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Inventory Availability: Everything You Need to Know in 2024

4 minutes

In this article, we cover what inventory availability is and why it matters for your business. We also provide a simple 8-step framework to help you improve it, with real-world examples. Read on to learn more.

inventory availability

What Is Inventory Availability? 

Inventory availability refers to inventory available on hand that is ready for sale or distribution at any given time. It represents the balance between stock levels and customer demand, ensuring goods are available when needed. 

Example: For instance, Golden Grain Bakery currently has 500 loaves of their popular multigrain bread in stock. However, with an upcoming health and wellness festival in town, they anticipate a surge in demand and project needing 1,200 loaves in the coming week.

inventory available

Why Does Inventory Availability Matter? 

Inventory availability is the backbone of successful retail and manufacturing operations. We list some key reasons for this below: 

Customer Satisfaction: When products are in stock, customers are satisfied as they get what they want promptly. Delays or out-of-stock situations can deter loyal customers.

Financial Health: Proper inventory levels can prevent overstocking costs and lost sales from understocking. Maintaining the right balance aids in financial stability.

Operational Efficiency: With accurate inventory data, businesses can operate smoothly, reducing downtime or delays.

Supply Chain Management: Effective inventory availability enhances supply chain operations, ensuring timely restocking.

Brand Reputation: Companies with consistent product availability are seen as reliable, bolstering their reputation.

Sales Forecasting: Accurate inventory availability helps in predicting future sales and trends, aiding in strategic decision-making.

what is inventory availability

8 Simple Ways to Optimize Inventory Available on Hand

Optimizing inventory availability ensures that businesses meet customer demand without incurring losses from overstocking or missing sales opportunities from stock-outs. 

Here are 8 simple ways you can optimize inventory availability for your business: 

1. Detailed Product Tracking

Implement SKU (Stock Keeping Unit) or barcoding systems for each product. This allows for real-time tracking of each item.

Example: ElegantFootwear Inc. introduced barcoding for each shoe type and size, ensuring that specific sizes and styles are promptly reordered when stock dwindles.

2. Sales Trend Analysis

Analyze sales data daily, weekly, and monthly. Identify products that consistently run out or remain overstocked.

Example: TechTools Ltd. observed that sales of certain cordless drills spiked on weekends. As a result, they increased weekend stock levels by 30%.

3. Supplier Lead Time Assessment

Calculate the time taken from placing an order with a supplier to receiving it. This knowledge aids in timely reordering.

Example: Homely Furnishings found that certain exotic wood types took 8 weeks for delivery. They adjusted their ordering schedule to account for this delay.

4. Demand Forecasting with Advanced Tools

Procedure: Utilize AI-driven analytics tools that predict future demand based on market trends, historical data, and current events.

Example: SportGear Outfitters utilized predictive analytics to anticipate a 40% rise in hiking gear sales based on an upcoming national hiking event.

5. Dynamic Reorder Points

Rather than having a static reorder point for each product, adjust reorder levels based on seasonality, promotions, or known upcoming events.

Example: Seasonal Delights, a confectionery store, shifted reorder points for chocolate products upwards in anticipation of Valentine's Day and Christmas.

6. Safety Stock Calibration

Periodically assess and adjust the safety stock levels to ensure that even in the face of unexpected demand or supply chain hiccups, stock-outs are prevented.

Example: MediCare Supplies adjusted their safety stock levels for flu medications based on early predictions of a tougher flu season.

7. Vendor Managed Inventory (VMI)

Collaborate with suppliers to allow them to monitor your stock levels and take responsibility for restocking when levels are low.

Example: ElectroHub Electronics collaborated with their battery supplier, allowing them to monitor stock and automatically ship replacements before stock-outs occurred.

8. Continuous Training

Regularly train staff on inventory management best practices, tools, and technologies.

Example: Print Pros Ltd. holds bi-monthly training sessions for their staff, ensuring they are updated on the latest inventory management software features and best practices.


Harborside Grocery is a city-based grocery store that has been facing challenges in keeping their produce section stocked, particularly during weekend spikes in customer traffic. They've lost customers due to stock-outs and have incurred waste from overstocking. 

They decided to follow our 8-step approach to optimize inventory availability:

1. Detailed Product Tracking

Harborside Grocery implemented a barcode system for every produce type, distinguishing between organic and non-organic. This allowed them to instantly identify when stocks of specific vegetables or fruits were running low, ensuring prompt reordering.

2. Sales Trend Analysis

After analyzing their sales data, Harborside realized that certain organic veggies and fruits tended to sell out by midday on Saturdays. As a response, they increased the stocks of these items during weekends, ensuring their continued availability to customers.

3. Supplier Lead Time Assessment

Harborside determined that their exotic fruits supplier took three days longer for delivery compared to local suppliers. To counteract this delay, they adjusted their ordering schedule, ensuring those fruits were ordered well in advance.

4. Demand Forecasting with Advanced Tools

By using an AI-powered analytics tool to assess and predict weekend demand based on past sales data, Harborside saw a 20% reduction in overstocked perishables, which significantly reduced waste.

5. Dynamic Reorder Points

Anticipating a spike in demand for certain health foods due to a local fitness event promoting healthy eating, Harborside adjusted their reorder points for items such as chia seeds and avocados, thus preventing potential stock-outs.

6. Safety Stock Calibration

The store decided to add a safety stock of key items, particularly those that had a history of selling out quickly. This decision ensured that even on the busiest days, no customer was left disappointed due to stock-outs.

7. Vendor Managed Inventory (VMI)

Harborside collaborated with their dairy products supplier, enabling them to monitor levels of milk and yogurt in real-time. This partnership meant the supplier could automatically restock items on the brink of running out, ensuring uninterrupted availability.

8. Continuous Training

Prioritizing staff proficiency, Harborside's inventory management team underwent training on the latest software features and the importance of frequent stock checks. This initiative led to a marked reduction in miscounts and data entry errors, further optimizing stock levels.

Thanks to this structured approach, Harborside Grocery saw a marked improvement in their inventory availability, reducing both wastage and customer dissatisfaction.

We hope this article has given you a better understanding of inventory availability and how to improve it for your business.

If you enjoyed this article, you might also like our article on inventory purchase formula or our article on different ways to store inventory. 

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