Our wooden coaster blanks come with a minimum order of 1,000. We sell about 150 a month. For years I treated that number like weather. The supplier said 1,000, so I ordered 1,000, and I spent a few days after each order feeling slightly ill about the cash.
Last March I finally ran the math. It didn't say what I expected, and it changed what I do on every minimum order quantity (MOQ) since.
What a minimum actually sells you
Start with months of cover. That is what an MOQ really puts on your purchase order.
Months of cover = MOQ ÷ average monthly demand
1,000 ÷ 150 = 6.7 months. Every reorder from that supplier commits me to nearly seven months of one SKU, in one finish, before a single coaster is engraved.
My other option was a second supplier with a 300-unit minimum. Their price is $1.18 a blank against $0.92 from the main one, so 28% more. Over the same 6.7 months of demand, buying small costs $1,180 and buying the full lot costs $920. The premium for staying small is $260.
The carrying-cost argument is mostly wrong
The standard objection to a big MOQ is that you tie up cash and pay to store it. True, but people rarely put a number on it, so here is mine. I charge 25% a year to hold stock. On a $0.92 blank that is about 2 cents per unit per month. A unit from a 1,000 lot waits, on average, half the cover period, which is about 3.3 months. So holding the big lot costs me around $64 in total.
$260 saved, $64 spent holding. The big lot wins by roughly $200.
Run it the other way and you get the break-even. The $0.26 per-unit price gap only gets eaten by holding cost once the MOQ covers around 27 months of demand. Almost no MOQ is that bad.
On pure interest math, buying the minimum nearly always wins. Stop using carrying cost as your reason to fight one. The things that hurt are different.
The two things that actually hurt
Obsolescence. A blank is cheap until you stop selling the finish. We dropped a walnut stain after about a year, with several hundred units left on the shelf, and I cleared them at a craft fair for less than I paid. Nothing in a carrying-cost formula captures a product you've decided you don't want.
Cash timing. 1,000 coaster blanks is $920. That is nothing in February and a real decision in September, when every supplier wants payment ahead of Christmas stock and the bank balance has a job for every dollar.
Both depend on how long the minimum has to last. Which brings it back to months of cover.
A rule I use now
Under six months of cover, buy the minimum and stop thinking about it.
Between six and twelve, buy it if the SKU is a staple and you aren't cash-tight. A product with a three-year run is fine. A seasonal finish is not.
Past twelve months, don't order yet. Ask the supplier a question first.
Ask
I had never asked. The minimum was printed on a price list and I read it as a rule.
In March I emailed the main supplier: could they do 500? They answered within the hour. Yes, at $0.97, which is 5% more per unit. That moved me from 6.7 months of cover to 3.3, and from $920 out the door to $485. The price of that flexibility is $25 a lot.
Keep the email short. Name the SKU, say what you'd actually use in a year, and ask what the price looks like at half the minimum. Don't open with a complaint. They've heard it from everyone, and the buyer who writes two lines gets answered first.
Suppliers set an MOQ where a production run or a carton count breaks even for them. Many keep a second price for people who ask, and the ask costs you one email. Some suppliers say no. The ones who say yes usually want a few percent more per unit for half the quantity, and that is usually a fair trade.
Where Stocura fits
The Stocura reorder queue suggests a quantity per SKU, and the "How calculated" tooltip on that figure tells you when the supplier's MOQ set the number rather than demand. That is your cue. A queue row that wanted 320 and shows 1,000 is a row where you should be doing the cover math.
If a SKU has a secondary supplier, Stocura puts both in front of you when you place the order, so the 300-unit option is on screen when you're deciding. Whatever quantity you type goes through to Cin7 Core as typed. If it falls below the recorded MOQ, you get an amber warning and the order still goes. Suppliers sell under their minimum more often than the price list admits, and the system shouldn't overrule a deal you've negotiated.
This week
Export your ten largest MOQs by dollar value. Divide each by monthly demand. Anything over twelve months of cover, email that supplier today and ask for half.
Order quantities you can check
Stocura sits on top of Cin7 Core and shows the arithmetic behind every suggested order quantity, including when a supplier minimum set the number. Free during beta.
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