Parts and inventory
Reorder point calculator
The reorder point is the stock level at which you place the next order. Set it correctly and the replenishment arrives just as you reach safety stock; set it low and you find out during a breakdown.
Reorder point = (Average daily usage × Lead time in days) + Safety stock
Over a period long enough to include a slow month
Calculate this separately, then bring the figure here
Show the assumptions
- Formula
- Reorder point = (Average daily usage × Lead time in days) + Safety stock
Lead time means the whole cycle, from raising the requisition to the part being on the shelf and receipted. Quoting the supplier’s shipping time alone is the usual reason a correctly calculated reorder point still runs out.
Reorder point
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Prefilled with an example. Change any number and the result updates.
How to calculate Reorder point
Reorder point = (Average daily usage × Lead time in days) + Safety stock
Worked example
- Average daily usage 4 units
- Supplier lead time 14 days
- Safety stock 20 units
Reorder point = 76 units
Reading the result
Lead time means the whole cycle, from raising the requisition to the part being on the shelf and receipted. Quoting the supplier’s shipping time alone is the usual reason a correctly calculated reorder point still runs out.
Reorder point questions
What is the difference between reorder point and safety stock?
Safety stock is the buffer you hold against demand and lead time going wrong. The reorder point is the trigger level, and it includes safety stock plus the stock you expect to consume while waiting for the order. You need both, and they answer different questions.
How do I handle a part I use twice a year?
Usage-based formulas break down on slow movers, because the average daily usage is close to zero and the reorder point comes out below one. For critical spares with sporadic demand, stock to criticality instead: hold one if failure stops production and the lead time is longer than you can tolerate, whatever the usage says.
Should the reorder point change through the year?
It should if either input does. A part consumed mainly during summer cooling load, or one whose lead time stretches over a holiday shutdown, needs the point recalculated for that window rather than an annual average applied year-round.
Related calculators
Set reorder points per part
UpKeep records the work, the hours and the failures this metric depends on, so Reorder point is a report rather than a spreadsheet exercise.