Why businesses need to focus more on stock optimization

Inventory – be it products to sell or equipment to use to provide customers with a service – is at the core of any business. Without a strong focus on inventory control, the day-to-day running of a business can become pretty difficult.

There are several ways to control and optimize inventory to keep up with demand while also reducing waste for your business and improving the bottom line.

So, if you’re not currently practicing inventory optimization, we’re here to share a few reasons why you need to get started.

Inventory optimization: A brief description

In order to achieve the best business outcomes at the minimum cost, you need inventory optimization.

This process ensures you have the right amount of stock of each product so that your business doesn’t suffer from shortages in peak periods – as this can have a significant impact on your reputation. It’s a common occurrence that businesses over, or underestimate how much stock they need, which is why optimization practices are put in place to reduce the risk.

The optimization process will look at the demand for each product, the value, and the lifecycle. With all of this information, you can then create a better warehouse layout as well as improve purchasing practices.

The benefits of stock optimization

The benefits of this optimization should be pretty straightforward; however, we’ve highlighted a few below.

The first is that losses are reduced. When you only stock the right amount of each product, rather than over or undersupplying, your business won’t miss out on sales and won’t be sat on deadstock they can’t shift. This reduced waste of inventory means you’ll have more money and space to experiment with new products and services.

The second benefit is the increase in control and accuracy of your stock management. With the optimum inventory and record of such, you’ll be able to create accurate demand forecasts for the new year and monitor sales throughout.

Another benefit to stock optimization is productivity. Paired with an efficient warehouse layout, optimization can ensure staff don’t have to waste time searching for items in storage. They’ll know exactly where to look for each product and, as such, cut picking times dramatically. All of this means productivity can be improved, and your customers can receive their orders faster.

While the process can be done manually, incorporating automation can reduce the chance of human error and inefficiencies in the warehouse. Technology will be able to keep up with peak sales periods much better, as staff will likely be swept off their feet with picking and packing. By using a robust stock management system, you can ensure that stock levels are always at the optimum level and if there’s a shortage, more is already on the way.


The key to inventory optimization is to ensure there’s the right amount of stock in the right place at the right time. By taking on detailed analysis and creating demand forecasts, your business can work to improve stock replenishment processes, reduce waste and save space.


Dee is a well-respected business journalist with a deep understanding of global financial markets and a talent for uncovering the stories behind the numbers. With over 20 years of experience covering the business beat, Dee is known for his in-depth reporting and analysis of industry trends, as well as his ability to make complex financial concepts understandable to a wide audience.