How do you calculate the reorder point?

Average demand during the lead time plus safety stock, rounded up. A part used 11.4 a week with a 21.2-day lead time uses 34.5 in the lead time; with 14 units of safety stock the reorder point is 49. Order when on hand plus on order, minus anything committed, is at or below it.

How do you calculate safety stock?

Safety stock = z × the standard deviation of demand over the lead time, where z comes from the service level: 1.282 for 90%, 1.645 for 95%, 2.054 for 98%, 2.326 for 99%. When the lead time varies too, the spread is the square root of (lead time in periods × the demand standard deviation squared + (lead time standard deviation × average demand) squared).

What service level should I use?

There is no standard. Peter King wrote in APICS magazine in 2011 that 90 to 98 percent is typical for cycle service level and that targets should be set by group of parts, by importance, margin or dollar volume. The step is not linear: 99% needs about 41% more safety stock than 95%. The three targets in the file, 98, 95 and 90 percent for A, B and C, are examples.

What is the difference between cycle service level and fill rate?

Cycle service level is the share of order cycles without a stockout and ignores how large a stockout is. Fill rate is the share of demand filled from stock. In the example a 90% cycle service level on a fastener fills 99.8% of demand, because each order is large. The sheet shows both for every part and can size by either.

How is this different from the safety stock calculator?

The calculator sizes one part from numbers you type. This sheet takes the average and spread from each part's own history and receipts, handles up to 500 parts, sets targets by ABC class and gives an order list. For parts used a few times a year, use the critical spare parts list: the normal curve does not fit them.

Free template

Updated October 14, 2026

Reorder point and safety stock sheet (many parts)

The reorder point is the stock level at which you place an order so the new stock arrives before the old runs out: the demand expected during the lead time plus a safety stock for the variation in demand and in the supplier's lead time. The ASCM Supply Chain Dictionary defines the order point the same way, as forecast usage during the replenishment lead time plus safety stock. This template works it out for a whole store at once. For each part you list the cost, the stock and the lead time and paste 26 periods of demand and the last 6 receipts. The Excel then works out the average and spread of each, the ABC class, the safety stock and reorder point for the service target you set for that class, an order quantity, and what to do today. It holds 500 parts, with an order list, an ABC ranking and a summary, and a 40-part worked example. The PDF has a part sheet for a short list, every formula with its source, and the same example.

Free to use: print it, copy it and edit it for your team. Enter your name and work email once to download.

Page 1 of the reorder point and safety stock sheet — 500 partsDemand spread from historyLead time spread from receiptsABC class by valueService targets by classSafety stock and reorder pointOrder quantity (EOQ)Order listCycle service level and fill rateWorked example

When to use it

When to use a reorder point and safety stock sheet

When a store or a buyer sets reorder levels by feel, or as a flat share of last year's use, and some parts run out while others sit for months.
When nobody can say what service level the stock was meant to give, or what each point of it costs.
Before you resize a min-max or two-bin system, or after demand or a supplier's lead time has changed.
To see where the safety stock money is, by ABC class, before a service level conversation with purchasing and finance.

How to fill it in

1
Set the rules on Settings
Days in a demand period (7 for weekly history), the review period (0 if the system flags a part the moment it reaches the reorder point), a service target for each class, the cost to place an order and the carrying rate. The values in the file are examples; agree your own.
2
List the parts
One row each: part number, unit cost, on hand, on order, backordered or committed, planned lead time. Add an order multiple if the supplier ships in packs, and a class if a part matters more than its value says, such as a single-source part with a long lead time.
3
Paste the history
26 periods of demand per part, oldest first, and the last 6 receipts as days from order to stock. Type 0 for a period with no demand; leave a cell blank only when you do not know. For a new part, type a forecast and its error instead.
4
Read the Results
Status says Order now, OK, Above max, No demand, or Check data with what is missing. Notes flags a short history and lumpy demand, where the normal curve fits poorly. Filter Status for Order now.
5
Place the orders from the Order list
Parts at or below their reorder point, with the quantity (whole multiples of the order quantity that lift the stock position above the reorder point) and the value. Print it for the buyer.
6
Review it
After a quarter, check whether safety stock was used in about half of the order cycles and whether the service targets were met. Find the cause of a miss before you change a target, and paste fresh history every month or two.

How the numbers sit on the stock curve

Reorder point, safety stock and lead time on one picture

Stock falls at the average rate of use. When it reaches the reorder point an order goes out. The reorder point is the safety stock plus the demand expected before the order arrives, so a normal cycle lands on the safety stock, and a late or heavy one eats into it.

Stock on hand over two order cycles for the example's linear guide rail

Example numbers

Safety stock 14 and order quantity 62 give 76 just after a receipt. The grey band is the lead time, the yellow band is the safety stock.

Settings

The choices that change the answer

Each is one cell on the Settings sheet. The file ships with example values; the sources say what each choice means, not which value to pick.

