The Ultimate Replenishment Planning Guide

Replenishment planning occurs when businesses re-order their most in-demand inventory that is out-of-stock or low. This process’s main purpose is to ensure retailers have the correct product quantity to increase sales and lower costs.

It enables business setups to establish a profitable inventory throughout the season with the ultimate goal of avoiding unnecessary markdowns. However, this process is complicated, especially to smear retailers.

All locations and channels have their considerations like;

  • Local rivals
  • Shipping time
  • Demographics
  • Product seasonability.

Its complexity makes it hard to calculate the ultimate replenishment manually. The components of a good replenishment plan include;

  • Preventing empty shelves by updating inventory when needed
  • Lower shipping costs
  • Prevent unwanted markdowns by supplying the most in-demand products
  • Lower store transfer costs.

How to Make a Replenishment Plan

Below we discuss how to develop a replenishment plan;

  1. Get a General Picture of Your Enterprise

Retail enterprises are often divided into different categories, and every senior leader is answerable to their category. Some common categories include replenishment, assortment, and vendor relations. This causes a breakdown in communication because one group might fail to account for the other category plans.

Companies should handle this by bringing their senior heads together and listing all the essential factors in the organizations influencing replenishing. They will fix this by coming together and creating a process that considers the entire cycle.

  1. Make a List of the Most In-Demand Products

Next, companies should check the product demand before considering a replenishment stock. Besides having demand as the main consideration, retailers should also know how different products move within the market.

The product demand should also be known in all locations since some fulfill clientsā€™ orders directly.

  1. Know the Product Distribution Process

Most people consider replenishment as S&OP because it is dependent on several factors. This means companies should clearly understand different factors in the production cycle. The most important areas to evaluate are;

  • Lead time
  • Manufacturing time
  • Promotions
  • Client order fulfillment.
  1. Advanced Analytics and Leverage AI

Most retailers try to tackle replenishment manually and overlook many essential things in the process. This process is filled with errors and can cause lost sales over time. However, AI technology and analytics have become more advanced today and can create a precise predictive analysis.

Today’s technological ability lets businesses know whether their inputs are reliable using sales planning software.

  1. Be Ready to Manage Risks

This is the last step, and it occurs when the system optimizes the product’s future behavior. Some risks can be handled, and others, like unexpected weather, cannot. A good replenishment plan should have a contingency plan for the most effect.


A replenishment plan helps brands to implement their product pricing and also assists businesses in making massive profits in the process. It spares time that can be directed to more important things like analyzing special projects.

The above article has outlined the complete replenishment planning process, and you can reach out for more information.