Calculate when to reorder stock. Avoid stockouts and overstock. This tool helps you calculate, understand, and optimize this metric for your business.
When stock drops to 400 units, place the order. That covers the 7 days you wait for delivery plus a 3 day buffer for a late supplier or a busy week. Raise the buffer for items where a stockout loses the customer, not just the sale.
A reorder point turns "we are running low" into a number. When stock falls to it, you order, and the arithmetic is simple: how much you sell in a day, multiplied by how many days you wait for the supplier, plus a buffer.
Most stockouts in small Kenyan retail are not caused by bad forecasting. They are caused by nobody having agreed the trigger in advance, so the order goes in when someone notices an empty shelf.
The buffer covers the supplier being late and the week being busier than usual. Set it higher for items where a stockout sends the customer to a competitor rather than just delaying the sale, and for suppliers whose lead time you know varies.
Set it lower for perishables and for anything where holding stock costs you more than missing a sale.
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