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DATUM FIELD CHAPTER · INVENTORY

Discipline: Inventory

Ten canonical operational blueprints cataloged under the Inventory field domain.

#011
Inventory Analytics

We have too much inventory

Which policies are causing stock to accumulate?

#011 Cycle Stock Sawtooth7 Orders / Yr
AVG STOCK: 171u
High Cadence = Low CapitalEOQ Tradeoff
Average Inventory:171 units
Tied Capital:$14535k
Few Large OrdersFrequent Small Batches
Verified ProofBlueprint→
#012
Safety Stock Optimization

We keep running out of stock

Why does stock hit zero before replenishment arrives?

#012 Buffer Sensitivity67% Service Fill
Buffer: 60u
⚠ 2 Stockout PeriodsLead Time: 12d
SAFETY BUFFER:+15 units
TOTAL STOCK:60 units
💡Averages feel safe, but variance triggers out-of-stock events.
Blueprint→
#013
Safety Stock Models

Safety stock is based on guesswork

How much buffer should we hold for uncertainty?

#013 Normal Distribution (Z-Score)Z = 1.645 (SL 95%)
Lead Time: 9d · Std Dev: 14u69 Units Buffer
SAFETY STOCK:69 units
HOLDING COST:$290 / mo
💡Exponential buffer curves near 99% service limits.
Blueprint→
#014
Inventory Analytics

Slow-moving inventory keeps accumulating

Which stock is quietly aging?

#014 Aging Buckets30% >90 Days
0-30d31-90d90d+
Dead Stock Risk$426k at Risk
Fresh Stock (<30d):40% Healthy
Aging Burden:30% Slow
Healthy RotationSevere Aging
Verified ProofBlueprint→
#015
SKU Classification

We don't know which SKUs deserve attention

Which products matter most and which are unpredictable?

#015 9-Box SKU MatrixTier: AX
140 SKUs · 48% RevenueInventory Rule

Automated JIT / Low Buffer

💡Segment items to focus inventory capital.
Blueprint→
#016
Inventory Analytics

Inventory is sitting in the wrong locations

Where should available stock be placed?

#016 Square Root Law5 Warehouses
HUB
Formula: SS_total = √N × SS_hub2.24× Total Stock
Node Count (N):5 DCs
Inventory Penalty:+124% Stock
1 Central Hub8 Regional Nodes
Verified ProofBlueprint→
#017
Inventory Analytics

Reorder quantities are inconsistent

When should we reorder and how much?

#017 EOQ Optimal Order663 Units EOQ
MIN COST EOQ
Setup: $110/orderMin Total Cost
Optimal Batch:663 units
Orders / Year:15.1 runs
Low Setup ($20)High Setup ($200)
Verified ProofBlueprint→
#018
Inventory Analytics

Supplier MOQs create excess stock

What happens when the supplier minimum is larger than what we need?

#018 Supplier MOQ Step600 Unit MOQ
NEED: 350+250
Holding Burden1.7 Months Stock
Forced Surplus:+250 units
Carrying Penalty:+$3000 / yr
200 MOQ1,000 MOQ
Verified ProofBlueprint→
#019
Inventory Analytics

Working capital is locked in inventory

How much cash is sitting on shelves?

#019 Carrying Cost16% WACC
$500k Inventory Base$80k / yr Cost
Capital Cost Rate:16%
Annual Bleed:$80k
8% Low WACC24% High WACC
Verified ProofBlueprint→