1. Estimate daily sales
Use a recent period representative of expected demand and divide units sold by selling days.
2. Enter lead time
Count calendar days from placing the order until units are available for sale.
3. Choose safety coverage
Add buffer days for demand variation, late suppliers, or receiving delays.
4. Record available and incoming units
Current stock should exclude damaged or committed inventory; incoming stock should include only confirmed orders.
5. Review the reorder point and quantity
Order when inventory position reaches the reorder point, and adjust the suggested quantity for case packs or cash limits.