6.4 – Carryover and Inventory Management
The inability to manage inventory is the number one reason for the failure of a seed business.
This is true no matter if the business is mission driven, livelihood driven, conventional, organic or whether the seed business is a government entity or private sector business. Cash flow is tied up in inventory, so if the correct balance is not met, inventory may cost a business too much money.
Growers face a variety of decisions each season, with fluctuating costs of agricultural inputs being a major hurdle.
Growers may consider purchasing seed in advance for use in subsequent planting seasons. Prices for seed and other agricultural inputs fluctuate depending on a variety of national and global factors, so purchasing seed in advance allows the grower to have a defined and locked-in price. Although this decision may benefit the grower financially, an additional risk is presented due to the risk of seed quality degradation and contamination.
Excess inventory may also cause the need to carry over seed, which can be caused by many factors:
What Information is Necessary to Make Inventory Decisions?
Best Practices for Seed Inventory and Carryover Seed Management:
Click through each of these important strategies for maintaining seed inventory.
Review
Work through these interactive questions to review the important concepts discussed.
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The total quantity of seeds available for use, sale, or distribution at a given time.