A minimum stock level is the quantity at which you reorder. Set it too low and shelves go empty. Set it too high and money sits in the stockroom. Most shops set minimums once, by feel, and then ignore the alerts. Here is a better way.
The rule
Minimum = daily sales × days the supplier takes to deliver + a safety amount.
If you sell 8 bags of rice a day and your supplier delivers in 4 days, you need 32 bags to last until the delivery arrives. Add a safety amount for busy days, for example 2 days of sales, which is 16 bags. Your minimum is 48.
Where the numbers come from
Daily sales: Diwaan shows the average daily sales for each item over the last 30, 60 or 90 days. Coming Use 30 days for fast-moving items and 90 days for slow ones.
Delivery time: record it on each supplier. Diwaan measures the real time from order to delivery, so you can see if a supplier is slower than they promise. Coming
Start with the items that matter
You do not need minimums on every item on day one. Set them for the 30 items that sell the most. These are usually most of your sales.
Act on the list
Each morning, Diwaan lists items below their minimum, by branch. Turn the list into a purchase order in one step, or move stock from a branch that has too much. Either way, the decision takes minutes, not a walk through the stockroom.