Inventory how-to

How to plan inventory for overseas manufacturing

Plan around your true total lead time: production time plus shipping time plus customs clearance, not just the sailing time.

Short answer: Plan around your true total lead time: production time plus shipping time plus customs clearance, not just the sailing time. Add safety days for delays, and place orders early enough that stock on hand covers you until the new batch clears customs and reaches your warehouse.

Work out your real lead time

Overseas manufacturing lead time is not one number. It is production time (from PO to goods ready), transit time (factory to port, sailing or flying, port to your warehouse), and customs or inspection time. Add these together and you get your true lead time. Track this per supplier, since a factory in one country can have a very different total than one elsewhere.

Build in safety days for the parts you cannot control

Shipping delays, customs holds, and factory slippage are common with overseas orders. Add safety days on top of your true lead time to cover this. The further the supplier and the more steps in transit, the more safety days you need. Review actual arrival dates against planned dates every few months and adjust.

Order earlier than feels natural

Because total lead time is often 60 to 120 days or more, your order-by date will be well before stock looks low. Calculate it from your daily sales rate, not from how full the shelf looks. If you wait until stock feels tight, you will run out before the next shipment arrives.

Account for minimum order quantities and case packs

Overseas factories often set minimum order quantities per SKU or per run. This can mean ordering more than your forecast calls for. When that happens, order the minimum and expect extra days of cover, then adjust your next order-by date to account for the surplus.

Keep a buffer for the unexpected

Even with good planning, one missed vessel or a slow customs week can throw off timing. Keep a bit of extra safety stock on your fastest-selling SKUs, since these are the ones that hurt most if they run out while the next batch is still at sea.

Step by step

  1. List each overseas supplier with production time, transit time, and customs time separately, then add them for true lead time.
  2. Set safety days per supplier based on past delays, not a flat number for all suppliers.
  3. Calculate reorder point as daily sales x (lead time + safety days) for each SKU.
  4. Set order-by dates from reorder points, not from visual stock checks.
  5. Apply each supplier's minimum order quantity and case pack size to your suggested order quantity.
  6. Track actual arrival dates against planned arrival dates and adjust safety days over time.
  7. Keep extra safety stock on your top sellers to absorb shipping or customs delays.

Worked example

A store sells a kitchen gadget at 8 units a day. Production takes 30 days, ocean transit takes 35 days, and customs clearing takes 10 days, so true lead time is 75 days. The supplier wants 20 safety days for delays, giving a reorder point of 8 x (75 + 20) = 760 units. If on hand is 900 units and nothing is on order, the store is not yet at the reorder point and can wait. Once on hand drops to 760 units, it is time to place the next order, sized to cover lead time plus the desired days of extra cover.

How SteadyShelf helps

SteadyShelf can take your supplier's lead time and safety days, including long overseas totals, and give you an order-by date and suggested quantity per SKU, rounded to case packs and minimums. It does not do landed cost or manufacturing or BOM tracking, so you still need to manage production scheduling and total landed cost separately.

$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 lead time should I enter if my overseas supplier only gives me production time?

Add your own estimate for shipping and customs on top of the production time the supplier quotes. Track actual arrivals for a few cycles so you can replace the estimate with a real number.

How many safety days should I use for overseas shipments?

There is no fixed number. Start with a conservative estimate based on past shipments from that supplier, then adjust it up or down once you have a few cycles of actual arrival data to compare against planned dates.

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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