The good news is that you don’t need complex forecasting software to know when it’s time to reorder. A few key numbers — and the discipline to review them regularly — can help you avoid costly stockouts and unnecessary overstock.
Here’s a practical framework you can start using today.
Step 01Know your average daily sales
The first number you need is your current sales velocity. The formula is simple:
Average daily sales = units sold ÷ number of days
Example. Units sold in the last 30 days: 1,200. Days: 30.
- 40/day1,200 ÷ 30
If your sales are growing quickly, don’t rely on a 90-day average. Use the most recent 30 days — or even the last two weeks — to better reflect current demand.
Step 02Calculate your total lead time
Many sellers only consider manufacturing time. Instead, add every stage of the process.
| Stage | Days |
|---|---|
| Manufacturing | 20 |
| Supplier preparation | 5 |
| Ocean freight | 28 |
| Customs | 7 |
| Inland transport | 3 |
| Amazon receiving | 6 |
| Total lead time | 69 |
This is the number that matters — not just what your supplier tells you.
Step 03Calculate your reorder point
Now combine those two numbers.
Reorder point = average daily sales × lead time + safety stock
- 40Daily sales
- 69Lead time (days)
- 400Safety stock
- 3,160Reorder point
When your available inventory falls to 3,160 units, it’s time to place your next order.
Step 04Estimate safety stock
A simple starting point is to keep enough inventory to cover unexpected delays.
Safety stock = average daily sales × extra days of protection
If you want protection for an additional 10 days: 40 × 10 = 400 units.
If your supply chain is highly unpredictable, you may need 20–30 days of protection instead of 10.
Five metrics you should check every week
Forecasting isn’t just about formulas. It’s also about spotting warning signs early.
1Days of supply
Ask yourself: “If I sold at my current pace, how many days would my inventory last?”
Days of supply = available inventory ÷ average daily sales
- 2,000Inventory
- 40/daySales
- 50 daysDays of supply
If your lead time is 69 days and you have 50 days of supply, you’re already in trouble.
2Inventory trend
Don’t just look at today’s inventory — compare it week by week. If your days of supply has been 90, then 80, then 70, then 60, then 50…
You’re approaching your reorder point much faster than you might realise.
3Sales velocity
Has your daily sales rate changed? Compare the last 7 days against the last 30.
If you’re selling 25% faster than your monthly average, your forecast probably needs updating.
4Inbound inventory
Inventory on the water isn’t inventory you can sell. Always separate available inventory, reserved inventory and inbound inventory.
Many sellers assume inbound units will arrive exactly when planned. Amazon often has other ideas.
5Weeks of cover after your shipment arrives
Before placing an order, ask: “When my shipment finally reaches Amazon, how many weeks of inventory will I have?”
Ordering too much is almost as expensive as ordering too little.
Three warning signs you should never ignore
Your sales are increasing faster than your inventory
Demand is accelerating. Your reorder calculations may already be outdated.
Your supplier keeps missing deadlines
If production regularly slips by two weeks, stop using optimistic lead times in your calculations. Forecast reality — not promises.
You’re relying on memory instead of numbers
If you’re asking yourself “I think we still have enough inventory…”, it’s time to calculate — not guess.
A simple weekly inventory routine
Every Monday morning, spend ten minutes answering these questions:
- What is my current average daily sales?
- How many days of inventory do I have left?
- Has demand increased?
- Has my lead time changed?
- Do I need to place a purchase order this week?
- If demand suddenly increased by 20%, would I still avoid a stockout?
Those six questions alone can prevent many of the inventory emergencies Amazon sellers face.
Final thoughts
Inventory forecasting doesn’t have to be complicated. You don’t need advanced algorithms to make better decisions. You need reliable data, realistic assumptions and a consistent review process.
The sellers who avoid costly stockouts aren’t always the ones with the most sophisticated spreadsheets. More often, they’re the ones who ask the right questions before inventory becomes a problem.
When it comes to inventory planning, being one week early is almost always better than being one day late.