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Reorder Point & Safety Stock Calculator

Updated .

Your reorder point is the stock level at which you place the next purchase order — lead-time demand plus safety stock. This calculator combines your demand variability and supplier lead-time variability at a target service level to size both, and shows the capital tied up in the buffer.

Your numbers
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    Send me my reorder point

    We'll email the calculation so you can set the trigger in your inventory system.

    How this is calculated

    A reorder point has two parts. The first is the stock you will sell while waiting for the new order to arrive — average daily sales multiplied by lead time. The second is safety stock, which absorbs the days you sell more than average and the days your supplier arrives later than promised.

    Safety stock is calculated from both sources of uncertainty combined, not just one. A reliable supplier with wildly variable demand and an erratic supplier with steady demand can need similar buffers for different reasons, and treating only one of them is how stores run out despite having a formula.

    Service level is the dial you control. Raising it from 95% to 99% does not cost 4% more stock — it costs substantially more, because the tail of the distribution is expensive to cover. The capital tied up in safety stock is shown so you can judge whether that insurance is worth the cash.

    Lead time demand = average daily sales × lead time σ = √(lead time × demand SD² + daily sales² × lead time SD²) Safety stock = Z(service level) × σ Reorder point = lead time demand + safety stock Days of cover = units on hand ÷ average daily sales

    Questions merchants ask

    How do I estimate my daily sales variability?

    Export daily unit sales for the last 60 to 90 days and take the standard deviation. If you cannot easily do that, a workable approximation is your busiest day minus your average day, divided by two. Exclude promotional spikes, or they will inflate your buffer year-round.

    What service level should I target?

    95% is a common default and means you expect to fill 95% of demand from stock during the lead time window. Use higher for products customers will not wait for or that anchor your advertising, lower for slow-moving long-tail items where the carrying cost is not worth it.

    Should safety stock change during peak season?

    Yes. Both average daily sales and variability rise, so a reorder point set in a quiet month will be far too low in November. Recalculate with peak-period figures before your busy season rather than during it.

    Does this handle products with seasonal demand?

    Not directly — it assumes demand is roughly stable over the lead time window. For strongly seasonal products, run it separately for each season using that season's own sales data.

    Estimates only. Enter your own processing rates and costs — nothing here is pulled from a platform price list, so it stays accurate as fees change.