One of the biggest concerns for any business owner is the size of their order. Knowing how much inventory to order, what raw materials to purchase, and how much of everything to have on hand is a crucial part of running any business.

But just how do you go about estimating your order size? In this article, we’re going to explore some of the ways you can do just that.

Method #1: Historical Data

One of the easiest and most obvious ways to estimate your order size is to look at your historical data. By analyzing past sales, you can get a sense of how much inventory you need to order for the coming weeks or months.

For example, let’s say that last year your business sold 10,000 widgets in May. Based on that data, you can predict that you’ll need to order at least 10,000 widgets for May of this year (assuming your sales remain consistent).

Method #2: Analyzing Trends

Another way to estimate your order size is to analyze trends within your industry and customer base. This goes beyond just looking at historical data and involves looking at broader patterns and changes that may impact your business.

For example, if you own a flower shop and notice that pastel-colored flowers are becoming increasingly popular among your customers, you may want to order more of those types of flowers to meet demand.

Method #3: Industry Benchmarks

When in doubt, it can be helpful to look at benchmarks within your industry to get a sense of what other businesses are doing. This can help you set reasonable expectations for your own order size.

For example, if you own a bakery and notice that other bakeries in your area tend to order 100 bags of flour a month, you may want to order a similar amount to stay competitive.

Method #4: Customer Feedback

Finally, one of the best ways to estimate your order size is to simply ask your customers what they want.

By soliciting feedback from your customer base, you can get a sense of what products are popular and what products may need to be ordered more or less frequently.

For example, if you own a restaurant and notice that your customers are always asking for a certain type of seafood dish, you may want to order more of that type of seafood to meet demand.

Conclusion

Estimating your order size can be a daunting task, but it’s a crucial part of running any business.

By utilizing historical data, analyzing trends, looking to industry benchmarks, and soliciting feedback from your customers, you can get a sense of what products you need to order and how much of each product to order.