Best Practices for Inventory Forecasting and Improving Inventory Turnover ! Make Up Your Mind to Discover Apply Succeed!!
Best Practices for Inventory Forecasting Start by gathering as much data about your sales history as possible. Six months is a good starting place, but a year or two of data can give you better insight into monthly demand. And ensure your data is accurate. Here are some other best practices to consider implementing. Build a team that collaborates in developing the forecast. Use an inventory management program that works well and provides documented processes. Keep a close eye on inventory turnover and whether you meet benchmarks. Use qualitative information to drive forecasting. Use all available historical supply and demand data. Calculate all past margins and profits and future goals, such as gross profit margin. Use the reorder point formula. Carefully measure sales trends so you can be as precise and accurate as possible. Use the lead time to better understand demand. Calculate safety stock. Use software that supports your forecasting needs.