What is Capacity Planning?

Capacity planning is the strategic process of assessing your current operational capacity and projecting future needs based on demand forecasts, growth targets, and seasonal patterns. It encompasses warehouse space, staffing levels, equipment availability, and system throughput. The goal is to ensure you have sufficient capacity to meet demand without excessive overcapacity that wastes resources.

Why It Matters

Under-capacity during peak periods leads to fulfillment delays, SLA violations, and lost sales. Over-capacity during slow periods wastes money on idle labor, unused warehouse space, and underutilized equipment. Good capacity planning smooths out these extremes by anticipating demand changes and adjusting resources proactively rather than reactively.

How It Works

• Current State Assessment: Measure your current capacity: orders per day you can process, warehouse utilization, staffing levels, and equipment availability.
• Demand Forecasting: Project future order volumes based on historical trends, growth rates, promotional calendars, and seasonal patterns.
• Gap Analysis: Compare projected demand against current capacity. Identify when and where capacity will fall short of demand.
• Action Planning: Close the gap through hiring, temporary staffing, warehouse expansion, equipment investment, shift scheduling, or outsourcing to 3PLs.
• Monitoring: Continuously track actual demand versus planned capacity and adjust as forecasts are revised.

How Nventory Helps

Nventory provides capacity planning insights by combining order volume trends with fulfillment throughput metrics. The system projects when your current capacity will be exceeded based on growth trends and seasonal patterns, giving you advance notice to hire, expand, or outsource before bottlenecks impact customer experience.