Log in with GoogleAverage daily demand
Units sold per day, averaged over a period that looks like the coming weeks. For a seasonal product, use the seasonal average, not the yearly one.
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Reorder point calculator
Find the stock level at which to place your next order: the demand you expect while the order is on its way, plus a safety stock for the weeks that go above plan. Enter the safety stock yourself, or derive it from a service level.
Your results
Place an order when your stock, counting units already on order, falls to 380 units.
- Reorder point
- 380
- Average daily demand × lead time + safety stock
- Demand during lead time
- 280
- Average daily demand × lead time
- Safety stock
- 100
- As entered
- Days of cover at the reorder point
- 19
Safety stock derived from a service level, and the reorder point, are rounded up to whole units. The service level method assumes demand is roughly normally distributed and the lead time is fixed.
The start values are illustrative data.
How it works
Both ways to set safety stock, worked through for the start values.
Illustrative data. An example product sells 20 units a day on average and takes 14 days to arrive after ordering.
Safety stock entered
Safety stock is 100 units.
| Step | Calculation | Result |
|---|---|---|
| Demand during lead time | 20 units a day × 14 days | 280 units |
| Safety stock | As entered | 100 units |
| Reorder point | 280 + 100 | 380 units |
| Days of cover | 380 ÷ 20 units a day | 19 |
When stock, counting units already on order, falls to 380 units, place the order. If demand holds, 100 units are still on the shelf when it lands.
Safety stock from a service level
The service level is 95% and the standard deviation of daily demand is 6 units.
| Step | Calculation | Result |
|---|---|---|
| z-score | 95% service level | 1.645 |
| Square root of lead time | √14 days | 3.74 |
| Safety stock | 1.645 × 6 × 3.74 | 36.9 units |
| Rounded up | 36.9 → whole units | 37 units |
| Demand during lead time | 20 units a day × 14 days | 280 units |
| Reorder point | 280 + 37 | 317 units |
| Days of cover | 317 ÷ 20 units a day | 15.9 |
A 95% service level needs 37 units of safety stock here, so the reorder point is 317 units. A higher service level raises it.
What goes in
What goes into the reorder point, and what to compare it with.
Lead time
Days from placing the order to having the stock ready to sell, including production, shipping and goods-in. Use the realistic figure, not the supplier’s best case.
Safety stock
Extra units for demand or delivery above plan. Enter it directly, or derive it from a service level and the standard deviation of daily demand.
Stock position
Compare the reorder point with stock on hand plus units already on order, not stock on hand alone. Otherwise you order again while the first order is on its way.
A reorder point belongs to one product, because demand and lead time differ for each. Inventory Insights projects demand per product and works back from supplier lead time and a safety buffer to a reorder date, and warns you when that product’s reorder window opens.
Reorder point questions, answered.
How do you calculate the reorder point?
Multiply average daily demand by the lead time in days, then add safety stock. With 20 units sold a day, a 14-day lead time and 100 units of safety stock, the reorder point is 20 × 14 + 100 = 380 units.
Does the reorder point include safety stock?
Yes. Without it you reorder just in time, and any late delivery or sales spike causes a stockout. At the start values the demand during the lead time is 280 units and safety stock adds 100 units.
How do I get the safety stock for the formula?
Either choose the number of days of extra cover you want, or derive it from a service level: z × standard deviation of daily demand × √lead time. At 95% (z = 1.645), a standard deviation of 6 units and a 14-day lead time that is 37 units, and the reorder point becomes 317 units.
What is the difference between a reorder point and a reorder date?
A reorder point is a stock level; a reorder date is the day you expect to reach it. Inventory Insights works in dates, per product.
When do I place the order?
When stock on hand plus units already on order falls to the reorder point. At the start values that is 380 units. Recalculate when demand or lead time changes: a level that was right in spring can be wrong by autumn.
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Get a reorder date for every product, not one reorder point for your shop.
Inventory Insights projects demand per product and works back from supplier lead time and a safety buffer to a reorder date, and warns you when that product’s reorder window opens. Stock cover also feeds the labels your campaigns use, so products you cannot deliver lose priority.
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