Why Forecasting Matters
Order too little stock and you run out — losing sales, ranking, and Buy Box share while Amazon shows your listing as unavailable. Order too much and your capital is tied up in excess inventory while storage fees accumulate. Good demand forecasting hits the sweet spot — enough stock to avoid stockouts with minimal excess that drains profitability.
Basic Forecasting Method
The simplest approach uses your recent sales data. Take your average daily sales over the past 30 days and multiply by the number of days until your next restock arrives (including supplier lead time, shipping time, and FBA receiving time). Add a safety buffer of 20 to 30 percent for demand variability. This gives you a reasonable reorder quantity for stable, established products.
Accounting for Growth
If your sales are growing (through advertising, improved listings, or market expansion), a backward-looking average will underestimate future demand. Adjust your forecast upward to account for the growth trend. Look at your month-over-month growth rate and project it forward. Better to have slightly too much stock during a growth phase than to stockout and lose momentum.
Seasonal Adjustments
Many products have seasonal demand patterns. If you sold significantly more in Q4 last year, factor that uplift into your forecast for this Q4. Use year-over-year data where available — seasonal patterns tend to be consistent even if absolute volumes change. Start building seasonal stock well in advance, accounting for supplier lead times and FBA receiving delays that worsen during peak periods.
Using Amazon's Tools
Amazon provides a Restock Inventory tool in Seller Central that suggests reorder quantities and timing based on your sales velocity and lead times. While not perfect, it provides a useful starting point. Configure your lead times accurately in the settings — the tool is only as good as the data you give it.
When Forecasts Go Wrong
No forecast is perfect. Build flexibility into your supply chain — suppliers who can expedite orders, freight options that can speed up delivery, and enough cash reserve to place emergency orders when demand exceeds expectations. Monitor actual sales against your forecast weekly and adjust orders up or down before the gap between predicted and actual becomes a problem.
Forecasting improves with experience and data. Your first forecasts will be rough, but each inventory cycle teaches you about your products' demand patterns and makes the next forecast more accurate.