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Reorder point

Keep the unit of measure and day basis consistent. Choose a manual buffer or a variability estimate using your own observations.

Local calculation · no sign-up

Your inputs

Illustrative inputs
Your chosen buffer.
Review expected arrival dates and overdue supply.

REVIEW THE ASSUMPTIONS

Inventory position is at or below the threshold.

Expected demand during lead time
96 units
Safety stock
30 units
Reorder threshold
126 units
Inventory position
97 units
Position minus threshold
-29 units
  • Demand and lead time both use operating days. Inventory is measured in the same units as demand.
  • Inventory position = usable stock + open orders − commitments/backorders. Count only usable open orders and examine their arrival dates; do not double-count commitments already reflected in demand.
  • Safety stock is the buffer you entered. It does not estimate variability or a guaranteed service level.
  • The threshold is not an order quantity. Check overdue orders, pack sizes, minimum quantities, seasonality and supplier constraints before replenishing. No purchase is created.

The formula

Reorder point = average daily demand × average lead time + safety stock. Inventory position = usable on-hand units + usable open-order units − commitments/backorders. Optional safety stock = z × √(lead days × daily-demand SD² + daily demand² × lead-time SD²).

Reorder point and safety stock explained

Example PNGIllustrative inputs. Threshold is not an order quantity.