Inventory
Reorder point calculator
Running out of stock on a marketplace does not just cost the sales you miss, it costs the rank you spent months earning. This works out the stock level at which you have to place the order, and how many units that order should be.
This SKU
Sellable units, everywhere.
Average over the last month or two.
Roughly how many units above or below average a busy or quiet day runs. If you have no idea, a third of your daily average is a fair starting point.
Order placed to stock sellable.
A supplier who is never late gets zero.
Monthly ordering is thirty.
12 days
Below the reorder point, place the order today
1038
Reorder point, in units
303
Safety stock
1668
Order this many now
₹3,00,240
Cash that order needs
₹75,600
Cash sitting in stock today
You are at or below the reorder point of 1038 units. With a 21 day lead time, anything ordered today arrives around the point you run dry, which is about 30 Sept 2026. Every day you wait now is a day out of stock later.
How the reorder point is built
Sales during the lead time
35 a day for 21 days.
735 units
Safety stock
Covers a busy week and a late supplier at the same time.
303 units
Reorder when stock reaches
1038 units
Safety stock here is worth ₹54,540. That is the price of not running out, and it is a real cost. Lowering your service level makes it cheaper and makes stockouts more likely, which on a marketplace also costs you search rank.
How this works
- The reorder point is what you expect to sell while you wait for the new stock, plus a buffer for the days that go wrong.
- Safety stock covers two separate surprises at once: selling faster than usual, and the supplier arriving later than promised. Both are handled, rather than one being ignored.
- The service level you pick decides how big that buffer is. Ninety five percent means expecting to run out about one cycle in twenty.
- The suggested order quantity brings you up to enough stock for the lead time plus the gap until your next order, which is the number most reorder calculators leave out.
- Everything is reported in cash as well as units, because a reorder decision is really a decision about where your working capital sits.
Questions sellers ask
Why does running out of stock cost more than the lost sales?
Because marketplaces rank on sales velocity and availability. A listing that goes out of stock loses position, and the position does not come back the day the stock does. On Amazon in particular, a week out of stock on a well ranked listing can take a month of steady sales to recover from.
I do not know how much my daily sales swing. What should I put?
A third of your daily average is a reasonable stand in for most SKUs. If the product is seasonal or spikes during sale events, use half. The number only needs to be roughly right to be far more useful than ignoring variation altogether.
Should I use a ninety nine percent service level to be safe?
Usually not. The safety stock needed rises sharply for the last few percent, and that money is then stuck in one SKU. Ninety five percent is the sensible default for most catalogues. Save ninety eight or ninety nine for your genuine top sellers, where a stockout is expensive.
How is this different from just keeping thirty days of stock?
A flat rule ignores lead time and ignores how erratic the product is. A SKU with a forty five day lead time needs far more than thirty days of cover, and a steady seller needs less buffer than a spiky one. The flat rule leaves you overstocked on the calm products and out of stock on the important ones.
What counts as overstock?
More than about four months of cover is worth questioning for most categories, and anything past six months is usually money you are not getting back soon. The exception is genuine seasonal buying, where holding stock ahead of a peak is the plan rather than a mistake.