How to Prevent Stockouts Before They Happen

There is nothing more frustrating for a B2B buyer than placing a large order, only to receive a call three hours later explaining that the items are actually out of stock. Stockouts damage trust and send your buyers straight to your competitors.

Here is how you can use modern ERP tools to completely eliminate stockouts from your operation.

1. Set Automated Low-Stock Thresholds

Not all products sell at the same velocity. You should analyze your sales data to determine the "lead time" (how long it takes your supplier to deliver) and your "average daily sales" for each item.

Use this to set a dynamic Low Stock Threshold in your ERP. The moment your available quantity drops below this number, the system should flag it immediately.

2. Separate "Allocated" from "Available"

One of the biggest mistakes distributors make is looking at total "Quantity on Hand" rather than "Available Quantity". If you have 100 laptops in the warehouse, but 90 of them have already been sold (but not yet shipped), you only have 10 available to sell!

Ensure your system strictly separates physical stock from allocated stock.

3. Leverage Automated Procurement

When a product hits its low-stock threshold, your procurement team shouldn't have to manually type out a Purchase Order. Your ERP should automatically draft a PO for the primary supplier, pre-filled with the required restock quantities, requiring just a single click to approve and send.

By implementing these three strategies, you can ensure your shelves remain perfectly stocked, maximizing both revenue and customer satisfaction.