Free inventory tool
Reorder point and safety stock calculator.
Enter how much you use a day and how long a supplier takes to deliver. You get the stock level at which to reorder, with safety stock worked out three ways, and the stock levels in ICAI’s study material for CA students.
- Three safety stock methods
- ICAI re-order, minimum and maximum levels
- Nothing is sent or saved
Reorder point calculator
How it’s worked out.
The stock levels are ICAI’s, from its CA Intermediate study material. The service-level method is the standard one from operations courses.
Reorder point = expected usage over the lead time + safety stock.
Source: MIT OpenCourseWare, ESD.260 Inventory Management, slide 9, checked 17 Oct 2026
Safety stock is stock kept over and above lead-time usage, as a cushion against unexpected demand.
Source: ICAI study material, Cost and Management Accounting, Material Cost, p. 2.33, checked 17 Oct 2026
Re-order level = maximum consumption × maximum re-order period. The re-order period is also called the lead time.
Source: ICAI study material, Cost and Management Accounting, Material Cost, p. 2.22–2.23, checked 17 Oct 2026
Minimum stock level = re-order level − (average consumption × average re-order period). Average consumption is also called normal consumption.
Source: ICAI study material, Cost and Management Accounting, Material Cost, p. 2.23, 2.27, checked 17 Oct 2026
Maximum stock level = re-order level + re-order quantity − (minimum consumption × minimum re-order period). The re-order quantity may be the EOQ.
Source: ICAI study material, Cost and Management Accounting, Material Cost, p. 2.27, checked 17 Oct 2026
Average stock level = minimum level + ½ re-order quantity, or ½ (minimum level + maximum level). Danger level = average consumption × lead time for an emergency purchase.
Source: ICAI study material, Cost and Management Accounting, Material Cost, p. 2.27, checked 17 Oct 2026
For a service level, safety stock = Z × the standard deviation of demand × √(lead time ÷ the period the deviation was measured over).
Source: P. L. King, APICS magazine, July/August 2011, p. 34, checked 17 Oct 2026
Z is 1.282 for 90%, 1.645 for 95%, 1.960 for 97.5% and 2.326 for 99%.
Source: NIST/SEMATECH e-Handbook of Statistical Methods, 1.3.6.7.1, checked 17 Oct 2026
One example, step by step.
A trader in Indore sells 15 cartons of an item a day, 20 on a busy day and 10 on a slow one. The supplier delivers in 10 days, 15 at worst and 5 at best. The EOQ is 200 cartons.
- Usage over the lead time15 × 10 days
- 150
- Reorder point, 5 days of cover150 + 15 × 5
- 225
- Reorder point, 95% service level150 + 1.645 × 4 × √10 = 170.81
- 171
- Minimum level (ICAI)300 − 15 × 10
- 150
- Maximum level (ICAI)300 + 200 − 10 × 5
- 450
- Danger level (ICAI)15 × 4 emergency days
- 60
- Safety stock, max − average20 × 15 − 15 × 10
- 150
- Reorder point, max − average, cartons
- 300
Order when stock falls to 300 cartons. That is ICAI’s re-order level too: 20 a day × 15 days.
An illustration. The figures are ICAI’s Illustration 6 in the Material Cost chapter, with a standard deviation of 4 cartons a day assumed for the service-level line.
What it does not cover.
A reorder point is only as good as the usage and lead times behind it. Check these first.
Usage that changes with the season
The figures assume this month looks like last month. Before a festival season or after a price change, work it out again with new usage.
Ordering on fixed days
If you only place orders once a week, stock can fall well below the reorder point before the next order goes out. Count the wait in the lead time.
Work out the deviation of demand over the total lead time, including any review period.
Source: P. L. King, APICS magazine, July/August 2011, p. 34, checked 17 Oct 2026
Lead times that vary
The service-level method here treats the lead time as fixed. If deliveries swing a lot, you need more safety stock than it shows. “Max − average” allows for the longest wait.
Other safety stock formulas
Some textbooks and exam papers use other versions. An older ICAI practice manual gives one based on the gap between maximum and average lead time.
Safety stock = annual demand ÷ 365 × (maximum lead time − average lead time).
Source: ICAI practice manual, IPCC Cost Accounting, Material, p. 2.6, checked 17 Oct 2026
Many items, many suppliers
The calculator works one item at a time. For hundreds of items, keep the levels on each item in your stock system.
More inventory tools.
How much to order, when to reorder, and what your stock is worth. And the tools that go with this one.
Reorder questions people ask.
What is a reorder point?
The stock level at which you place the next order. It is what you expect to use while the order is on its way, plus safety stock for a busy day or a late delivery.
How do I calculate the reorder point?
Reorder point = average daily usage × lead time in days + safety stock. Selling 15 a day with a 10-day lead time and 150 of safety stock, you reorder at 300.
How much safety stock should I keep?
It depends on how much your usage and deliveries swing, and how much a stock-out costs you. The calculator gives three ways: the busiest usage over the longest lead time, a service level from the spread of daily usage, or a fixed number of days.
What service level should I choose?
Higher means fewer stock-outs but more stock: going from 95% to 99% adds about 40% to the safety stock. Keep the higher levels for items whose shortage stops a sale or a production line.
What are the ICAI formulas for re-order, minimum and maximum level?
Re-order level = maximum usage × maximum re-order period. Minimum level = re-order level − average usage × average re-order period. Maximum level = re-order level + re-order quantity − minimum usage × minimum re-order period.
Is the reorder point the same as the re-order level?
Yes, they are two names for the stock level at which you order. ICAI’s re-order level is maximum usage × maximum lead time, which is the same as average usage over the lead time plus the “max − average” safety stock.
What is the danger level?
The level at which normal issues stop and only urgent ones are made, while an emergency purchase is arranged. ICAI works it out as average usage × the lead time for an emergency purchase.
Is what I type saved or sent anywhere?
No. The figures are worked out in your browser. Nothing is sent, stored or tracked by the calculator.
Can PrimoERP warn me when stock is low?
Yes. Each item has a reorder level. When stock falls below it you are told, and a purchase order is drafted for you to approve.
— the PrimoERP team
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