Stock management software has simplified inventory management for millions of businesses across the globe, from multi-national retailers to independent builders’ merchants.

If your company uses stock control software, no doubt you’ve set base levels for stock – if stock falls below these levels, your software will add the item to a purchase order automatically. All you have to do is review the numbers and confirm the order.

There’s no doubt that software has significantly reduced many of the old stock management problems that used to blight SME retailers, but there are still some situations where anomalies or stock crises will occur and you’re left with empty shelves. Contingency planning can limit the effect these stock anomalies have on your business – but what do you need to consider when formulating such a plan?

Preparing for the worst

First of all, determine the nature of potential crises. These might include:

·         A sudden, unexpected spike in sales of a particular product or product type.

·         A product gets discontinued, but you’ve already told customers you would order some in for them.

·         A supplier runs out of a key product and don’t know when they’ll have stock in again.

·         Cash flow problems put a halt to purchase orders, meaning you’ll miss out on important seasonal sales.

·         Lack of space in your warehouse for new orders due to dead stock.

Depending on the structure of your business, some of these problems may have more of an impact than others. If you have an online store, these issues tend to be even more problematic.

Creating a contingency plan

Once you’re aware that there’s a major problem with your stock, you must react quickly to eliminate its effect on your business. If you have contingency plans already drawn up, this process will be easier – and you’ll be less likely to panic and make poor decisions that exacerbate the problem.

In many cases, if you have a good relationship with your suppliers they may be willing to help you solve the problem. For example, they may understand if you need to return products that simply aren’t selling. Additionally, if you are suffering from a restricted cash flow, you may be able to negotiate on minimum order values. Good communication with your supplier can also help you determine the time it’ll take to have items back in stock and available for customers to purchase or collect.  

Also, consider how you will communicate issues with customers. If you have an online shop, this is particularly important. Only share information on stock availability if you know it to be accurate – don’t guess that products will be back in stock within a certain timeframe if your suppliers haven’t given you a date. Use your social media channels and website to communicate that you have stock issues and are working to resolve the problem. Communication is also key with in-store customers, particularly valuable trade customers whose custom you can’t afford to lose.

When drawing up your contingency plans, you may also wish to consider creating a shortlist of alternative suppliers who you’ll turn to stock key products if others let you down. Carrying out such a task at the height of a crisis isn’t likely to go well – the last thing you want to do is decide on suppliers when you’re in a rush to resolve problems.


Even the most well-organised business will face the occasional stock crisis, so it pays to be prepared for them. By formulating a basic contingency plan for each of the most likely stock problems, you can significantly reduce the impact they have on your business.

Managing your stock on a daily basis can be equally challenging. Stock control software can prevent many of the stock management headaches your company faces. Give us a call if you’d like to see it in action.