We use all of these tools, and more, to help our clients maintain the right amount of inventory.
Let’s walk through the simplified version of a forecasting process that we follow with our clients:
Step 1: We Calculate the Daily Sales Velocity
We use the last 30, 60, or 90 days of sales data for each SKU, adjusting for:
- Seasonality (Q4 is not like Q2)
- Promotions
- Price changes
Example: 300 units sold in 30 days = 10 units/day
Step 2: We Determine Lead Time
We break it down by:
- Manufacturing: 14 days
- Freight: 30 days (sea)
- Prep + Amazon receiving: 7 days
Example: Total lead time = 51 days
Step 3: We Set the Reorder Point
We use the ROP formula:
- ROP = (10 units/day × 51 days) + 100 units safety stock
- ROP = 610 units
When a client’s FBA inventory hits 610 units, we know it’s time to reorder.
Step 4: We Forecast Future Demand
We project the demand for the next 3–6 months. We take into account:
- Past sales trends
- Upcoming holidays or events
- Marketing plans
- New competitor listings
We use these projections to help our clients determine how much inventory to stock and when.
Step 5: We Monitor and Adjust Weekly
Forecasting isn’t set-it-and-forget-it. We review performance weekly or biweekly:
- Adjust for real sales vs. forecast
- Watch for delays in freight or production
- Factor in changes in ad spend or pricing
Our dynamic FBA forecasting techniques help our clients avoid major surprises.
How to Avoid Stockouts (Without Overstocking)
Always include safety stock, especially if you rely on overseas suppliers or freight.
- Use Dual Inventory Models
Store part of your inventory in a third-party warehouse (3PL) for quicker re-supply to Amazon.
Tools like SoStocked or Inventory Planner let you automate reminders based on reorder points.
If one supplier or freight forwarder becomes a bottleneck, your entire FBA system stalls. Build backup plans.
Amazon uses your Inventory Performance Index to determine restock limits. Avoid long-term storage fees and keep your sell-through rate healthy.
Common Forecasting Mistakes We Avoid
Q4 data won’t reflect Q1 performance. Use YoY comparisons where possible.
Amazon’s restock suggestions are often conservative or delayed. So we combine multiple data points.
- Not Accounting for Lead Time Variability
Manufacturing delays, port congestion, and customs can all add weeks. We pad lead times accordingly.
In the absence of reliable data, we advise our clients to order conservatively and scale up because over-ordering kills cash flow.
- Not Syncing Ads with Forecasts
If a client is planning a PPC push or a lightning deal, we advise them to increase their stock forecasts to avoid mid-campaign stockouts.
Advanced Tips for Pro Forecasting
If you’re ready to level up your inventory management, here’s what we have learned, works:
Implement ABC Inventory Classification
- A items: High volume, requires close monitoring
- B items: Moderate sellers
- C items: Low movers, restock sparingly
This helps prioritize where to spend forecasting energy.
Forecast 90–180 days ahead, but update the forecast weekly or monthly. This keeps it current without reacting emotionally to daily changes.
- Align FBA Forecasting with the Marketing Calendar
Your forecast should integrate with:
- Product launches
- Email campaigns
- Prime Day or Black Friday plans
Track Inventory Across All Channels
If you sell on Shopify, Walmart, or wholesale, track inventory as a whole to avoid duplicate orders or out-of-sync restocks.
FBA forecasting inventory planning isn’t a nice-to-have skill but a core discipline of every successful Amazon business.
Without it, you’re flying blind. You’re risking:
- Lost revenue from stockouts
- Wasted capital in excess inventory
- Missed growth opportunities
With a solid FBA forecasting system in place, you can:
- Scale faster without fear
- Plan cash flow with confidence
- Handle peak seasons like a pro
Need us to take care of your FBA Forecasting to take control of your profits?
