Balancing stock is one of the hardest things a business can do well.
Order too much and you tie up capital in products that may never sell, leaving you with discounting or waste. Order too little and you risk missed sales, disappointed customers and a diminished reputation.
With SAP Business One in place, you already have the foundation. But are you using the tools to their full potential to protect cash flow while meeting demand?
The cost of stock inefficiencies
The biggest issue that SMEs face is an imbalance in stock. Over-ordering drives up storage costs and can lead to wastage, while under-ordering creates shortages that frustrate customers and weaken trust in your business.
Even with SAP Business One, accuracy can still be undermined if planning is managed in disparate systems and spreadsheets or if sales forecasts aren’t kept aligned with purchasing and stock. Blind spots creep in, and errors are harder to catch.
Three ways to predict and control stock more effectively
Getting stock right is about having the right systems and practices in place. While every small business is different, the biggest gains come from focusing on three areas.
1. Stay on top of your data
While many businesses still rely on gut feel, the truth is that effective stock control depends on shifting to hard data. Without accurate records, businesses are left guessing when to reorder and how much to hold.
SAP Business One already brings all your data together. The challenge is keeping those records accurate and up to date. By staying on top of your single source of truth for purchasing, sales, inventory and forecasts, you can act with confidence and respond quickly to changes in demand.
2. Make forecasting smarter with SAP Business One and AI
Forecasting is critical to getting stock right. History is a good lesson, but it won’t tell you what to order tomorrow. You could easily drop your forecasting errors by half by using SAP Business One to its full capacity, which means fewer shortages, less excess stock and more reliable cash flow.
The key is to understand the factors that shape demand and make sure they are reflected in your planning:
- Predicting seasonality – the amount of stock needed in January may look very different to March, so blanket rules rarely work
- High-value items – expensive products need closer management than everyday consumables, as the impact on working capital is much greater
- Marketing campaigns – demand can spike quickly when promotions or campaigns land, so forecasts should adjust accordingly
SAP Business One provides the tools to support this. The Material Requirements Planning (MRP) wizard helps businesses forecast demand and generate suggested order quantities. At the same time, minimum and maximum stock fields make it easy to set thresholds for each product and adjust them month by month to reflect seasonality and business cycles. Together, these functions turn forecasting from guesswork into a structured process.
AI takes this one step further. Its power to improve the stock holdings of a small business is extraordinary. By analysing sales, purchasing and inventory data, AI can model different stocking scenarios, highlight risks and point to opportunities. You might not have the mathematical skills, but there are now tools available that will do it for you, for free.
3. Audit stock and supplier performance regularly
Small mistakes add up. You might record 10 items dispatched but actually ship 11, or lose products in the warehouse only to find them weeks later. Even the best system can go awry without regular audits. They allow you to assess the current process to find areas for improvement and reduce errors.
Reviews of supplier performance are just as important. Late deliveries or missed orders can cause businesses to reorder unnecessarily, increasing costs and tying up working capital. Regular audits – both internal and external – keep predictive systems accurate and reliable.
SAP Business One features for smarter stock control
SAP Business One already includes a range of functions that, when actively used, can help your business move from reactive to predictive inventory management.
- MRP wizard – forecast demand and generate suggested order quantities based on sales, purchasing and production data
- Minimum and maximum stock fields – set clear thresholds for each product and adjust them month by month to reflect seasonality and business cycles
- Planning horizon and order settings – define how often to order, along with minimum order quantities and economic order quantities, to keep replenishment consistent and cost-effective
- Alerts management function – create automated alerts and triggers that warn you when stock levels, purchasing activity or other conditions fall outside set parameters
- Forecast storage – save multiple forecasts (for example, best case and worst case) and apply them per month or period, making it easier to plan around seasonality and marketing campaigns
- Scenario planning – export data to Excel to run “what if” models and test different stocking strategies
- Inventory audit report – track stock ageing, manufactured dates and expiry dates, helping to reduce waste and manage products with limited shelf life
These features give managers the visibility and control they need to make decisions based on evidence, not guesswork.
The ROI of getting stock right
When businesses move from reactive to predictive inventory management, the benefits are significant. In our experience, forecasting errors can be halved, stock holdings reduced by 10-20%, and working capital released back into the business. Service levels also improve as customers enjoy the reliability of timely fulfilment and steady availability.
When all your data sits in one place, the real advantage is agility – being able to respond quickly to what the data shows. If demand is rising, you can secure inventory ahead of the curve. If it’s slowing, you can hold back on replenishment and protect cash flow.
By keeping SAP Business One data accurate, applying forecasting and AI, and maintaining regular audits, businesses can take control of their inventory instead of reacting to problems.
Want to get more from your SAP Business One system? Talk to KBS about configuring your solution for smarter stock control.
