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Inventory questionhow much inventory should I order from each supplier

How much inventory should I order from each supplier?

You should order enough inventory from each supplier to cover forecast demand over the next replenishment cycle plus safety stock, while staying within cash and storage limits. Use EOQ from /calculators/eoq-calculator as a starting point, then adjust for supplier MOQs, discounts, and lead time risk.

$1.77T lost to inventory distortionIHL Group

Overview

Order quantity is where forecasting meets cash management. Too small and you pay excess freight and handling; too large and you lock up cash and create dead stock, which is already a known risk in ecommerce. Using structured ordering rules like EOQ, along with supplier constraints and lead time variability, helps you allocate orders across vendors instead of guessing.

Start from EOQ, then layer real-world constraints

Use the EOQ calculator at /calculators/eoq-calculator to get a mathematically efficient order size, then compare that to each supplier’s MOQ and price breaks. The EOQ formula gives you a neutral baseline before you decide whether it is worth holding extra units to hit a discount tier or consolidate freight.

Allocate using demand forecasts and lead times

Pull SKU-level demand forecasts from your planning workflow or /guides/shopify-inventory-forecasting-guide, then align order quantities to each supplier’s lead time variance of around 20–30% where relevant. Suppliers with more volatile lead times may justify larger safety stock buffers and slightly larger orders than local vendors with stable supply.

Respect cash and carrying cost limits

Remember that inventory carrying cost is typically 20–30% of unit cost per year, so doubling an order to get a small unit discount can easily destroy margin. Use that 20–30% benchmark as a hard constraint when evaluating whether a larger PO makes financial sense for a given SKU and supplier.

Plan PO sizes ahead of Stocky’s sunset

Stocky, Shopify's native inventory planning app, is being discontinued on August 31, 2026, and Shopify is not replacing its purchase order quantity logic. If you currently let Stocky suggest PO sizes per supplier, migrate that logic into Synplex or another planner so you still get data-driven order quantities after Stocky is retired.

Worked examples

Fashion brand ordering from two overseas suppliers

  • Forecast demand next cycle: 1,000 units
  • EOQ from calculator: 600 units
  • Supplier A MOQ: 400 units
  • Supplier B MOQ: 300 units
  1. 1. Run /calculators/eoq-calculator to get EOQ of 600 units.
  2. 2. Allocate 600 units across suppliers while meeting MOQs, such as 400 units from Supplier A and 200 units from Supplier B.
  3. 3. Check that the total order value aligns with cash limits and carrying cost of 20–30% of unit cost per year.

Result: You place a 400-unit PO with Supplier A and a 200-unit PO with Supplier B to meet EOQ and MOQs without overcommitting cash.

EOQ gives a starting quantity; MOQs and cash constraints refine how much to allocate to each supplier in a realistic way.

How to apply this in Shopify

  • Use Shopify Analytics → Sales by product to understand per-SKU demand before deciding how much to order from each supplier.

  • Record supplier names and costs on each line in Admin → Purchase orders so you can later analyze which vendor delivers the best landed cost.

  • Use Admin → Transfers if you bring bulk stock into a primary warehouse from one supplier and then move units to secondary locations.

  • Track quantity for all purchase-led SKUs using the Product variant → Track quantity toggle so committed POs reflect in available to sell.

  • Review open POs in Admin → Purchase orders weekly to confirm quantities and adjust future orders if demand deviates from forecast.

Common mistakes

Ordering only to hit discount tiers

Chasing a small per-unit discount often leads to months of excess stock and higher carrying costs than the discount saves.

Fix: Use EOQ from /calculators/eoq-calculator and the 20–30% carrying cost benchmark to decide whether the larger PO is truly profitable.

Ignoring supplier lead time variability

Assuming fixed lead times for overseas suppliers that actually fluctuate by around 20–30% leads to either risky small orders or bloated safety stock.

Fix: Incorporate lead time variance guidance from /guides/supplier-lead-time-guide-shopify into your reorder and PO sizing logic.

Relying on Stocky PO suggestions indefinitely

Depending on Stocky to suggest quantities without a migration plan leaves a gap once it is discontinued in August 2026.

Fix: Export historical PO data from Stocky and feed it into Synplex so you can keep similar logic with more transparent controls.

Treating all suppliers the same

Applying a single rule to all vendors ignores different MOQs, reliability levels, and freight economics.

Fix: Segment suppliers into tiers in and set different target order quantities and safety stock per tier.

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