Reorder Point Calculator
Know exactly when to place your next order — before you stock out, without overstocking. Free, no signup.
The Reorder Point Formula
Reorder Point = (Average Daily Usage × Lead Time) + Safety Stock
The logic: while your replenishment order travels from supplier to shelf, you keep selling. The first term — lead time demand — is what you'll sell during that wait. Add your safety stock buffer, and the total is the stock level that should trigger a new order. Drop below it without ordering and you're gambling your buffer against a delivery delay.
Worked Example
A store sells 20 units a day. Its supplier takes 7 days to deliver, and it keeps 50 units of safety stock:
- Lead time demand = 20 × 7 = 140 units
- Reorder point = 140 + 50 = 190 units
- When stock hits 190, order. The order lands just as stock approaches the 50-unit buffer.
Getting the Inputs Right
- Average daily usage: total units sold ÷ days in the period. Use at least 90 days of history, and recalculate for seasonal products — a December average applied in July will bury you in stock.
- Lead time: use the supplier's actual recent performance, not the quoted time. If deliveries range 5–10 days, calculating with 7 and buffering the variance via safety stock is the standard approach.
- Safety stock: the shock absorber for demand spikes and late deliveries. Calculate it properly with our safety stock calculator rather than guessing.
Reorder Point vs EOQ
These two are a pair: the reorder point answers when to order, the economic order quantity answers how much. A complete replenishment policy is "order EOQ units every time stock reaches the reorder point."
Frequently Asked Questions
Can I calculate a reorder point without safety stock?
Yes — set safety stock to zero and the formula reduces to daily usage × lead time. It only works when demand and lead times are extremely stable; for most businesses a zero buffer means periodic stockouts.
How often should I recalculate reorder points?
Quarterly, plus whenever a supplier's lead time changes or a product's sales trend shifts. Stale reorder points are one of the most common causes of both stockouts and overstock.
Is the reorder point the same as minimum stock level?
Related but different: minimum stock level is usually your safety stock — the floor you never want to cross. The reorder point sits above it by exactly one lead time of demand, so orders arrive before you touch the floor.
Does my inventory valuation method affect the reorder point?
No — reorder points are about units and timing, not costs. But both feed the same planning picture: valuation tells you what your stock is worth (ending inventory calculator), reorder points keep the right amount of it on hand.
Know What Your Stock Is Worth, Too
Reorder points keep stock on the shelf; valuation tells you what it's worth. Upload your transactions for FIFO, LIFO, and Weighted Average results.
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