Reorder Point Calculator

The reorder point (ROP) is the stock level that triggers your next purchase order. Set it right and the new shipment arrives just as you're about to run out; set it wrong and you either stock out (costing sales) or carry excess inventory (costing cash).

Two formulas, one shape

Basic and advanced modes share the lead-time stock term; they differ only in how safety stock is computed:

Basic: ROP = D̄ × L + D̄ × S_days | Advanced: ROP = D̄ × L + Z × σ × √L

Worked example

Average demand 20 units/day, lead time 7 days, safety buffer 5 days:

1. Lead-time stock = 20 × 7 = 140 units
2. Safety stock = 20 × 5 = 100 units
3. Reorder point = 140 + 100 = 240 units
4. Place the next PO when inventory falls to 240
5. Advanced (σ=5, 95% service): safety = 1.65 × 5 × √7 ≈ 22 → ROP 162

Practical tips

• Measure lead time from actual purchase orders, not from the supplier's promise: the gap between the two is the safety stock you need.
• Imported supply adds time the supplier does not control — freight, customs clearance and seasonal port peaks — so measure from order date to the date the item enters your warehouse, not to port arrival.
• Recalculate at least quarterly: usage and lead time both drift, and a point calculated once goes stale silently.
• Imported and locally sourced items should not share one reorder point even when usage matches — lead time is the governing variable, not usage.