Make volume purchases for lower prices, but don't end up with slow moving inventory. Have plenty of inventory on hand, but don't get stuck with obsolete items. You will also reap benefits in having good relationships with your vendors. If you have sufficient access to vendors who can supply your needs quickly, you may not need a large inventory on hand. Also, be sure to have a backup vendor for emergencies.
Many industries rely on a ratio which measures inventory turnover rate.
Inventory Turnover Rate can be calculated in various ways, providing a rough guideline by which managers can set goals and measure performance.