Par levels: order the right amount
A par level is the target quantity of an item to have on hand. Set it from usage rate and delivery frequency so you reorder before you run out but don't tie up cash or risk spoilage in over-ordering.
Counting accurately
- Count in a consistent order and unit every time.
- Count high-value and high-variance items weekly.
- Do a full count monthly.
- Use two people for value-critical counts.
Reading variance
Variance is the difference between theoretical usage (what recipes and sales say you should have used) and actual usage (what the count shows left). Persistent variance points to waste, over-portioning, theft or receiving errors.
Cash on the shelf
Carrying less inventory without stocking out frees cash and reduces spoilage — a direct cash-flow win.