Demand by SKU and location, in consistent units; Usable stock, commitments and dated inbound receipts; Actual lead time, MOQ, packaging and service target

Practical supply planning guide · Inventory

Reduce stockouts without increasing every SKU

A practical planning guide with an illustrative calculation, operating checks and a path from recommendation to approval.

Short answer

Locate the cause of each shortage before changing stock policy: forecast bias, late suppliers, inaccurate inventory and misplaced stock need different actions.

First scope

Start with one SKU and location, then validate the policy on a representative product group.

When to review

Recalculate at each planning review and whenever lead time, demand or confirmed receipts change.

Typical buyer

Supply chain, demand planning, procurement and inventory teams.

Calculation and decisions, step by step

Measure actual lost demand

Sales during a stockout understate demand. Record unfilled orders, substitutions and days without stock. Compare service by SKU and location.

Owner: Planning and procurement
Output: Documented calculation and approved decision

Separate the causes

Check forecast bias, actual versus promised lead time, inventory accuracy and receipts. A late receipt is not automatically a forecasting failure.

Owner: Planning and procurement
Output: Documented calculation and approved decision

Fix the policy with an example

Illustrative example: at 10 units/day, a supplier lead time rising from 10 to 15 days adds 50 units of exposure. Updating the lead-time component of the reorder point addresses that exposure; safety stock must separately reflect uncertainty and the chosen service target. Do not add 50 units to unrelated SKUs.

Owner: Planning and procurement
Output: Documented calculation and approved decision

Review service and capital together

Compare fill rate, stockout days, inventory value and excess stock over a comparable period. Track promotions and seasonality so improvements are not attributed to the wrong cause.

Owner: Planning and procurement
Output: Documented calculation and approved decision

Readiness checklist

Demand by SKU and location, in consistent units
Usable stock, commitments and dated inbound receipts
Actual lead time, MOQ, packaging and service target

Common mistakes

Treating sales during stockouts as complete demand
Counting customer orders twice
Using an average lead time without checking variability

Questions to ask vendors

Can I review inputs and edit a recommendation before approval?
How are purchases and transfers returned to my ERP?

Success metrics

Fill rate: units fulfilled / units requested
Stockout days by SKU and location
Inventory value and excess inventory
Recommendation-to-approval time

Where SOBERAN fits

SOBERAN connects demand, inventory, purchasing constraints and human approvals. Review a real SKU-and-location workflow in a demo to confirm data and ERP integration scope.

Talk to SOBERAN