Inventory Forecasting Tips for Australian Retailers: Avoid Stockouts and Cut Freight Costs

Stockouts and rising freight costs are major challenges for Australian retailers. Inventory forecasting offers a powerful way to overcome these issues. Out-of-stock rates can reach up to 15% in Australia, leading to missed sales and frustrated customers. Freight costs have also surged, with the value of Australia's imports of freight services hitting a record high of $2.6 billion in August 2022.

These challenges highlight the need for effective inventory forecasting. By accurately predicting stock needs, retailers can minimise product unavailability and avoid costly emergency shipments. This approach ensures that products are available when customers need them. 

In this article, we'll explore practical inventory forecasting strategies tailored for Australian retailers. Whether you're running an e-commerce store or a physical shop, these insights aim to help you keep inventory balanced and freight expenses under control.

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What Is Inventory Forecasting?

Inventory forecasting involves predicting the quantity and timing of future stock requirements. It uses past sales data, seasonal trends, and upcoming events. It enables you to maintain optimal stock levels without overinvesting in inventory.

For Australian retailers, getting this right is crucial. Out-of-stock situations can lead to missed sales and unhappy customers. On the flip side, overstocking can result in increased storage costs and potential waste. By accurately forecasting inventory needs, you can strike the right balance, keeping your customers satisfied and your costs in check.

Inventory forecasting differs from demand planning. While demand planning focuses on predicting customer demand, inventory forecasting takes it a step further by determining how much stock you should order and when to replenish it. Knowing the difference between the two helps make more informed decisions about purchasing and stocking levels.

Adding inventory forecasting to your business strategy can lead to more efficient operations and can lead to more efficient operations and improve the overall buyer experience.

3 Benefits of Inventory Forecasting in Freight and Supply Chain

Inventory forecasting can help you avoid common headaches such as running out of stock or paying too much for freight. Here’s how it makes life easier for Australian retailers:

Fewer Stockouts and Emergency Orders

No one likes telling customers that a product is sold out. With proper forecasting, you can stay ahead of demand and avoid those panic reorders. This also means less expensive last-minute orders that disrupt your operations and budget.

Lower Freight Costs

You can avoid expensive express deliveries when you plan ahead. You’ll have more time to choose cheaper options like bulk shipping or sea freight. This cuts shipping costs by a big margin, especially if you’re ordering from overseas.

Better Delivery Times and Happier Customers

Inventory forecasting helps keep orders moving smoothly. When your shelves are stocked and freight is well-timed, you can ship faster and meet delivery expectations. That results in happier and more regular customers.

2 Types of Inventory Forecasting Methods

Not all inventory forecasting is done the same way. Depending on your business, you might rely on experience, sales data, or a mix. Here are the main types of inventory forecasting methods:

Qualitative Forecasting

This method relies on intuition, team input, and industry know-how. It’s great when you don’t have much data. For instance, when launching a new product or entering a new category. For example, a local boutique owner might predict higher sandal sales based on warmer weather and past conversations with regular customers.

Quantitative Forecasting

This approach uses hard figures, such as historical sales data, customer orders, and growth trends. It’s more accurate and works best when you have a few months or years of data to work with.

Here are some popular types of quantitative forecasting:

• Time-Series Forecasting: Looks at your past sales to predict future demand. Useful for stable products such as pantry staples or personal care items.
• Trend Forecasting: This method helps spot long-term growth or decline in sales. It is great for categories such as tech or health products that shift over time.
• Seasonal Forecasting: PThis method predicts peaks and dips based on the time of year, such as sunscreen in summer or chocolates during Easter.

Big retailers and FMCG brands often use a mix of these to stay prepared. But even small businesses can start simple and see big wins. Familiarising these methods can help you choose the right one for your store and take the guesswork out of inventory forecasting.

Inventory Forecasting for Shopify and eCommerce Retailers

If you're running a Shopify store, inventory forecasting doesn’t have to be complicated. Shopify has built-in tools that make it easier to predict what you'll need and when.

Shopify’s reporting tool displays a clear view of historical sales insights to help you spot trends and plan stock levels. You can also use apps that pull in your sales data and suggest how much to reorder. These tools can even show you when you’re likely to run out of stock.

Many forecasting tools connect directly with your fulfilment and logistics platforms. That means your inventory plan can automatically trigger reorders or shipments. 

How Forecasting Helps Reduce Freight Costs

Inventory forecasting goes beyond stock control, it also reduces freight costs when done right. Here’s how:

Plan Freight Around Stock Needs

When you know what products are needed and when, you can schedule deliveries that make sense. Instead of rushing orders, you can plan shipments to arrive on time and without paying extra for express freight.

Avoid Expensive Last-Minute Shipping

Rush deliveries often lead to expensive express freight. And these last-minute charges can hurt your bottom line. With proper forecasting, you can stay ahead of low stock and avoid the scramble.

Consolidate Shipments to Save More

You can combine multiple orders into a single delivery if you plan ahead. This means fewer shipments, reduced freight costs, and less time spent managing arrivals. It’s especially useful when working with overseas suppliers or multiple product lines.

Implementing an Inventory Forecasting System

Getting inventory forecasting right starts with choosing the right tool. Look for a tool that gives you clear stock visibility, tracks past sales, and helps you predict future demand. A good system should alert you when items are running low and suggest how much to reorder. It’s even better if it can factor in seasonal trends or let you set buffer stock levels to avoid running out.

Make sure the tool is easy to use. You don’t need something overly technical. A simple dashboard that shows what you need at a glance can save you hours each week.

Another factor is how well it connects with your freight and logistics setup. Tools that sync with platforms like Couriers & Freight help you plan better. If your inventory system knows when stock is due to arrive, it can help you schedule deliveries more efficiently.

Integration also cuts out double-handling, such as manually re-entering order details across separate systems. It ensures your orders, freight, and fulfilment are all in sync. 

3 Tips for Australian Retailers

Inventory forecasting is simple to start but essential to get right. Use these three tips to stay ahead:

1. Stay on Top of Stock Levels: Keep an eye on what’s moving and what’s not. Regular stock checks and reports can help you avoid over-ordering or running out of bestsellers.
2. Plan for Peaks: Think ahead for busy periods like End-Of-Financial-Year (EOFY) sales, Christmas, or back-to-school. Look at last year’s numbers and build in extra time for freight delays.
3. Use Tools That Talk to Each Other: Choose systems that connect your inventory and freight. 

Take Control of Your Inventory Stock

If you’re tired of missed sales opportunities, last-minute freight costs, or the constant strain of managing a fragmented supply chain, now is the time to improve your inventory system. Forecast smarter, cut freight costs, and boost customer loyalty.

Need a hand bringing it all together? Couriers & Freight offers supply chain management services that connect your inventory planning with smart, reliable freight solutions.

Stay ahead of your competitors and contact us to help you simplify your stock and improve your shipping today.

Improve Inventory Forecasting and Cut Freight Costs

Take control of your stock planning and avoid expensive freight surprises. Couriers & Freight connects smart inventory forecasting with reliable shipping solutions.

Get a Quote Now