Tel: (01) 901 1310


How Do You Know You Are Carrying To Much Stock?

Share Post:

Share on linkedin
Share on twitter
Share on facebook
Share on email

Ideally you should carry no stock, but that’s not practical, right?

Let’s state some of the glaringly obvious points – stock is just another form of cash. The problem is that it takes time to turn it into cash you can spend. The large players and big hitters that we all know relentlessly drive down the dwell time of stock in their hands so they can turn it as quickly as they can into money. If you are interested management consulting can clarify this.

The cold hard facts that we have found in our client companies is that right now, today, if you have a warehouse and you have stock then you can immediately do without 15-20% of what you carry. In the worst cases a business carries up to 50% more product than they need.

A quick exercise you can do is run off your stock report and sort by the amount of items per SKU you have sold in the past 12 months. Take a look at the bottom 30% of those, see how many you sold and check how many you have in stock – you’ll amaze yourself. Proactive management consulting companies will ensure you never get into this kind of situation.

If your general response to any of this is “we have to keep this product because…….” Then we can’t help you. If you are open to reducing your stock levels and increasing stock turns then here are a few things you can do right now:

–          Buy Frequently & Small – you will probably say that to get the big discounts you have to buy big orders. Our experience is that Suppliers will almost always give you the discount if you sign up to volume over time, so smaller orders, more frequently will have no adverse effects

–          Simplify you product line – All business carry lines that do not sell. Cull! Get rid, move them on. Have a process that at least every month cut the bottom 5% of slow movers

–          Set up Just-In-Time models – call your suppliers and incentivise them to put in a just in time model.

–          Consignment stock – this kind of model is where your supplier puts the stock in your warehouse, they own it until you pick the product. Depending on consumption they count it daily, weekly, etc. and charge you for the usage. This can be a very effective model for some types of business.

By the way, often the biggest culprit to carrying too much stock is you are one of your employees needing to “keep a bit of that, just in case”. In any event management consulting can identify and implement some very useful stock management systems to help reduce your stock levels.

Quick Contact - Or Call: 01 9011310

Sign Up To Our Latest Transmission

To be sent automatic updates to our latest news articles, please fill in your details.

More News


How Leaders Should Deliver Bad News

When unwanted but necessary decisions are made, employees not only look for answers – they also look for hope. A smart and prepared leader will provide both. Sharing very bad news with employees is among the most difficult and stressful communications a leader can make.

Driving Innovation

Leading In An Unpredictable World

Innovation has always been a turbulent process of venturing into the unknown. Innovation can—and does—happen anywhere & at any time. Three ways business leaders can drive both growth & innovation in today’s fast-evolving and unpredictable environment.

The Business Troubleshooters Ltd.




Ⓒ 2020 - All Rights Are Reserved

Sign Up To Our Latest Transmission


3013 Lake Dr,
Citywest Business Campus,
Dublin, D24 PPT3
Tel: (01) 901 1310


Enterprise House,
O’Brien Road,
Co. Carlow, R93 YOY3
Tel: (059) 910 0440


Acorn Business Centre,
Mahon Industrial Estate
Cork, T12 K7CV
Tel: (021) 2021130

Share on linkedin