Reorder point calculator
The reorder point is the stock level that tells you to place the next order: daily demand × lead time in days, plus safety stock. Order when stock on hand plus stock on order falls to it, and the new delivery lands before you run out.
760units
Reorder when stock on hand plus stock on order reaches this level.
That is 560 units of lead-time demand plus 200 units of safety stock. Each order lasts about 30 days.
How the reorder point works
- Work out average daily demand for the SKU across all your sales channels.
- Multiply it by the lead time in days, from purchase order to units ready to sell.
- Add safety stock to cover demand spikes and late deliveries.
- Reorder whenever stock on hand plus stock already on order falls to that number.
40 × 14 days + 200 = 760 units
Not sure how much safety stock to hold? Work it out from your demand swings with the safety stock calculator, then bring it back here.
The same SKU at different lead times
| Lead time | Lead-time demand | Reorder point |
|---|---|---|
| 7 days | 280 units | 480 units |
| 14 days | 560 units | 760 units |
| 21 days | 840 units | 1,040 units |
| 30 days | 1,200 units | 1,400 units |
| 45 days | 1,800 units | 2,000 units |
| 60 days | 2,400 units | 2,600 units |
Common questions
What is the reorder point formula?
Reorder point = daily demand × lead time (in days) + safety stock. For 40 units a day, a 14-day lead time and 200 units of safety stock, the reorder point is 40 × 14 + 200 = 760 units.
What is the difference between the reorder point and safety stock?
Safety stock is the buffer you keep for demand spikes and late deliveries. The reorder point includes it: it is the demand you expect during the lead time plus that buffer.
How do I find my lead time?
Measure the days from placing a purchase order to having the units received and available to sell, not just the supplier’s production time. Include transit, customs and warehouse receiving.
Should I use average or peak daily demand?
Use average daily demand for the reorder point and cover the variation with safety stock. Recalculate before seasonal peaks, when daily demand changes.
More shipping and inventory tools
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