There’s a lot of different ways to handle inventory, and many of them can change depending on your chosen industry and how you distribute products to customers.

Customers, however, can often serve as the best way to determine your best inventory priorities going forward. If your business deals in selling products directly to consumers without a retail distribution network to contend with, your inventory will largely be dictated by the whims of your customers and their ever-changing needs.

But how can you get out in front of that? What can you do to prevent your warehouse from getting caught short-handed by customer demand and better able to keep up with market trends? By setting proper inventory priority, you can better understand what needs to be done to maintain a strong inventory and remain a viable option in the minds of your customers:

Assess carrying costs carefully

One of the biggest sources of inventory management tension comes from the rise in carrying costs. ‘Carrying costs’ refer to any of the financial burdens associated with stocking goods—even above and beyond the cost of the products themselves, you need to factor in transportation time, the labor impact of stocking and picking these goods, and even the cost of the warehouse shelving used to store these items. Understanding how to assess carrying costs will help you make better decisions on what you need to reorder and what you can’t afford to keep carrying.

Closely monitor customer demand

A lot of warehouse managers still believe that all items should be kept at a minimum level, but in many cases this can prove detrimental to your stock levels if an item proves to be more—or less—popular than expected. If an item seems to be moving more steadily than usual, keeping your inventory at a ‘best case’ level can give you a leg up on the competition that seems to be running out of a certain item too quickly to keep up with customer demand. This will require a degree of foresight, as you’ll need to carefully monitor item demand and consistent stock levels over a period of time, but it can help in the long run.

Reduce lead times where possible

Similarly, being able to get more of a popular item when you start to run low more quickly than the competition can go a long way to set you apart. Even if your safety stock begins to run low, you can mitigate these losses by being proactive in all areas of your shipping and processing. Work with your vendors to establish a fast reorder process where able, and keep an eye on the stock levels of any more popular items to know when exactly you have to reorder. Even if you run out of stock temporarily, keeping these items around (and getting them back faster) will do a lot to help maintain customer satisfaction and loyalty.