Stock Replenishment

Arguably, the most important aspect of inventory management is stock replenishment. This refers to the process of ordering, allocating, and transporting inventory to the location where it’s either stored or sold. 

Stock replenishment ensures there are no gaps between fulfillment orders, avoiding the loss of profit that occurs when an item is out of stock. It also prevents over-ordering and crowding markdowns. 

When performed correctly, it can help your business increase profits, maximize efficiency, and improve customer satisfaction. Read on to discover everything you need to know about stock replenishment!

What Is Stock Replenishment?

To be more specific, stock replenishment is the process of moving products down the supply chain. It starts with an order from headquarters, which triggers the manufacturers to create the product and transport it to the designated vendors. 

The right replenishment strategy allocates the most optimal amount of products to the right vendor locations. For example, if one store does not bring in many sales, it will receive less product than a more profitable location. 

In addition to customer demand, there are many other things to consider when creating a stock replenishment plan. This includes manufacturing and processing time, the shelf life of the product, and the potential for supply chain disruptions. 

Tips for Efficient Stock Replenishment

Finding the right stock replenishment strategy for your business requires a careful consideration of the sales data, as well as a bit of trial and error. Here are a few tips for developing an efficient stock replenishment system:


  • Determine Accurate Lead Times: This is the total time it takes for the order to be fulfilled. Keep data of this process and evaluate your suppliers regularly to ensure they are consistently performing on time. 
  • Calculate the Reorder Point: This refers to an established indicator that it is time for the next order to be placed. The reorder point is calculated by predicting how many products can be sold within the lead time. 
  • Remember Safety Stock: Don’t forget to include a little extra stock as precaution. This prevents shortages in case of supply chain disruption, and also accounts for potentially low sales predictions.
  • Use the Right Software:  Back in the day, stock replenishment was performed with paper and pencil. Today, you can use inventory management software to save time and minimize the chance of human error. 
  • Hire a 3PL Provider: If you are struggling to manage your inventory levels, you may benefit from a third party logistics provider, or a 3PL. Their services can help you with a variety of your fulfillment needs. 


East Coast Inventory Management Services

Are you looking to outsource your warehouse and inventory management? Do you need reliable fulfillment and distribution services on the East Coast? If you answered “yes” to these questions, you need Cannon Hill Logistics!

We are a 3PL company with over 30 years of experience streaming the distribution process. Let us help your small business expand. Call Cannon Hill Logistics today to learn more about our inventory management services!