A few months ago, we had a late-night call from a client-an emerging fashion brand in California. She had her Shopify store ready, but was stuck on one big question: "How much inventory should I start with?" It's a question we hear more often than you'd think. Too much inventory ties up valuable cash; too little leaves customers empty-handed, disappointed, and unlikely to return.

This dilemma is something almost every ecommerce brand faces when starting out. It feels like walking a tightrope-you want to make sure you have enough stock to fulfill demand but don’t want to lock up funds in unsold products. Over the years of working with fashion, beauty, and home decor brands, we’ve learned that inventory decisions don’t have to be a guessing game. It’s all about applying smart strategies tailored to your product, audience, and budget. Done right, you can set yourself up for scalable success without the financial headaches of overstocking or stockouts.

‍

Why Inventory Planning Matters

Inventory decisions aren’t just numbers on a spreadsheet-they impact every part of your business. Too much inventory leads to unsold stock, higher storage costs, and cash flow problems. Your money gets stuck in products instead of being used to grow your brand. On the flip side, underestimating demand and running out of stock means missed sales opportunities, disappointed customers, and a hit to your brand's reputation.

We saw this in action with a beauty client who launched with over 50 SKUs, believing variety would attract customers. Unfortunately, most of those products moved slowly, draining their cash flow and cluttering their warehouse. After analyzing their sales data, we encouraged them to narrow down to their top-performing items-their hero products. Within months, sales stabilized, stock turnover improved, and operational costs dropped.

Inventory planning is about strategy, not volume. Knowing how much to order and when to reorder can be the difference between thriving and merely surviving.

‍

Key Factors Influencing Inventory

Several factors influence how much inventory you'll need when launching your store. First, consider your product type. Fashion and beauty products are heavily influenced by trends and seasons. Ordering too much out-of-season stock could leave you scrambling to clear inventory. Home decor products may have longer sales cycles but can take up more storage space, impacting costs.

Marketing plans are another crucial factor. Planning a big launch campaign involving influencers, PR, or paid ads? You’ll need to stock more inventory to meet the potential demand spike. On the other hand, if you're testing the waters with a soft launch and organic growth, you can afford to start smaller.

Production and supplier lead times also matter. One client we worked with sourced products locally, allowing them to reorder quickly and reduce upfront inventory investment. Conversely, brands importing products often face long shipping times, customs delays, and higher minimum order quantities, requiring them to stock more from the get-go.

Lastly, your budget will shape how much you can allocate toward inventory. Beyond inventory itself, you need cash to fund marketing, fulfillment, website management, and customer service. Finding the right balance ensures you can cover all these bases without overcommitting.

‍

The MVP Approach

One approach we swear by at Daminico is the MVP (Minimum Viable Product) strategy. Instead of launching with a massive lineup of products, start lean with a core set of hero products. These are the items that define your brand, speak to your target audience, and have the highest chance of driving sales.

For instance, a home decor brand we worked with initially wanted to launch with over 50 SKUs. After a detailed CRO audit, we advised them to narrow their product catalog down to 10 carefully selected best-sellers. This allowed them to focus their marketing budget more effectively and avoid unnecessary inventory costs. They were able to collect real customer feedback, understand demand trends, and gradually expand their inventory based on solid sales data.

Starting lean allows you to test, learn, and adapt without the financial burden of overstocking.

‍

Forecasting Demand Without Sales History

Forecasting demand can feel tricky without historical sales data, but there are several ways to make educated decisions. Start by analyzing your market. Industry reports, competitor analysis, and tools like Google Trends can provide insight into which products are trending, how seasonality affects sales, and what your audience is currently buying.

Additionally, pre-launch strategies can offer valuable clues. Build an email waitlist, run a presale campaign, or offer early access to loyal followers. One beauty brand we worked with launched a presale that resulted in over 2,000 pre-orders, giving them a clear picture of demand before ordering inventory.

Partnering with influencers and beta testers can also help gauge product popularity. Track engagement, collect feedback, and watch which products generate the most excitement. These signals provide a strong foundation for making smarter inventory decisions.

‍

Dropshipping & Print-On-Demand Options

Still unsure about investing heavily in upfront inventory? Dropshipping and print-on-demand models offer lower-risk alternatives. Dropshipping allows you to sell products without stocking them yourself-when a customer places an order, your supplier handles fulfillment. This model minimizes financial risk, but margins tend to be thinner, and you have less control over delivery times and product quality.

Similarly, print-on-demand services are ideal for fashion or home decor brands offering custom designs. We've worked with apparel brands who successfully launched using print-on-demand platforms to validate demand. Once they identified their best-sellers, they transitioned to holding inventory and scaled profitably.

These options give you flexibility while testing the market, allowing you to focus on building brand recognition and customer trust before committing to bulk inventory purchases.

‍

Managing Inventory After Launch

Your launch inventory is only the beginning. Post-launch, it’s crucial to track performance and adjust your strategy. Monitor metrics like sell-through rate (how quickly you're selling inventory), stockouts, and customer feedback. Shopify’s inventory reports and third-party management tools can help you stay on top of stock levels in real time.

Implement reorder points for popular products-setting a minimum threshold to ensure you restock before running out. We had a beauty client who adopted this strategy and reduced stockouts by 50%, leading to improved customer retention.

Conducting regular inventory audits after peak seasons or promotional events also helps you avoid excess stock or scrambling to fulfill orders. Staying proactive allows you to pivot based on actual sales data rather than assumptions.

‍

Real Example: From Overstock to Sell-Out

One fashion brand we worked with launched confidently, ordering 1,000 units of each SKU. They believed aggressive marketing would sell out their inventory fast. But after a few months, they noticed certain products lagging while others flew off the shelves.

We conducted an in-depth audit, identified their top performers, and reallocated marketing resources to focus on those products. Slow-moving items were bundled as upsells, and product pages were optimized for better engagement. Within four months, they cleared excess inventory and adopted a lean, profitable strategy based on customer demand rather than assumptions.

This experience reinforced how data-driven inventory management can turn a potential disaster into a growth opportunity.

‍

Closing lines

So, how much inventory do you need to start an online store? The answer isn’t a magic number-it’s a strategic decision influenced by product type, marketing plans, supplier timelines, and budget.

Start small. Focus on best-sellers. Use pre-launch insights and post-launch data to adjust. Stay agile, test continuously, and let customer behavior guide you.

At Daminico, we’ve guided countless fashion, beauty, and home decor brands through these decisions, helping them strike the perfect balance between inventory efficiency and scalable growth.