Guide
How much inventory should a growing CPG brand hold?
Enough to not stock out — and not a unit more. Here's how to set the target and hold to it.
In short: A growing CPG brand should hold enough inventory to cover its replenishment lead time plus a safety-stock buffer — expressed as a target weeks-on-hand (often 4–8 weeks) per SKU per location. More than that is cash trapped in overstock; less risks stockouts. Set the target by lead time, demand variability, and cash constraints, then plan replenishment to it.
Set a target, not a gut feel
The right amount is a target weeks-on-hand that covers lead time plus safety stock. Long-lead or highly variable SKUs need a bigger buffer; fast, predictable movers need less. Hold every SKU to its own target rather than one blanket rule.
Balance coverage against cash
Every extra week of days-on-hand is cash you can't deploy elsewhere, plus storage and obsolescence risk. The goal is the minimum inventory that protects your best-sellers — trim the tail and the over-orders. See days-on-hand & cash →
Frequently asked questions
How much inventory should a CPG brand hold?
Enough to cover replenishment lead time plus safety stock — a target weeks-on-hand (often 4–8 weeks) per SKU per location. More is trapped cash; less risks stockouts.
How do I lower inventory without stocking out?
Set per-SKU coverage targets, trim SKUs above target, and protect the ones below it. SpyGlass plans replenishment to a days-on-hand target automatically.
What is safety stock?
Extra buffer inventory that absorbs demand and lead-time variability so normal swings don't cause a stockout.
See your stockouts and dead stock before they cost you
Book a 30-minute call. We'll map your channels, FCs, and SKUs live and show where cash is trapped and where you're about to run out.
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