Reorder Point & Safety Stock Calculator
Know exactly when to reorder — safety stock and reorder point from daily demand, lead time and a service-level buffer.
How it works
Safety stock = daily demand × buffer days · Reorder point = (daily demand × lead time) + safety stock
The reorder point is the inventory level that should trigger a new purchase order so fresh stock arrives just as you run low. It is the demand you expect during the supplier’s lead time, plus a safety-stock cushion for demand spikes and late deliveries. Setting it too low risks stockouts; too high ties up cash in excess inventory.
Worked example
Selling 40 units a day with a 7-day lead time, you expect to consume 280 units while waiting for a delivery. Adding a 3-day (120-unit) safety buffer gives a reorder point of 400 units — order the moment stock falls to 400.
Frequently asked questions
How much safety stock do I need?
It depends on how variable your demand and lead times are and how costly a stockout is. A common simple rule is to hold a fixed number of days of demand as buffer; statistical methods scale the buffer to your demand variability and a target service level.
What happens if I set the reorder point too low?
You risk running out before the replenishment arrives, losing sales and possibly customers. The safety-stock component exists precisely to absorb the normal variation that would otherwise cause stockouts during the lead time.
How does this relate to order quantity?
The reorder point tells you when to order; the economic order quantity tells you how much to order each time. Together they define a complete reorder policy for an item.
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Educational estimate, not financial advice.