Calculator Inputs
Use the basic method for simple peak demand planning. Use the statistical method for service level targets.
Plotly Graph
This chart compares demand during lead time, safety stock, reorder point, and current net stock.
Example Data Table
| Scenario | Average Daily Demand | Average Lead Time | Service Level | Safety Stock | Reorder Point |
|---|---|---|---|---|---|
| Fasteners Line A | 120 units | 8 days | 95% | 150 units | 1,110 units |
| Valve Assembly B | 85 units | 12 days | 97% | 210 units | 1,230 units |
| Sensor Kit C | 60 units | 6 days | 90% | 70 units | 430 units |
Formula Used
Expected Lead Time Demand = Average Daily Demand × Average Lead Time
Basic Safety Stock = (Maximum Daily Demand × Maximum Lead Time) − (Average Daily Demand × Average Lead Time)
Statistical Safety Stock = Z × √[(Average Lead Time × Demand Standard Deviation²) + (Average Daily Demand² × Lead Time Standard Deviation²)]
Reorder Point = Expected Lead Time Demand + Safety Stock
Net Available Stock = On-Hand Stock + Incoming Stock − Backorders
The basic method suits rough planning. The statistical method supports service-level-driven inventory control.
How to Use This Calculator
- Choose the calculation method.
- Enter average and maximum demand values.
- Enter average and maximum lead time values.
- Set a target service level percentage.
- Enter demand and lead time variation.
- Add on-hand stock, incoming stock, and backorders.
- Click calculate to view the result summary.
- Review the chart and export the results if needed.
FAQs
1. What does a reorder point mean?
A reorder point is the stock level that triggers a new purchase or production order. It helps avoid stockouts during supplier lead time.
2. Why is safety stock important?
Safety stock protects operations from uncertainty. It absorbs demand spikes, delivery delays, and planning errors that can interrupt service or production.
3. Which method should I choose?
Use the basic method for quick planning with known extremes. Use the statistical method when you track variability and manage service levels more precisely.
4. What service level should I enter?
Higher service levels reduce stockout risk but increase inventory. Many operations use 90% to 99%, depending on criticality, cost, and customer expectations.
5. Can this help manufacturing teams?
Yes. Engineering and manufacturing teams can use it for purchased parts, maintenance spares, assembly components, and production support materials.
6. What if my lead time changes often?
Use the statistical method and enter lead time standard deviation. That gives a more realistic buffer when supplier performance varies.
7. Should backorders affect reorder decisions?
Yes. Backorders reduce effective availability. Including them helps you see actual exposure and whether replenishment should happen immediately.
8. Can I export the results?
Yes. The calculator includes CSV and PDF export buttons after calculation, making it easier to share results with teams or records.