Most brands that hit $300K-$1M in revenue run into the same inventory challenges. These aren’t failures; they’re predictable growing pains. Here’s what to watch for.
Mistake #1: Ordering just-in-time when you should be thinking ahead
What it looks like: Waiting until you’re almost out of stock to place the next PO. Ordering exactly what you need for the next 60 days, nothing more. Operating on a ‘we’ll figure it out when we get there’ basis.
Why it hurts: When you’re reordering reactively, you lose negotiating power with suppliers. No volume discounts. No flexible terms. You’re paying more per unit right when growth should be lowering your costs. Plus, if lead times stretch (and they always do), you risk stockouts during your best sales periods.
How to avoid it: Build a rolling 6-month inventory forecast. It doesn’t have to be perfect—just directionally right. Order ahead when you can, especially before peak seasons. Think about inventory as a strategic asset, not just an operational task.
Mistake #2: Tying up all your cash in one big PO
What it looks like: Spending 70-80% of your available cash on a single inventory order. Having no cushion for marketing, hiring, or unexpected opportunities. Feeling cash-strapped right after placing an order.
Why it hurts: The most expensive inventory decisions aren’t about overordering; they’re about sacrificing growth because all your cash is locked up waiting for products to sell. When opportunities come (a retailer wants a test order, a wholesale lead converts, Amazon recommends you for a promotion), you can’t take advantage because your money is tied up in inventory that won’t sell for 60-90 days.
How to avoid it: Leave at least 30-40% of your working capital available after placing a PO. If you can’t afford to do that and still order the inventory you need, it’s a signal that you should explore external funding options rather than stretching your cash dangerously thin.
Mistake #3: Accepting bad supplier terms because you need product now
What it looks like: Paying 100% upfront because you don’t have negotiating leverage. Accepting longer lead times than you’d prefer. Skipping quality checks or rushing production to save time. Ordering smaller quantities at higher per-unit costs.
Why it hurts: When you’re desperate, suppliers know it. You end up with worse pricing, worse terms, and more risk. And if quality suffers because you rushed, you’ll pay for it in returns, reputation damage, and lost customer trust.
How to avoid it: Build relationships with your suppliers before you’re in crisis mode. Negotiate terms when you’re in a strong position (like right after a successful order), not when you’re scrambling. If you’re consistently in ‘urgent’ mode, that’s a signal your planning or capital structure needs to change.
Mistake #4: Treating all SKUs the same
What it looks like: Reordering everything equally, regardless of sales velocity. Not tracking which products are actually driving profit. Keeping slow-moving inventory in stock ‘just in case.’
Why it hurts: Not all SKUs are created equal. Some move fast, some sit. When you treat them the same, you end up with too much of the slow stuff and not enough of the winners. This ties up cash in dead inventory while your best-sellers stock out.
How to avoid it: Run an ABC analysis:
- A items (top 20% of SKUs that drive 80% of revenue): Always keep these in stock
- B items (steady but not stellar): Order predictably but don’t overstock
- C items (slow movers): Order minimally or consider discontinuing
Mistake #5: Saying no to growth because timing doesn’t line up
What it looks like: Turning down wholesale opportunities because you can’t afford the PO. Passing on promotional placements because inventory won’t arrive in time. Saying ‘maybe next quarter’ to strategic partnerships.
Why it hurts: The opportunities that come at inconvenient times are often the best ones. Retailers don’t wait. Promotional slots don’t stay open. If you’re consistently saying no because of inventory timing or cash constraints, you’re not operating at your full potential.
How to avoid it: Build optionality into your capital structure before you need it. Know what funding sources you’d tap if the right opportunity came up. Don’t wait until you’re desperate. Set up relationships and understand your options in advance.
Mistake #6: Assuming you can bootstrap forever
What it looks like: Pride in ‘never taking on debt.’ Viewing external capital as a weakness, not a tool. Growing slower than you could because you’re waiting for revenue to fund the next order.
Why it hurts: There’s nothing wrong with bootstrapping in the early days. But at a certain point, self-funding becomes self-limiting. Your competitors who have access to capital can move faster, take bigger swings, and capture market share while you’re waiting for cash to free up.
How to avoid it: Recognize that smart founders use capital strategically. Inventory funding, in particular, isn’t debt. It’s aligning your payments to sales performance. The goal isn’t to avoid all external capital; it’s to use the right capital at the right time to accelerate growth without giving up equity or overextending.
See the pattern here?
Here’s what ties all of these mistakes together: They’re reactive decisions made under pressure. The brands that scale cleanly are the ones that think about inventory before it becomes a bottleneck. They plan ahead, build relationships, and understand their capital options before they’re desperate. You don’t need to solve all of this overnight. But recognizing these patterns early means you can make strategic choices instead of scrambling.
Here’s what to do next
If you’re seeing yourself in 2-3 of these scenarios, it’s worth thinking about how your capital structure could give you more flexibility.
If you’re a US brand with trailing 12-month revenue under $200K, you may not be ready for Kickfurther funding YET, but we work with tons of wonderful partners from funding options to fulfillment and everything in between. See if one could be a fit for you! And when the time is right, we’d love to help you add consignment inventory funding to your capital stack.
