Inventory Forecasting Tools for Small Shops
Running out of your best seller is painful. So is a stockroom full of products nobody wants. Inventory forecasting tools use your sales history to suggest what to reorder and when, so you tie up less cash and miss fewer sales. This guide explains what these tools do, compares three names you will hear about, Inventory Planner, Cin7 and Prediko, and helps you decide whether you need one yet.
Key takeaways
- Inventory forecasting tools predict demand from your sales history and suggest reorder quantities and timing.
- Inventory Planner and Prediko focus on demand planning and purchasing. Cin7 is a broader inventory management system with forecasting features.
- A spreadsheet can work well for a small catalog. A dedicated tool earns its place as products, suppliers and sales channels grow.
- Two simple measures help you judge results: inventory turnover and gross margin return on inventory (GMROI).
- Check each tool's current features, integrations, pricing and privacy policy before you commit.
Early July is a good time to think about this. The first half of the year has given you fresh sales data, and the orders you place over the next few weeks may decide what you have on the shelves for back-to-school, autumn and the busy end of the year. A better forecast now can save you from both empty shelves in November and leftover stock in January.
What inventory forecasting tools actually do
Most tools in this category connect to your shop or point-of-sale system, pull in sales and stock data, and turn it into purchasing suggestions. The details vary, but the core jobs look like this.
- Demand forecasts. Estimates of how many units of each product you are likely to sell over the coming weeks or months, often adjusted for trends and seasonality.
- Reorder suggestions. Recommended order quantities and dates for each product, based on the forecast, current stock, stock already on order and supplier lead times.
- Purchase orders. Many tools let you turn suggestions into purchase orders to send to suppliers.
- Overstock alerts. Flags for products with more stock than expected demand, so you can plan promotions or pause reorders.
- Reports. Views of stock value, sell-through and slow movers across products, locations or channels.
A tool does not know about the influencer who is about to feature your product, or the supplier who is quietly running late. Forecasts are a starting point for your judgment, not a replacement for it.
Do you need a tool or will a spreadsheet do?
Plenty of small shops forecast perfectly well in a spreadsheet. The question is when the spreadsheet starts costing you more time and mistakes than a tool would.
A spreadsheet is often enough when
- You sell a small number of products from one or two suppliers.
- You sell mainly through one channel, such as one online store.
- Your sales are fairly steady, without big seasonal swings.
- You enjoy reviewing the numbers yourself each month.
A dedicated tool may help when
- Your catalog has many products, sizes or colors to track.
- You sell across several channels or locations.
- Suppliers have long or variable lead times, or minimum order quantities.
- You keep running out of best sellers or sitting on slow stock.
- Reordering takes hours every month and errors keep slipping in.
Pro tip
Before you buy any tool, clean up your product data. Make sure every product has a consistent SKU, a supplier, a lead time and an accurate stock count. A forecasting tool fed with messy data will give you confident but wrong answers.
The three tools at a glance
Here is a general overview of each option. Products and integrations change often, so check current features, supported platforms, pricing and privacy policies on each provider's own site.
Inventory Planner
Inventory Planner is a demand forecasting and purchasing tool for online retailers and wholesalers. It focuses on predicting demand, recommending what to buy and helping you create purchase orders. It tends to suit shops that already have an ecommerce platform for selling and want a dedicated layer for planning purchases.
Cin7
Cin7 is a broader inventory management platform that covers stock across warehouses, channels and locations, with order management and forecasting features. It tends to suit growing businesses that need one system to manage inventory across several sales channels, rather than only a forecasting add-on. Expect more setup than a single-purpose tool.
Prediko
Prediko is an inventory forecasting and planning tool aimed at ecommerce brands, particularly those selling on Shopify. It focuses on demand forecasts, purchase planning and stock alerts, and suits online brands that want planning built around their store data.
Focused forecasting tools (Inventory Planner, Prediko)
- Built around demand forecasts and purchasing
- Usually quicker to set up on top of your store
- Clear reorder suggestions for small teams
Broader inventory systems (Cin7)
- Manage stock across channels and locations in one place
- More setup and training to get running
- May be more than a single-store shop needs
Two numbers that tell you if forecasting is working
Whatever tool you use, track a couple of simple measures over time. They show whether better forecasting is turning into healthier stock.
Inventory turnover equals cost of goods sold divided by average inventory. If it is rising while you avoid stockouts, your forecasting is helping. If it falls, you may be buying ahead of demand.
