Inventory how-to

How to decide how much to reorder each month

Base your monthly order quantity on recent daily sales, lead time, and how many days of cover you want to hold, minus what you already have on hand or on order.

Short answer: Base your monthly order quantity on recent daily sales, lead time, and how many days of cover you want to hold, minus what you already have on hand or on order. Do this per variant, not per product, since sizes and colors sell at different rates.

Start with daily sales, not gut feel

Look at sales for each variant over the last 28 days and divide by 28 to get a daily sales rate. Use a longer window if the item is seasonal or slow moving, since a short window can be thrown off by one big order or a stockout.

Work out what you actually need

Order quantity = daily sales x (lead time + days of cover) minus (stock on hand + stock on order). Lead time is how long the supplier takes to deliver. Days of cover is how many extra days of stock you want beyond that, as a buffer against demand spikes or late shipments.

Adjust for case packs and minimums

Suppliers often sell in case packs or require a minimum order quantity. Round your calculated quantity up to the nearest case pack or minimum, even if that means carrying a bit more stock than the formula says.

Check this per SKU, every month

Do this exercise for each variant separately. A product with ten variants can have ten different reorder points and ten different order quantities. Bulk ordering "enough of everything" usually means overstocking slow sellers and running out of fast ones.

Step by step

  1. List each variant and pull its sales for the last 28 days.
  2. Divide by 28 to get daily sales per variant.
  3. Note the supplier lead time and your chosen safety days for that SKU.
  4. Calculate order quantity: daily sales x (lead time + days of cover) - (on hand + on order).
  5. Round the result up to the nearest case pack or supplier minimum.
  6. Repeat for every variant before you send the order, not just the bestsellers.
  7. Recheck the numbers each month since sales rates shift.

Worked example

Say a candle variant sold 56 units in the last 28 days, so daily sales is 2 units. Lead time is 10 days and you want 14 days of cover, so you need stock for 24 days: 2 x 24 = 48 units. You currently have 10 on hand and 0 on order, so you need 48 - 10 = 38 units. The supplier sells in case packs of 12, so you round up to 48 units ordered.

How SteadyShelf helps

SteadyShelf runs this exact calculation per variant automatically, using your sales history and each supplier's lead time and safety days, then rounds to case packs and minimums for you. It forecasts per SKU across your whole store, not per location, so if you stock multiple warehouses you still need to split quantities between them yourself.

$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.

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FAQ

What if a product is too new to have 28 days of sales history?

Use whatever sales data you have, even if it is just a week or two, and treat the daily sales number as rough. Lean toward a smaller order with a shorter days of cover until you have more history to trust.

Should I order the same amount every month regardless of season?

No. Daily sales rates change with seasonality, so recalculate each month using recent data. Once you have about 13 months of sales history, seasonal patterns become visible and should be factored into the forecast.

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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