Calculate a reorder trigger for one SKU
Formula
Reorder point = average daily unit demand × replenishment lead time in days + safety stock
The tool rounds this trigger up to a whole unit. It shows when to review replenishment under your assumptions. It does not choose the size of a purchase order.
Use one SKU, one consistent unit of measure, and stock that can serve the same demand. Do not combine unrelated products or warehouses whose stock cannot be transferred in time. Daily demand models additional demand during the lead time; do not include the same existing commitments in that forecast a second time. Average daily demand can have two decimals; all stock quantities are whole units. Lead time is a whole number from 0 to 365 days.
Choose demand and lead time that use the same days
Divide expected unit demand by the days in a representative period. An average from a stockout period can understate demand because missed sales are absent. Promotions, seasonality and new products need a separately reviewed estimate.
Lead time should cover the interval from placing an order until the goods are available to sell, including preparation, transport and receiving. Use calendar-day demand with a calendar-day lead time. Convert a supplier quote in business days to an elapsed-day assumption in your own records before entering it.
Safety stock is the extra unit buffer you choose. This tool accepts that buffer; it does not estimate demand variability, set a service level or guarantee protection from a stockout. Keep the chosen safety stock separate from the lead-time demand.
Why incoming stock and commitments matter
Inventory position
Inventory position = on-hand units + confirmed units on order − committed units
Enter on-hand stock before subtracting unfulfilled commitments, then enter those commitments once. Exclude damaged, expired or otherwise unusable stock. Enter 0 on order when there is no confirmed incoming stock.
Include incoming units only when they can serve this demand in time. An aggregate position cannot test individual arrival dates. Even an above-trigger result needs review when a shipment is late or commitments cannot be filled today.
The separate on-hand view excludes incoming units. Available on hand is the greater of zero and on-hand units minus commitments. Days of cover divides that amount by average daily demand. The no-new-receipts balance subtracts commitments and expected lead-time demand from current on-hand stock. A negative figure represents uncovered demand in that scenario, not physical stock below zero.
Example: 170-unit trigger and 140-unit position
At 10 units per day and 14 days of lead time, expected lead-time demand is 140 units. Add 30 units of safety stock: the reorder point is 170 units. With 150 units on hand, no incoming stock and 10 committed units, inventory position is 140 units.
| Measure | Value |
|---|---|
| Average daily demand | 10 units |
| Lead time | 14 days |
| Expected lead-time demand | 140 units |
| Safety stock | 30 units |
| Reorder point | 170 units |
| On hand | 150 units |
| Confirmed incoming | 0 units |
| Committed | 10 units |
| Inventory position | 140 units |
| Position below trigger | 30 units |
The position is 30 units below the trigger, so the tool flags replenishment for review. That 30-unit gap is not a suggested order size. Uncommitted stock covers 14 days at the entered demand. If there are no new receipts, the balance after lead time is zero. Test a longer lead time to see how a delay changes the trigger and that balance.
What does an at-trigger or zero-demand result mean?
A positive-demand position equal to or below the rounded trigger is flagged for review. Above-trigger means only that the entered aggregate position exceeds that threshold. It does not confirm shipment timing or adequate available stock.
When daily demand is zero, the tool shows the entered safety-stock threshold but leaves days of cover unavailable and gives no demand-based trigger. Check whether the item is inactive or the demand estimate is missing. When commitments exceed stock on hand, the separate commitment-shortfall warning remains relevant even if incoming stock raises the position.
Plan the purchase and its cash payment separately
Order size also depends on pack sizes, minimum quantities, supplier terms, storage, expiry and your desired coverage. This calculator does not optimize those decisions or place orders. Use the cash flow planner to test when a supplier payment could reduce your cash balance, and the landed-cost calculator to prepare a shipment cost.
The inventory turnover calculator measures historical cost movement for a period. It does not replace this SKU-level quantity check. Review Taxomate’s supported accounting workflows for actual marketplace activity. This manual calculator does not provide live stock synchronization or automated purchase alerts.
Questions sellers ask
Does the reorder point tell me how much to order?
No. It shows when to review replenishment under your assumptions. Order size also depends on pack sizes, minimum quantities, supplier terms, storage, expiry and your desired coverage. This calculator does not optimize those decisions or place orders.
Does the tool set my safety stock?
No. Safety stock is the extra unit buffer you choose. This tool accepts that buffer; it does not estimate demand variability, set a service level or guarantee protection from a stockout.
Should I count incoming stock in my inventory position?
Include incoming units only when they are confirmed and can serve this demand in time. An aggregate position cannot test individual arrival dates, so an above-trigger result still needs review when a shipment is late.
How do I enter a supplier lead time quoted in business days?
Use calendar-day demand with a calendar-day lead time. Convert a supplier quote in business days to an elapsed-day assumption in your own records before entering it.
Method and sources
NetSuite’s reorder-point guide supports the lead-time demand and safety-stock formula and separates timing from order size. Oracle’s replenishment documentation describes on-hand stock, commitments and purchase orders in the available-position calculation. Sources reviewed October 14, 2026. The rounding and no-new-receipts comparisons above are explicit assumptions of this tool.
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