Gross margin return on inventory (GMROI) equals gross margin divided by average inventory at cost. It shows how much gross margin each unit of money tied up in stock earns. It is especially useful for comparing product categories: a category with low GMROI may be taking up cash and shelf space that would work harder elsewhere.
A quick note: this is general information on inventory and finance, not accounting or financial advice. For decisions about stock valuation, tax treatment or financing purchases, talk to a qualified accountant.
How to choose and roll out a forecasting tool
- Define the problem. Write down whether your main pain is stockouts, overstock, slow reordering or all three. This tells you which features matter.
- Check integrations. Confirm the tool connects to your ecommerce platform, such as Shopify, WooCommerce or BigCommerce, plus any point-of-sale or accounting system you rely on.
- Clean your data. Fix SKUs, supplier details, lead times and stock counts before the trial starts.
- Trial on real products. Compare the tool's suggestions with what you would have ordered for your top products. Ask why the numbers differ.
- Set your rules. Enter lead times, minimum order quantities and how much safety stock you want for key products.
- Start with your best sellers. Use the tool for your top products first, then extend to the rest once you trust it.
- Review monthly. Track stockouts, overstock, inventory turnover and GMROI, and adjust settings as you learn.
Reorder planning template
Whether you use a tool or a spreadsheet, a simple reorder sheet keeps decisions clear. Copy this table and add one row per product. All figures below are made-up examples.
| Product (SKU) | Avg weekly sales (example) | Stock on hand | On order | Supplier lead time | Safety stock | Suggested reorder |
|---|---|---|---|---|---|---|
| Canvas tote, natural (TOTE-01) | 20 units | 60 | 0 | 4 weeks | 40 | Order now, about 100 units |
| Notebook, A5 lined (NB-A5) | 35 units | 300 | 100 | 3 weeks | 50 | No order needed yet |
| Pencil set, 12 colors (PEN-12) | 15 units | 40 | 0 | 6 weeks | 30 | Order now, check back-to-school demand |
The basic logic: if stock on hand plus stock on order will not cover sales during the supplier lead time plus your safety stock, it is time to reorder. A forecasting tool automates this and adjusts for trends and seasons, but the thinking stays the same.
Hypothetical example
Leo runs an online stationery shop with a growing catalog and two suppliers overseas. Last year he ran out of his best-selling pencil sets in late August and still had boxes of planners in February. This summer he cleans up his product data, trials a forecasting tool on his top products and enters realistic lead times. The tool flags that his pencil sets need ordering weeks earlier than he expected. He places the order in early July, keeps an eye on the suggestions each month, and uses the overstock report to plan a small promotion on slow planners instead of reordering them.
Common mistake
Trusting a forecast built on a period when you were out of stock. If a product sold zero units for three weeks because it was unavailable, the tool may think demand fell. Mark stockout periods or adjust the history so the forecast reflects real demand, not empty shelves.
Your inventory forecasting checklist
- Write down your main inventory problem: stockouts, overstock or slow reordering
- Clean up SKUs, suppliers, lead times and stock counts
- Calculate current inventory turnover and GMROI as a baseline
- Check which tools connect to your shop and point-of-sale systems
- Trial a tool on your best sellers and compare its suggestions with your own
- Set lead times, minimum order quantities and safety stock
- Place orders for back-to-school and autumn with lead times in mind
- Review stockouts, overstock and key ratios every month
Frequently asked questions
How much sales history do I need for forecasting?
More history usually helps, especially to spot seasonal patterns. If you have less than a full year, forecasts can still be useful for steady sellers, but use extra judgment around seasonal peaks and new products.
Can a forecasting tool handle new products?
New products have no sales history, so tools often rely on similar products or manual estimates. Start with a cautious first order, watch early sales closely and reorder quickly if demand is strong.
What is safety stock?
Safety stock is extra inventory you hold to cover unexpected demand or supplier delays. How much you need depends on how variable your sales and lead times are, and how costly a stockout would be for that product.
Should I choose a forecasting tool or a full inventory system?
If your main need is better purchasing decisions for one online store, a focused forecasting tool may be enough. If you manage stock across several channels, warehouses or locations, a broader system such as Cin7 may fit better. Trial before you decide.
Related reading
The bottom line
Inventory forecasting tools such as Inventory Planner, Cin7 and Prediko turn your sales history into clear reorder suggestions, helping you avoid both empty shelves and dusty stock. A spreadsheet can serve a small catalog well, but as products, suppliers and channels grow, a dedicated tool can save hours and costly mistakes.
Start with clean data, trial a tool on your best sellers, and track inventory turnover and GMROI each month. Order early for the busy months ahead, and let the numbers guide your next buying decision.
