Reorder before the empty shelf tells you
Set a practical reorder point that accounts for sales during supplier lead time and safety stock.
The move: trigger the order while stock still covers the wait. A reorder point answers one question: when do we order more? The answer should account for two quantities: lead-time demand and safety stock. Lead-time demand is what you expect to sell while waiting for replenishment. Safety stock is the cushion for the demand or delivery surprise. For a bookstore, the formula is practical, not academic: average copies sold per day times supplier lead time, plus a buffer. A title that sells two per day with a five-day distributor lead time needs about ten copies to cover the wait. If…
Sign up free — one personalized lesson every day, matched to your role and goals.
Already have an account? Sign in