The Theory of Constraints (TOC) analyzes the impact of supply together with the demand over the management of the supply chain stocks, with an emphasis on the supply side. If it is possible to respond in an instant to demand, there is no need to rely on forecast at all! While this situation is of course unattainable in almost all business environments, a step in this direction should be considered. In the case of keeping the right amount of stock in the supply chain, the objective is having very good availability of the items at all the consumption points. This objective is limited by the availability of cash and space, which means that it's impossible to keep high stocks of all items at all locations, even when obsolescence is not an issue. No only that, but also as will be explained later in this article, keeping too high stocks of low demand SKUs will lower the sales overall.