Back to Glossary

Zero Inventory

What Is Zero Inventory?

This is an inventory management strategy used by manufacturers to optimize a supply chain by minimizing inventory entries as much as possible without sacrificing other business objectives, such as responding to consumer orders and shipping requests. Although it’s known as zero inventory, you’ll still find companies keeping some supplies in their inventory.

Zero Inventories Philosophy

The philosophy of zero inventories follows nearly the same principle as just-in-time (JIT manufacturing is when the company has an inventory only when the consumer needs the goods. There is no inventory or supplies when consumers don’t need the products).

Zero inventory management can also extend to collaborations with dropshipping companies, especially when a strong marketing brand is involved in between. Typically, the marketing brand finds customers who want a product, places an order with the manufacturer, and the dropshipping company fulfills the order.

The zero stock approach is ideal for any company that has:

  • Stable market influence;
  • Narrow product range;
  • Dependent suppliers with fast-cycle operations;
  • High volume manufacturing capacity;
  • Consistent, high-quality management.

Zero Inventories Advantages

Just like a JIT approach, zero inventory manufacturing has several business benefits, as opposed to traditional processes. Operational benefits realized by zero inventory companies include:

  • Swift flexibility when reacting to market changes;
  • Streamlined administration work and costs;
  • Optimized production by eliminating waste;
  • Better market forecasting;
  • Optimized supply chains on the need basis.

Zero Stock Examples

As a production and logistics strategy, zero stock minimizes the need or number of SKUs in a fulfillment center in a bid to cut down operational costs. The best zero stock examples include Amazon, Alibaba, and Walmart, all of which are eCommerce retail stores that take consumer orders online and send them to respective manufacturers via an automated inventory management system.

Frequently Asked Questions About Zero Stock

Is it possible to achieve zero inventories? Why or why not?

Well, this is highly unlikely because a business needs to stock some inventories for backup during emergencies or bangled deliveries.

How to achieve zero stock?

You can achieve zero stock by ordering just the right amount of raw materials or wholesale products when there is an active order request in the supply chain.

Is zero stock business model good for my business?

This approach is ideal if your business falls under the zero inventory industry. This can include an eCommerce store, food processing business, print-on-demand services, or even business consultancy.

How to manage zero inventory production?

You can manage zero inventory using the Kanban production technique, which automatically tracks production to order new parts and raw materials. The technique was invented by Taiichi Ohno.

You May Also Like

Why Is PIM Important?
7 min read
Product Information Management

7 Reasons PIM Software Is Needed For eCommerce In 2022

Read about the importance of PIM software for eCommerce businesses and for guaranteeing a smooth customer experience.

Read more
Back To School Sales Tips
9 min read
eCommerce Strategy

TOP 5 Back To School Sales Hacks To Increase Sales

Getting ready for the back to school sales can be difficult, but Gepard PIM's software can really take the stress out of routine work with product content.

Read more
What Are Some Product Fulfillment Hacks?
7 min read
eCommerce Strategy

7 Product Fulfillment Hacks That eCommerce Owners Should Apply In 2022

Explore the best product fulfillment tips for eCommerce store owners to meet customer expectations and grow your business.

Read more
Why Use Multiple Taxonomies?
9 min read
Product Information Management

Employ Multiple Product Taxonomies: The Key To eCommerce Success

Find out how employing multiple taxonomies can boost your team's productivity, help you stay ahead of the competition, and so much more.

Read more
eCommerce Video Marketing
7 min read
eCommerce Strategy

7 Best Examples Of eCommerce Product Video Marketing

Read about the importance and benefits of product video marketing for online sales, and learn the best practices from famous brands.

Read more
Dan Taylor SEO
5 min read
Expert Opinion

Expert Interview: Maximize The Value Of Your PIM Asset For eCommerce Website SEO

How to boost your eCommerce website SEO and enhance your sales and shopping experience with the help of PIM? Read on to find out.

Read more
Can Amazon Sell NFT?
11 min read
Insights / Trends

Amazon NFT: The Future Or Fiction?

Will NFTs change the conventional investment approaches? By discussing the Amazon NFT perspectives, the article explores how NFTs work and how to benefit from them.

Read more
How To Reduce Customer Churn?
7 min read
eCommerce Strategy

How To Reduce Customer Churn And Improve Customer Retention Rate

How do you prevent customer churn and retain more consumers? Learn more about the churn metric and ways of keeping more people in your client base.

Read more
eCommerce Strategies For Uncertainty Times
8 min read
eCommerce Strategy

The Best eCommerce Strategies In Times Of Uncertainty

Learn how your online company can survive in the precarious times of uncertainty by revamping its eCommerce strategies and leveraging specialized software.

Read more

Let’s Get In Touch

Need to contact us? Just use this form

Gepard Privacy Policy