Every year, mid-market companies invest in better forecasting tools, more sophisticated ERP modules, and the latest planning technologies. The expectation is that performance should improve. But three years of benchmark data from Netstock—covering thousands of companies—tells a different story.
Inventory performance is getting worse, not better. Despite better tools, more data, and increased technology adoption, the metrics that matter are moving in the wrong direction.
The Three-Year Trend
Netstock has published annual benchmark reports since 2024, with the 2025 Supply Chain Planning Report including year-over-year comparisons. The data reveals a consistent pattern of decline.
| Metric | 2023 | 2024 | 2025 | Trend |
|---|---|---|---|---|
| Average Excess Inventory | 37% | 38% | 40%+ | ↑ Worsening |
| Insufficient Forward Planning | — | 56% | 62% | ↑ +6 pts |
| Disciplined Planners ("Ideal") | — | 30% | 22% | ↓ -8 pts |
| Dead Stock >10% of Inventory | — | 12% | 17% | ↑ +5 pts |
Sources: 2023→2024 comparison from Netstock 2024 Benchmark Report; 2024→2025 comparison from Netstock 2025 Supply Chain Planning Report. Data covers 2,400+ companies.
A Counter-Intuitive Finding
This data comes from a period when companies had access to more sophisticated tools than ever before. Technology adoption increased significantly. Yet the results got worse.
More tools didn't translate to better results. The companies that improved weren't the ones adopting the newest technology—they were the ones executing the fundamentals.
Discipline is Declining
Netstock segments companies into four quadrants based on their planning approach. The "Ideal" quadrant represents companies that combine proactive planning with disciplined execution—the gold standard of inventory management.
In 2024, 30% of companies fell into this ideal category. By 2025, that number had dropped to 22%—a 27% decline in just one year.
Where Did They Go?
The data suggests companies are sliding from the "Ideal" quadrant into less disciplined categories—particularly the "Reactive" quadrant, characterized by insufficient forward planning and firefighting behavior.
- ↑62% now report insufficient forward planning (up from 56%)
- ↓Only 22% maintain disciplined, proactive practices (down from 30%)
This isn't a technology failure—it's an execution failure. Companies have the tools to plan forward. They're simply not using them effectively.
Dead Stock is Rising
Perhaps the most alarming trend is the increase in dead stock—inventory that has seen zero movement for extended periods and will likely never sell at full value.
The Dead Stock Math
In 2024, 12% of surveyed companies had dead stock exceeding 10% of their total inventory. By 2025, that figure rose to 17%—a 42% increase in companies with critical dead stock levels.
For a company with $20M in inventory, having 10%+ dead stock means $2M+ tied up in unsellable goods—capital that generates zero return while consuming warehouse space and carrying costs.
Dead stock doesn't accumulate overnight. It's the result of accumulated poor decisions: ordering too much, not tracking slow-movers, failing to liquidate declining products, and continuing to reorder items that aren't selling.
These are exactly the problems that modern inventory software is designed to prevent. Yet the problem is getting worse.
The Root Cause
Why are results getting worse despite better technology? The data points to a fundamental disconnect between tool capability and organizational execution.
- Implementation without integration: Companies buy tools but don't integrate them into daily workflows. The system generates recommendations that no one acts on.
- Configuration neglect: Parameters set during initial implementation remain unchanged for years, even as the business evolves. Safety stocks, reorder points, and forecasting models become stale.
- Skills gap persistence: The same individuals managing day-to-day operations are expected to tune sophisticated planning systems—without dedicated time or specialized training.
- Attention fragmentation: With more tools comes more dashboards, more alerts, and more data. Without clear prioritization, attention scatters and discipline erodes.
The Paradox
Adding more technology without addressing execution gaps can actually make things worse. More tools create more complexity, more data to ignore, and more ways for disciplined practices to slip through the cracks.
What Actually Works
The Netstock data also reveals what separates companies that are improving from those that are declining. The difference isn't technology—it's focused execution on fundamentals.
Regular Parameter Reviews
Top performers review and adjust safety stock, reorder points, and forecasting parameters at least quarterly—not just during annual planning cycles.
Exception-Based Focus
Rather than reviewing all SKUs equally, disciplined companies focus attention on the 20% of items driving 80% of the problem—highest excess, fastest declining, critical service items.
Active Dead Stock Management
Companies maintaining low dead stock levels have formal processes for identifying, escalating, and liquidating slow-moving items before they become unsellable.
Dedicated Analytical Capacity
Whether internal or external, top performers have dedicated resources focused on inventory optimization—not as a side task, but as a primary responsibility.
The Opportunity
The worsening industry trends represent an opportunity for companies willing to invest in execution rather than more technology. While competitors are accumulating dead stock and losing discipline, focused execution on fundamentals can create significant competitive advantage.
The tools are better than ever. The data is more accessible than ever. What's missing is the focused capacity to translate capability into results. Companies that solve this execution gap—through internal investment or external expertise—will pull ahead of an industry that's collectively moving backward.
Sources
Founder, Précis Flux
Industrial executive with a strong background in engineering and applied mathematics, and 20 years of experience across the industrial value chain—from R&D to P&L management. Having worked on inventory optimization and demand variability analysis in his executive roles, Gunnar founded Précis Flux to help mid-market companies release trapped working capital through data-driven methods.