How Can Supply Chain Analytics Help in Preventing Wastage/Stockouts?

How Can Supply Chain Analytics Help in Preventing Wastage/Stockouts

Modern supply chains generate a tonne of big data as a result of their broad reach and intricate structure, which may be analysed to comprehend patterns, spot inefficiencies, and come up with creative solutions. 

A supply chain analytics course focuses on employing data analytics approaches and technologies to boost the effectiveness of supply chain management and operations. Supply chain analytics involves the analysis of data that businesses extract from a variety of supply chain-related applications, such as executing supply chain methods for sourcing, stock control, handling orders, storage management and fulfilment, and transportation oversight. 

What is the Cause of Wastage or Stockouts?

Here are the few major causes of wastage or stockouts:-

Faulty predictions

Stockouts or overstocks are almost a guarantee when projections are inaccurate. Inefficient demand forecasting can lead to overproduction, a typical source of wasted materials in supply chains. Inadequate inventory management can cause inadequate supply levels to satisfy demand, which can result in stockouts. To reduce stockouts, shortages, and overstocks to a minimum, an effectively carried-out forecasting system is required. 

Incorrect records

Due to inaccurate inventory counts, instances of stockouts or wastage could happen. This mostly occurs due to a human’s fault as they make an error either while counting, entering the data manually or misplacing some product while unloading. 


Stockouts can occur at any step in the supply chain, for example, if there are problems obtaining raw materials or providing manufacturers with parts. They may also be brought on by problems with production, such as a lack of labour, broken equipment, inadequate planning, or the arrival of a natural disaster.

Damaged products

Sometimes due to mishandling, poor quality of product or storage condition, the product can be damaged. Companies can find areas where changes can be made to lower the risk of waste due to expired or damaged items by employing analytics to monitor quality control, storage conditions, and transportation procedures.

supply chain management courses

Need for Supply Chain Analyst

Supply chain analytics combines data and analytical techniques to enhance supply chain efficiency, cut down on waste, and avoid stockouts. There is a vast quantity of information generated by the numerous actions, individuals, and organisations that make up supply chains. Supply chain analytics can transform this enormous volume of data into easily comprehensible dashboards, reports, and visualisations that have an impact on important choices and provide improved outcomes. Continue reading to find out how supply chain analytics can help you with your business

Demand forecasting

To avoid stockouts and satisfy client demands, it is essential to recognise and prioritise your top-performing goods. Analysing sales and inventory patterns will help pinpoint the most well-liked items that are in great demand. To provide more precise demand estimates, supply chain analytics may be utilised to find patterns and trends in previous sales data. Making judgments regarding which items to create more of and which ones might not be worthwhile to carry in the future will be made easier with the aid of this knowledge. 

Optimal inventory

Based on elements like time to place the order, demand variability, and order frequency, supply chain analytics may assist in determining the ideal inventory levels for each product. By monitoring these indicators, you can keep track of how your items are selling at the retail level and make sure there is always a consistent supply of goods accessible to customers. This would help in thorough sales and operations planning. 

Automate Procedure

Stockouts and other inventory problems may be significantly influenced by mistakes made by employees in warehouse operations. Inventory levels are automatically updated in real-time using an Inventory management solution (IMS). Whenever an item is received at a manufacturing facility or distribution centre, they immediately update inventory levels. Once more, real-time updates to inventory counts are made when sales are about to run out of stock. IMS should be capable of doing inventory management functions including determining reorder points, providing reminders, and creating reports that can aid forecasting and demand planning.

Evaluate suppliers 

Through Supply Chain analytics, the company can identify and evaluate their supplier's performance or take a lead in finding any potential issue and addressing it. It is also important to hold a good relationship with the suppliers and collaborate effectively, for the overall betterment of the company. For instance, early notification of impending shortages by a supplier might offer a firm time to find alternatives rather than having to rush at the last minute.

Apply location-based analysis to all of your goods

Location-based analysis can help in a more efficient arrangement of items and more increase in sales. By spotting trends or patterns in consumer behaviour in particular geographic locations, we can gain a better insight into the consumer taste, trends and demands of particular items to predict future sales. Analytics may also be used to find ways to reduce costs and increase sustainability, including combining shipments or employing more effective modes of transportation.


Supply chain analytics is the practice of using data and analytical techniques to enhance the performance of the supply chain. Supply chain analytics can assist in locating opportunities to optimise inventory levels, increase the accuracy of demand forecasting, monitor quality control, assess supplier performance, optimise transportation routes, and provide real-time data visualisation and reporting in the context of preventing waste and stockouts. 

Organisations may decrease waste, boost customer happiness, and boost profitability by using data-driven insights. Supply chain analytics has developed into a crucial tool for companies wanting to optimise their operations and stay competitive in today's fast-paced market with the use of cutting-edge technology and analytical approaches.

Consequently, as supply chains get more complicated, so grows the requirement for data specialists who can make sure the system functions without an issue. Thus, the job of Supply chain analytics is high in demand as people start to realise its importance. If you want to upskill yourself and take a Supply chain Analytics course in this competitive world, Imarticus is providing a professional IIT Supply chain management certification Course.  Enrol yourself now.

Share This Post

Subscribe To Our Newsletter

Get updates and learn from the best

More To Explore

Our Programs

Do You Want To Boost Your Career?

drop us a message and keep in touch