is 10 days, minimum order is 20 units, and case pack is 10. Reorder point is 4 x (10 + 3 safety days) = 52 units. If the store orders small and often, it would order 20 units roughly every 5 days, just above the minimum, running tight on cash but keeping stock fresh. If it orders big and less often, it might order 80 units (8 case packs) to cover 20 days, tying up more cash but cutting the number of orders from six a month to under two.

How SteadyShelf helps

SteadyShelf already works off each supplier's lead time, safety days, case packs and minimums, so the quantity it suggests naturally leans toward smaller or larger batches based on those supplier terms. It won't model holding cost or cash flow for you directly, so the frequent-vs-bulk tradeoff itself is still a judgment call you make, not something the app decides.

$29/month flat, unlimited products and suppliers, 30-day free trial. Run the numbers now with the free reorder point calculator.

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FAQ

Does ordering more often always mean lower risk?

No. More frequent orders mean more chances for something to go wrong, like a missed order date or a supplier delay, and more admin time spent placing and checking orders. It lowers the amount of cash tied up at any one time, but it is not automatically lower risk overall.

Should I use the same ordering frequency for every supplier?

No. Base it on each supplier's own lead time, minimums and shipping terms. A supplier with a low minimum and fast shipping can be ordered from often in small amounts, while one with a high minimum or slow shipping needs fewer, larger orders regardless of what you do with other suppliers.

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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