Choice	What it means	Use it when	What the sheet does
Cycle service level	The share of order cycles that end without a stockout. A short stockout and a long one count the same.	You care how often the line or the customer is let down.	z = NORMSINV(target). The default.
Fill rate	The share of demand filled from stock. A small shortage counts for little, a large one for a lot.	You care how many units you could not supply.	Finds the z where the expected shortage per cycle equals (1 - target) × order quantity. Continuous review only. Both measures are shown for every part.
Review period	How long between looks at the stock: 0 if every issue and receipt is posted and flagged at once, 1 for a daily run, 7 for a weekly one.	Orders are placed on a schedule, not the moment a part reaches its level.	Adds it to the lead time the safety stock must cover.
Demand and lead time not independent	The same event moves both, so a late delivery and a demand spike arrive together.	You have seen that pattern in your own records.	Adds the two safety stock terms instead of combining them in a square root (King, 2011).

Cycle service level
What it means
The share of order cycles that end without a stockout. A short stockout and a long one count the same.
Use it when
You care how often the line or the customer is let down.
What the sheet does
z = NORMSINV(target). The default.
Fill rate
What it means
The share of demand filled from stock. A small shortage counts for little, a large one for a lot.
Use it when
You care how many units you could not supply.
What the sheet does
Finds the z where the expected shortage per cycle equals (1 - target) × order quantity. Continuous review only. Both measures are shown for every part.
Review period
What it means
How long between looks at the stock: 0 if every issue and receipt is posted and flagged at once, 1 for a daily run, 7 for a weekly one.
Use it when
Orders are placed on a schedule, not the moment a part reaches its level.
What the sheet does
Adds it to the lead time the safety stock must cover.
Demand and lead time not independent
What it means
The same event moves both, so a late delivery and a demand spike arrive together.
Use it when
You have seen that pattern in your own records.
What the sheet does
Adds the two safety stock terms instead of combining them in a square root (King, 2011).

A filled-in example

Illustrative, not a benchmark

An example: a made-up machining plant store with 40 purchased parts, 26 weeks of demand and 6 supplier receipts for each (illustrative numbers).

The example's linear guide rail, from the spread to the reorder point

Reorder point = demand over the lead time + z × spread over the lead time

Spread = sqrt(lead time in weeks × demand sd² + (lead time sd × weekly demand ÷ 7)²)

Spread =sqrt(3.03 × 3.2² + (2.0 × 11.4 ÷ 7)²)= 6.4
Safety stock =2.05 × 6.4= 13.2, so 14
Demand over the lead time =11.4 × 21.2 ÷ 7= 34.5

Reorder point49

Share of the annual usage value, by class

A (9 parts): 80.2 % of value
B (16 parts): 15.5 % of value
C (15 parts): 4.4 % of value

Share of the value of the safety stock, by class

A: 92.4 % of value
B: 6.5 % of value
C: 1.1 % of value

Class A is 9 of the 40 parts and 80% of the usage value, but 92% of the money in safety stock. That is where a change to a service target pays or costs.

ABC: 9 of the 40 parts (23%) carry 80% of the 1,659,227 annual usage value; the 16 B parts carry 15% and the 15 C parts 4%. The safety stock is worth 71,419: 65,985 (92%) in class A, 4,649 in B and 786 in C.
Linear guide rail (A): it averages 11.4 a week with a standard deviation of 3.2, and the lead time averages 21.2 days with a standard deviation of 2.0. The spread over the lead time is sqrt(3.02 × 3.2² + (2.0 × 11.4 ÷ 7)²) = 6.4. At a 98% target z = 2.05, so the safety stock is 13.2, rounded up to 14. Demand over the lead time is 34.5, so the reorder point is 49. The EOQ is sqrt(2 × 595.6 × 60 ÷ (0.20 × 96)) = 61.0, so the order quantity is 62. With 55 in stock position, no order yet.
6 parts are at or below their reorder point, an order value of 18,294. One part is above its max (the PLC module) and one has no demand (a retired gasket set).
Flags: the hydraulic pump is lumpy (standard deviation 1.6 against an average of 0.8 a week), the new seal kit has 8 weeks of history, and the limit switch is class A because the planner set it (single source, about 50 days lead time) although its value says C.
Setting class A to 95% instead of 98% cuts the safety stock value from 71,419 to 59,123, which is 12,296 less. A 90% cycle service level on a fastener still fills 99.8% of demand, because each order is large.

The planner places the 6 orders, checks the PLC module's open order, and takes the 98% target for class A to the next review with the 12,296 figure beside it. Nothing in the formula decides that; it only shows what the choice costs.

Common mistakes

One service level for every part
A flat 98% costs little on a washer and a lot on a PLC module. King's advice is to set the target by group on importance, margin or dollar volume. In the example the 9 class A parts hold 92% of the safety stock value, so that is where a target change pays or hurts.
Mixing time units
A weekly standard deviation against a lead time in days gives the wrong spread. The spread over n periods is the period spread times the square root of n. The sheet converts for you; if you work by hand, convert the same way.
Leaving out lead time variation
A supplier that averages 21 days but ranges from 19 to 23 needs more safety stock than one that is always 21. In the example the lead time accounts for 27% of the variance of the linear guide rail.
Looking only at what is on the shelf
A part with an order on the way is not short. Compare on hand plus on order, minus anything backordered or committed, with the reorder point.
Trusting the normal curve on lumpy parts
When the standard deviation is bigger than the average, as for a part sold in a few large orders, the curve puts about 16% of its area below zero demand. The sheet flags those parts. Review them by hand, or use the critical spare parts list for parts used a few times a year.

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