Glossary
Reorder Point
The reorder point is the inventory level at which a new purchase order should be placed to replenish stock before it runs out.
Full explanation
The reorder point is calculated as: ROP = (average daily demand × lead time) + safety stock. This ensures that new stock arrives before existing inventory is depleted, accounting for both expected consumption during the lead time window and a safety buffer for variability.
Stocklyst calculates reorder points automatically for every item at every branch, using demand pattern classification to select the appropriate statistical model. For smooth demand items, standard formulas apply. For intermittent or lumpy demand patterns (classified using the Syntetos-Boylan 2005 framework), adjusted parameters and higher safety factors are used to prevent chronic understocking.
Formula
ROP = (average daily demand × lead time) + safety stockHow Stocklyst handles this
Stocklyst computes reorder points per item, per branch, adapting the calculation to each item’s demand classification. Reorder alerts are generated automatically when stock drops below the calculated threshold, and the values update as new demand data accumulates.