How Much Stock Do You Really Need?

22 Oct 2026 · 1 min

Watch on YouTube

0:46

In this segment of the YouTube video, Jacqueline Snyder and a co‑speaker discuss how product‑based business owners can assess whether they hold too much, too little, or the wrong inventory. They frame inventory as cash tied up on shelves that must be turned over. The core recommendation is to align stock levels with projected sales, using a three‑month supply as a common rule of thumb, while acknowledging that faster‑turning businesses can operate with one to two months of stock. The overarching strategy is to keep inventory as low as possible without harming sales, emphasizing quick replenishment and avoiding bulk stockpiling.

Chapters

How does a product-based business owner know if they've got too much inventory, too little inventory, the wrong inventory? Because now we're talking about money getting trapped. Literally, your product is cash sitting on shelves and we have to turn it over.
The first thing I would always say is that the amount of stock that you should have always should be tied to the amount of sales that you're planning. And I think 3 months can be a good rule of thumb. It doesn't work for everybody. And also, if you're turning faster than 3 months, if you're like, I've only got enough stock to last me 1 month or 2 months, but that seems to work for me and I get my top-up orders quickly. Don't bulk up to 3 months because basically it's a game and the game that we're playing is how little stock can I have without impacting my sales?