For a business to be successful in eCommerce, it requires effective inventory management 📦. One key metric that plays a significant role in understanding and managing eCommerce inventory is Weeks of Supply (WOS). Based on current sales trends, this formula helps businesses gauge how long their inventory will last. How? We'll learn in detail in this article. Let’s start!

What is Weeks of Supply (WOS) in eCommerce?

Weeks of Supply (WOS) indicates how long the current stock will hold out ⏳ based on the average sales pace. Calculating how fast your inventory is depleted helps you create efficient strategies and avoids stockout or excess stock.

This calculation is essential for keeping inventory levels steady during busy periods like Black Friday and Cyber Monday (BFCM).

For example, if your average weekly sales double during this shopping season, knowing your Weeks of Supply (WOS) will help you adjust your inventory purchasing and ensure you have enough stock to meet customer demand without overcommitting resources. By preparing ahead and calculating your WOS, you can strategically plan your inventory to maximize sales while minimizing the risk of stockouts and excess inventory during one of the busiest times of the year.

WOS Meaning in eCommerce Inventory Planning

In inventory planning, Weeks of Supply is essential for effectively managing stock. A business can maintain an adequate supply during a shopping rush by understanding its weekly sales average. With this data, the business can enhance its buying methods and lower the chances of stock shortages and excess merchandise. 📊 But how?

How to Calculate Weeks of Supply (WOS)?

The Weeks of Supply (WOS) formula is quite simple:

To determine how long your stock will last before needing to restock, simply divide your current inventory by your average weekly sales.

For example, let’s say you own an apparel store with 500 items in stock. If you're selling an average of 50 pieces each week, you would calculate your supply duration like this:

WOS = 500 items / 50 items per week = 10 weeks.

This means you can expect your inventory to last approximately ten weeks before you need to restock! Understanding your Weeks of Supply gives you a significant advantage in inventory management. That’s why calculating it and benefiting from it is highly important.

Why Calculating Weeks of Supply (WOS) is Important for your eCommerce store?

Let’s summarize the  key benefits of calculating Weeks of Supply (WOS) to understand its importance better:

Better Inventory Management 📈

Calculating Weeks of Supply (WOS) helps you manage stock flow effectively, ensuring you always have enough inventory in your eCommerce store. By knowing how long your current stock will last, you can replenish on time, balance stock levels, and prevent inventory issues. Accordingly, you can benefit from all the sales opportunities. This simple metric keeps your store running smoothly and keeps your customers happy. 🚀

Avoid Out-of-stock 🚫

For retailers handling a significant number of low-margin products, stockouts must be prevented as a priority. Usually, backorders can offer a temporary solution for stockouts, but this may not work for low-margin products. WOS allows you to build inventory levels that help prevent shortages.

📌 Would you like to learn how to use backorders efficiently for high-margin products when your store is temporarily out of stock? Read How Does Backorder Work?

Minimize Excess Inventory 📦

Keeping unnecessary stock can drain your capital and raise storage costs while increasing the chance of having outdated items. You can manage inventory quantities and enhance their efficiency with an accurate WOS estimation.

📌 Do you need more information to minimize overstock? Learn how to use preorders as a valuable strategy to minimize excess stock.

Improve Demand Forecasting 📅

Accurately determining Weeks of Supply (WOS) helps you predict future sales and manage your eCommerce inventory effectively. By analyzing sales trends, you can forecast demand during peak seasons and adjust reorder points to avoid stockouts. This allows you to prepare for busy periods with enough inventory while optimizing stock levels to reduce excess on slower-moving items.

📌 Read more about how to forecast sales and plan inventory for special times like Black Friday and Cyber Monday(BFCM).

Supply Chain Efficiency 🚚

Gathering information on how long your current stock will last allows you to organize your supply chain efficiently. With a clear understanding of your Weeks of Supply (WOS), you can create purchase orders before running out of stock, enabling you to negotiate better deals and strengthen supplier relationships.

Knowing your WOS also helps you strategically choose to reorder dates, ensuring you’re prepared for peak seasons and avoiding delays. By planning ahead, you can also take advantage of better pricing options with early purchase orders. For more insights on effective inventory planning before, during, and after BFCM, check out our Inventory Planning Playbook.

To sum up, knowing Weeks of Supply (WOS) lets you create purchase orders earlier, ensuring you replenish stock before running out. This proactive approach helps maintain sales continuity, avoid stockouts, and satisfy customers! Well, how can you calculate Weeks of Supply? Is Excel is an option for this?

How to Calculate Weeks of Supply in Excel?

Calculating Weeks of Supply (WOS) accurately requires reliable inventory data. However, Excel is prone to errors due to manual data entry. Studies show that 88% of Excel spreadsheets contain errors, most from human mistakes. 🫠

Calculating Weeks of Supply (WOS) in Excel can be time-consuming. ⌛ In the fast-paced world of eCommerce, timely decisions are crucial for seizing sales opportunities. However, Excel limits your inventory management capabilities, such as calculating Weeks of Supply with its manual structure. Relying on spreadsheets to calculate WOS can slow your restocking process, leading to missed chances and dissatisfied customers. Instead, consider using an automated inventory management solution like Fabrikatör to streamline your calculations and make more informed, timely decisions.

Manage eCommerce Inventory Effortlessly with Fabrikatör!

When your eCommerce business is growing, managing inventory can get tricky. Manual solutions like Excel might seem helpful, but they often lead to human errors and take up much time. Calculating Weeks of Supply and other essential inventory formulas can become a real headache. Luckily, you can automatize inventory management with Fabrikatör, making the whole process much easier and error-free!

You don’t need to calculate any inventory formula in Excel anymore. Fabrikatör shares with you all the inventory insight you may need! Fabrikatör supports the growth of your eCommerce store and automatizes its inventory management process by:

📊 Offering actionable insights to make more reliable inventory decisions,

📝 Helping you create purchase orders in seconds,

🚨 Notifications for low stock levels and replenish your stock on time,

📦 Offering backorders for you to manage out-of-stock situations profitably,

📈 Forecast your store's sales and keep inventory levels balanced,

🚚 Improve your shipping strategy and reduce unnecessary costs with Freight Planning!

Would you like to discover more about Fabrikatör in only 30 minutes? See Fabrikatör in action!

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