Glossary
Reorder point
Definition
The stock level at which you place the next purchase order, calculated as average daily sales multiplied by supplier lead time, plus safety stock.
The formula is simple; keeping its inputs current is the work. Both average daily sales and supplier lead times change seasonally, and they usually change in the worst possible combination — demand rises exactly when suppliers slow down.
Recalculate monthly, and hold a separate set of figures for your festive period rather than discovering the difference during it.