Operations Advanced 17 min

Inventory and demand planning — how much to order and when

The problem

You reorder when stock 'looks low'. Sometimes you stock out for three weeks and your listing loses its ranking, which takes two months to recover. Other times you have eleven months of a slow SKU sitting in FBA accruing storage fees.

The workflow
1Gather daily demand
2Measure lead time
3Compute variability
4Set service level
5Compute reorder point
6Decide order quantity
7Check cash
Review monthly

What you need

SKU: insulated lunch box. Daily sales for 8 months (uploaded).

The tool

Excel or code mode

The prompt

Subscribers. The full prompt is part of the SMEMinds AI Playbook. See plans.

What comes back

1. DATA ASSESSMENT — Eight months of daily sales is adequate for demand variability but covers only one June–July period, so the seasonal uplift rests on a single observation.

Verify before you use it

Human review required. Check every line below before this leaves your screen.
  • The stockout-day exclusion is important — verify those six zero days were genuinely stockouts and not zero demand. Getting this backwards understates demand and causes the next stockout.
  • Three lead-time observations is genuinely thin. Record every future lead time with dates; the fourth and fifth observations will materially improve this.
  • Check the ranking-recovery estimate of two months against what actually happened after your last stockout. It is the largest input to the asymmetry.
  • Confirm the ₹4 lakh cash figure is what you can commit, not what you have. Inventory is the easiest place to over-commit.