One of the biggest challenges for handmade businesses is knowing what to make, how much to make, and when to make it. Produce too little, and you miss sales. Produce too much, and you're left with shelves full of inventory after the holidays.
Good inventory planning is about having the right product, in the right quantity, at the right place, at the right time.
The best place to start is by looking at your own sales history. Think back to last year's holiday season—or, if your business is newer, your most recent markets or online sales.
Ask yourself:
Which products sold out first?
Which products sold consistently throughout the season?
Which products were slow to sell?
Which price points were most popular?
Did customers ask for colors, sizes, or variations you didn't have available?
These patterns can help you predict what customers are likely to buy this year.
Seasonality also plays an important role. Products that sell well in the summer may not be your best holiday sellers, while giftable items, ornaments, winter décor, cozy accessories, and stocking stuffers often see increased demand. Think about how your product mix should shift as the seasons change instead of producing the same assortment year-round.
Inventory planning goes beyond finished products. Every item you sell starts with raw materials, packaging, and supplies. As you build your production plan, consider everything you'll need to complete an order:
Raw materials and components
Packaging, gift boxes, tissue paper, and stickers
Business cards and thank-you notes
Shipping supplies and labels
Display inventory for upcoming markets
Some materials can take weeks to arrive, especially during the holidays when suppliers are busy. Ordering those supplies early helps prevent delays that could impact your ability to fulfill orders or prepare for events. By planning ahead, you might even snag some Labor Day promotions and reduce the cost of your finished product by purchasing supplies on sale.
Finally, think about where you'll be selling. Online shops, wholesale orders, and in-person markets all require inventory, and each channel may have different customer preferences. Planning ahead helps ensure your best-selling products are available wherever your customers are shopping.
The goal isn't to make more inventory. It's to make the right inventory, supported by the supplies you need to deliver a great customer experience.
As your business grows, even a simple spreadsheet can become one of your most valuable planning tools. Tracking sales, inventory levels, and customer requests will make each holiday season easier than the last.
For a more comprehensive overview on inventory planning, Handmade DFW offers classes throughout the year. Sign up for email to be notified of upcoming classes.
Next up: We'll look at your product lineup and discuss how to know when it's time to retire a product.