Stock replenishment tips for Shopify store managers

in shopify, stock replenishment, inventory planning

Does your Shopify store carry a large amounts of inventory? As a product or logistic manager you want to avoid the situation when you order too many products and thus freeze lot of money in stock. On the other hand, you want to avoid the opposite situation when you order too little stock and thus experience stock outs and the need to fill back orders.

The ability to optimally replenish stock levels and plan inventory is unquestionably a very demanding skill, which is necessary to keep your profits in balance. This is especially true when you are growing market share, sales, gross profit and customer base.

3 goals of stock replenishment

From the users of FutureMargin price optimization software we learned that one of the main business needs of successful retail operation is to find out the best possible replenishment techniques. In this article we summarized four tips for improving stock replenishment process for retailers, specifically for those operating large product quantities.

The more products you hold in your product portfolio, the more crucial it is to order and refill stocks in appropriate amounts and on time.

Whether you compete on the global market or locally, you need to have an effective supply chain management practices in place.

Supply chain management can be easily viewed as a synchronization between supply (your stock inventory) and demand (your customer orders). Your task is planning, organizing, executing and controlling all supply chain activities with the objective to be more competitive and profitable. Your stock replenishment process should try to balance and achieve three main goals:

A. Avoid stock outs

When customers of your Shopify store see a long delivery time listed with product offering, it will most probably imply lower conversions. Nobody wants to wait too long for their purchase, especially when customers are looking forward to receiving and using the products. By not having enough item quantities in short-term you risk that the sales will drop down, and in the long run you might be in danger of losing long-term customer retention.

B. Avoid over stocked items

The opposite challenge happens when you stock your inventory with unnecessary quantities of products. The first threat here is that a big part of company's money will be temporarily tight up in the stock. You risk having products sitting on shelves, incurring yet further costs required for storage space management and most importantly, with increasing product age risk having to eventually short the obsolete products using steep discounts.

C. Replenish quickly

When optimizing inventory by computing product quantities manually, the time required for product replenishment can quickly grow. This is especially true if you have thousands or tens of thousands of products. By saving manual computations and using a suitable demand forecasting mechanisms, you gain more time available for other supply chain operations.

4 tips for optimal stock replenishment in your Shopify store

1. ABC analysis

Divide your inventory into three categories (A, B, C) and identify items that will have a significant impact on overall inventory cost (Source: Manufacturing planning and control systems for supply chain management By Thomas E. Vollmann. Also: Wikipedia ABC analysis article). 20% of products in any type of portfolio are usually “A” items. They are the most important ones you offer, so pinpoint, focus and analyze their stock dynamics and implement suitable semi-automatic replenishment process. It's undoubtedly worth it, because these items likely influence a large proportion of your revenues.

2. Use FutureMargin demand forecasting software

Implement a sale forecasting software, which automatically forecasts expected SKU demand quantities every day, so the only thing your purchase manager needs to do is to monitor your individual stock levels and reorder recommended product quantities as needed. The advantage of a smart demand forecasting software is that various important factors such as seasonality are automatically included in predictions. Forecasts are generated automatically via computer statistics and not manually. This solution saves a lot of time otherwise required to compute the statistics by hand.

3. Include information about special promotions

Don't forget that your inventory planning needs to count with special promotions. Automatic demand forecasting software generally can't see and automatically incorporate future one-off promotions, discounts or giveaways, therefore involve such special know-how about upcoming events manually and adjust your purchase orders accordingly.

4. Watch out for external and seasonal events

The best example of a special external event is Christmas. Identify most popular products which you expect to sell well and which have steady sale dynamics. Keep an eye on their stock levels before and during the external event period, so you don't miss out on any sales opportunities.


Stock replenishment is a critical task for your Shopify store operation. Three most important goals that you want to achieve with inventory planning are avoiding stock outs, decreasing over-stocked items and finally shortening time during required for manual purchase order generation. ABC analysis and usage of a specialised stock planning software can bring great benefits, especially for stores that operate thousands SKUs.

About FutureMargin

FutureMargin is machine intelligence tool for ecommerce stores. Using historical sale, visitor and margin data, FutureMargin can be used to improve your e-shop product pricing and profit and improve inventory levels. Available integrations: Shopify and API.