Re-order Point
Re-order point = (average demand × lead time) + safety stock. When current stock drops to this level, trigger a purchase order.
Re-order point
20.0units
Formula, assumptions, and limits
Fixed-quantity reorder policy (Q-model). Continuous review detects ROP crossing immediately; periodic review misses it by up to one review interval - compensate with more safety stock.
Symbol legend
| Symbol | Meaning | Unit | Source |
|---|---|---|---|
| Mean demand per period | units | history | |
| Lead time | periods | procurement | |
| Safety stock | units | safety-stock calc |