Buying

Buying well: order quantities, supplier credit and purchase records for a small shop

How much to order and when, how to compare suppliers on more than the rate, how to keep supplier dues under control, and the simple purchase records that make everything else in the shop work.

15 October 2026 · 8 min read · By Muhammad Ahmad

Also in: اردو · हिन्दी · العربية · Bahasa Indonesia

A shop makes its profit at the counter, but it protects or loses it at the purchase. Buy too much and cash sits on the shelf. Buy too little and customers walk to the next shop. Buy from the wrong supplier and the cheap rate is wiped out by short deliveries and late stock.

Most shopkeepers buy well by instinct for the products they know, and badly for everything else. A few simple habits make buying consistent, even when someone else does the ordering.

Know how fast each product sells

Every buying decision starts from one number: how many of this item you sell in a normal week.

You do not need it for every product. You need it for the ones that matter: your top sellers, your expensive items and anything that expires. For these, find the weekly sales from your till or count it for two weeks by hand.

Then add a second number: lead time, the number of days between placing an order and the stock being on your shelf. For a distributor who visits every Tuesday, the lead time can be up to a week. For a wholesale market trip you make yourself, it might be a day.

Decide when to reorder

With weekly sales and lead time, you can set a reorder level: the stock count at which you should place the next order.

Reorder level = daily sales × lead time in days + a safety cushion

Example: you sell about 6 bottles of a cooking oil per day. Your distributor delivers 4 days after you order. You want two extra days of cushion for busy days or a late delivery.

• Sales during lead time: 6 × 4 = 24
• Cushion: 6 × 2 = 12
• Reorder level: 36 bottles

When stock falls to 36, order. By the time the new stock arrives, you should be down to about 12, never zero.

For slow-moving items, the same logic works with weekly instead of daily sales. If a product sells three a week and the supplier takes a week, reorder when you have about four or five left.

Decide how much to order

How much to order is a balance between two costs: the cost of running out, and the cost of cash sitting on the shelf.

A practical rule for a small shop: order enough to last until the next normal delivery, plus your cushion, and no more — unless there is a good reason.

Good reasons to order more:

• A real price increase has been announced and the product sells fast enough to clear before you would need the cash.
• Season or festival demand is coming (see planning for Ramadan and Eid).
• The supplier only visits rarely.

Weak reasons to order more:

• The sales representative is persuasive.
• There is a small scheme discount on a slow mover.
• "It might run out somewhere."

Before accepting a bulk deal, do the arithmetic. Suppose a distributor offers 5% off if you take 20 cartons instead of your usual 5. If 20 cartons take four months to sell, you have tied up four times the cash for four months to save 5%. If that cash would otherwise have gone into fast movers that turn over every week, the discount was probably a loss.

Compare suppliers on more than the rate

The cheapest rate on paper is not always the cheapest supplier. When you compare, look at the whole picture:

Keep at least two sources for your most important products. One reliable main supplier, and a second you buy from occasionally so the relationship exists if the first lets you down.

Once a quarter, check the rates you pay for your top 15 products against at least one other source. Not to switch every time, but so you know when your main supplier has drifted upwards.

Check every delivery before you sign

Most purchasing losses happen at the moment of receiving, and most of them are not dishonest. They are a carton left on the truck, a wrong flavour, a rate on the bill that differs from what was agreed.

When stock arrives:

1. Count cartons against the bill.
2. Open any carton that is not sealed and count it.
3. Check sizes and variants match what you ordered.
4. Check dates on perishables.
5. Check the rate on the bill against the agreed rate.
6. Write any difference on the bill and have the delivery person sign it.
7. Enter the delivery into your records the same day.

That last step does three things at once: your stock is correct, your cost prices are updated, and your supplier ledger shows what you owe. If cost prices change, update your selling prices too, as described in how to price products.

Keep a supplier ledger

For every supplier you buy from on credit, keep a running record:

Keep a copy of every bill and get a written receipt for every payment, even cash. When the supplier's representative says you owe Rs 18,200 and your record says Rs 15,600, the ledger and the signed return note are what settle it in a minute instead of an argument.

At least once a month, ask the supplier for their statement and compare it with yours line by line. Differences found monthly are easy to resolve. Differences found after a year are often never resolved.

Pay supplier dues on time, and on a plan

Supplier credit is useful. It lets you sell the goods before you pay for them. But it only works if you treat the due date as real.

• Know what is due this week. Every Monday, list the supplier payments due in the next seven days and the cash you expect to have.
• Pay on the agreed date, not before and not after. Paying early gives away the benefit of credit. Paying late damages the relationship and may cost you your terms.
• Pay the oldest bill first unless agreed otherwise.
• If you cannot pay, say so before the date, with a realistic plan. Suppliers deal with this regularly; what they cannot deal with is silence.

If you are often short of cash on supplier day, look at why a profitable shop runs out of cash. The usual answer is that your customers pay you more slowly than you pay your suppliers.

A note on terms: agree the price and the payment date when you buy, and keep both fixed. The amount you owe should be the amount on the bill, whether you pay on day one or on the agreed day. Do not accept terms where the amount grows if you pay later; if you need more time, ask for a later date at the same price, before the due date arrives.

Use a simple order list

Before every order, walk through your reorder list rather than walking the shelves and guessing. A written list, organised by supplier, prevents the classic mistake of noticing an empty shelf the day after the distributor visited.

The list for each supplier can be as simple as:

• Product, current stock, reorder level, quantity to order.

Send the order in writing (a WhatsApp message is fine) so there is a record of what you asked for. When the delivery arrives, compare it with the message as well as the bill.

Saleva's Reorder screen builds this list from your minimum stock levels and can send it to the supplier on WhatsApp, and receiving the stock against a purchase updates both stock and the supplier's balance. The products and stock guide shows how.

Questions shopkeepers ask

Should I buy from the wholesale market or wait for distributors?

Both have a place. Distributors bring stock to you and often offer credit, but at their rates and their schedule. The wholesale market can be cheaper for some items and lets you choose, but costs you time and transport. Many shops use distributors for branded goods and the market for loose goods and top-ups.

How do I know if a scheme is really worth it?

Work out the discount as a percentage (for example, 12 + 1 free is about 7.7% off), then ask how long the extra stock will take to sell. If it will sell within your normal ordering cycle, it is usually worth it. If it will sit for months, it usually is not.

A supplier wants cash on delivery only. Should I accept?

If the rate and reliability are good and it is a fast-moving product, yes. Just plan for it: cash-on-delivery suppliers need to be in your weekly cash plan, because the money leaves the moment the goods arrive.

How many days of stock should I keep?

For fast movers with reliable suppliers, enough to last until the next delivery plus a couple of days. For slow movers, as little as you can without disappointing customers. For anything perishable, less than its shelf life with a margin to spare.

Do I need to keep purchase bills?

Yes, for your own records and for any dispute with a supplier. For how long, and whether you need them for tax, check with your own accountant.

Keep reading

CustomersAdvance orders and deposits: taking them without losing trackCustomersHome delivery for a neighbourhood shop: taking orders, sending riders and collecting the moneyBillingRunning a small restaurant counter: tables, kitchen orders and the evening total