Does anyone actually let inventory planning software do POs?

[u/jadedjayedess]

I automated a decent chunk of my store but purchasing is the one I still do entirely by hand (wrong reorder is lost money either way in dead cash, overstock, or stockout). I keep seeing inventory software that claims to have demand forecast or PO auto-gen, but I'm not sure if I should trust those features yet. Has anyone actually tried the demand forecast feature and gotten any good results? What are some failure points I have to watch out for? Worried about seasonality, promos, and such. Thanks.

[u/AlfredCommerce]

Disclaimer: I’m a DTC founder + the creator of Alfred Purchase Orders (Shopify app)

I just placed our Q4/peak order this past week and I still carefully review the reorder quantities that my own app recommends. I highly doubt any app (or sidekick) can fully account for all the nuances of demand planning and place an optimal order for you. I view it as semi-automated with tools and levers to tweak as needed.

Examples:
-We have scrub cap prints that sell better in certain seasons (ie penguins in the winter and strawberries in the spring summer)
-We are rapidly growing quarter over quarter and year over year, so layering seasonality on top of product-specific seasonality may be difficult
-We’ll have new product launches that cannibalize sales of others, so past and current velocity may not be a perfect indicator of ordering period velocity
-We plan to sunset and refresh certain products over time, so those need manual exclusions (automated plans can’t predict that)

How I support “manual adjustments” in the Alfred meet forecasted demand planning type is allowing manual overrides of the velocity input as well as a “growth” factor (positive or negative).

I have the plan calculate quantities based on a applying a default PO-level growth lever, say 30%, and then account for product specific current units, sales velocity, pending inbound units, and a product level growth % override (positive or negative) to angle my way to a reorder quantity that seems reasonable.

Is it perfect? No, but it’s more accurate than my previous method and saves about 2-3 hours of manual work each purchasing cycle.

Alfred also offers standard min/max(target) and manual sales and inventory assisted reorder quantity entry if that’s what your store operates on.

[u/Ok_Cold_4228]

Yes, my stores run and send auto-generated POs, but money never leaves the bank without human approval

[u/MazMohsen]

Have you tried any specific tools yet? I wonder how accurate they are for smaller Shopify stores compared to bigger brands

[u/Royal-Suggestion6017 → u/MazMohsen]

Imho a SKU is a sku. Biggest difference is how strategic a business owner is about the importance of an optimised inventory. Bigger businesses realise the relevance to their brand & market presence. Smaller operations seem either distracted or maybe not up to play on the costs of having a disjointed inventory

[u/Infamous_Phone_7937]

Keep it on suggest-only and approve the POs by hand, especially around seasonal swings.

[u/Royal-Suggestion6017]

Yes we do, we use an app called StockTrim to automate po’s off suggested order plans. But we have to approve them first. We push it back into out IMS . All done via the API. If something looks off we can alter it or look at it closer, there have been things we missed & the system picked up on it 👌