INTERNATIONAL POLICY DIGEST

Slow inventory turns are a problem for distributors. Luckily, there are solutions.

Inventory isn’t just stuff in a warehouse – it’s working capital. It’s money tied up, space occupied, and opportunity delayed. For many B2B distributors and wholesale brands, slow inventory turns quietly erode profitability behind the scenes.

One primary reason behind this hidden drain is outdated or overly complex systems that fail to deliver real-time insights. Modern distribution management software like SimplyDepo empowers teams with better visibility, faster execution, and smarter inventory decisions from day one.

A product that doesn’t move is more than an inconvenience. It blocks cash flow, raises storage costs, and leads to missed chances when you can’t quickly respond to market shifts. This issue is especially pressing in the post-pandemic era, where flexibility and speed are the new currency of success.

The good news? Forward-looking distributors are solving slow turnover with more intelligent systems. This article breaks down the real costs of slow-moving stock, what causes it, and how digital solutions like SimplyDepo help distributors turn things around – fast.

Firstly, what are inventory turns, and why do they matter? Let’s start with the basics.

Inventory turnover is a ratio that shows how often a company sells and replaces its stock over a given period. It’s calculated as: Inventory turnover = cost of goods sold/average inventory.

The higher the turnover, the more efficiently you manage inventory. A low turnover rate suggests that products are sitting too long, consuming space, money, and time.

What qualifies as “good” depends on the sector:

Fast-moving consumer goods (FMCG): 10–15 turns/year
Food & beverage distributors: 15–25 turns/year
Consumer electronics: 6–8 turns/year
Automotive parts & accessories: 3–5 turns/year
Industrial supplies: 4–7 turns/year

Lower-than-average turnover should be a red flag. Even if sales are consistent, slow-moving inventory reduces your responsiveness and adds friction across the supply chain.

1. The True Cost of Slow Inventory Turns

Sluggish inventory isn’t just a warehouse problem—it’s a financial one. Here’s how slow inventory turnover quietly bleeds profit from B2B distributors.

Storing goods costs more than just shelf space. You’re paying for:

Warehouse rent or depreciation
Insurance and taxes
Staff to move, count, and manage inventory
Utilities, security, and systems upkeep

When inventory moves slowly, these fixed costs inflate your cost of goods sold (COGS), undermining your gross margin.

2. Risk of Obsolescence and Shrinkage

Products can lose value while sitting idle. This is especially true for:

Electronics and tech
Seasonal goods
Consumables with expiration dates
Parts with updated SKUs or compatibility changes

Unsold inventory often ends up deeply discounted or written off entirely.

3. Lost Sales and Missed Opportunities

Distributors stuck with the wrong stock cannot accommodate what customers want. Meanwhile, competitors who can quickly respond to demand are winning the sale.

Even more damaging, stockouts caused by over-ordering on one product and underordering others mean missed revenue and lower customer trust.

4. Reduced Agility and Responsiveness

Market conditions change rapidly—especially in wholesale and B2B sectors. Economic shifts, supplier issues, or product launches can all demand quick pivots. But when inventory is slow-moving, you’re locked into the past.

According to Gartner, companies with high inventory agility outperform peers by 20% in responsiveness metrics. McKinsey reports that improving inventory visibility and turnover can reduce total inventory costs by 20–30%.

5. Why Slow Inventory Turns Happen

Understanding the problem helps you fix it. Here are the most common causes behind poor inventory performance in distribution.

When warehouse, field sales, and purchasing teams operate in silos, no one has a full view of what’s actually in stock. When data is consolidated, it’s outdated—and you’ve either ordered too much or insufficient.

Forecasts are often wrong without accurate, real-time sales feedback—especially from field teams. Many distributors still rely on gut instinct or Excel-based models, which don’t quickly adapt to market changes.

Fear of stockouts leads to excess ordering. While understandable, this practice creates a bloated inventory and ties up cash that could be used for marketing, hiring, or new product lines.

Too many businesses still track inventory using spreadsheets or juggle multiple software systems that don’t communicate. This creates errors, delays, and misalignment between sales, ops, and warehouse teams.

How Leading Distributors Are Turning the Tide

Top-performing distributors are doing more than tweaking reorder points—they’re rethinking how inventory is managed from the ground up. Real-time inventory systems allow businesses to instantly view stock levels, incoming shipments, and order status across multiple warehouses and mobile field teams. This improves decision-making at every level: purchasing, replenishment, route planning, and customer service.

Integrating Mobile Field Sales Tools

Field reps aren’t just order takers—they’re your eyes on the ground. Modern tools let sales teams instantly capture customer demand and stock feedback, which feeds back into central forecasting systems.

Centralizing Inventory Across Channels

Whether you’re managing multiple warehouses, vehicles, or distributors, consolidating inventory data into one system provides clarity and control. It prevents overstocking in one area while another runs dry.

Automating Replenishment and Alerts

Instead of manually checking what’s low, distributors now use automated alerts and reorder thresholds. That means less firefighting and fewer missed opportunities.

Shortening Replenishment Cycles

Faster restocking = less need to hold months of safety stock. With better planning and faster execution, distributors can reduce days of inventory on hand (DOH) and free up working capital.

SimplyDepo in Action: Inventory Velocity Without the Complexity

SimplyDepo helps distributors replace slow, manual workflows with fast, flexible inventory visibility. SimplyDepo’s platform is purpose-built for B2B distribution teams that want performance without the headaches of legacy ERP systems.

Key Inventory Optimization Features

Real-time stock levels across all sales and warehouse locations
Low-stock alerts and automated reorder triggers
Mobile-first access for sales reps and field merchandisers
Route optimization to reduce missed deliveries and stockouts
Order syncing from mobile to warehouse in seconds

SimplyDepo’s tools are built for wholesale distributors who need agility and control—from the factory to the shelf.

What Better Inventory Turns Look Like in Practice

Let’s break it down with a real example.

A mid-sized distributor operating across three regions used SimplyDepo to streamline their inventory strategy.

Before: Average turnover: 4.8x/year; 22% of warehouse space used by aging or slow-moving items; Field sales reps sent orders via email, often leading to double-handling

After implementing SimplyDepo, Inventory turnover increased to 7.1x/year within six months, inventory carrying costs dropped by 30%, and out-of-stock incidents were reduced by 40%. Warehouse teams received real-time order sync, cutting fulfillment errors by 25%. Sales teams placed orders via mobile app in minutes, with automatic stock check.

The result? Faster order-to-cash cycles, higher customer satisfaction, and better margins.

If you’re facing tight margins, stockouts, or growing warehouse costs, your inventory turnover is likely contributing to the problem.

But you don’t need to overhaul your entire supply chain to see results. With the right technology, better processes, and more visibility, your inventory can become a growth engine—not a liability.

See how smarter inventory management can reduce costs and boost flexibility—without adding complexity.

Book a demo and explore SimplyDepo to see how fast-moving inventory builds stronger, more profitable distribution businesses.