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Assuming no safety stock, what is the re-order point (R) given an average daily demand of 50 units, a lead time of 10 days and 625 units on hand?

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Question added by Prabin Rai , inventory officer , bijaya motor
Date Posted: 2017/05/22
Arif Mahmood
by Arif Mahmood , Procurement Manager / Supply Chain Manager , Safety Assets Establishment for Trading & Contracting, www.safetyassets.net

Thanks to invite...!!

Place the order when you have left units in hand.

I agree with the answer of Mr. Awad.

I also agree with Mr. Nadeem Asghar's point of views to be considered at the time of re-ordering. 

Nadeem Asghar
by Nadeem Asghar , Supply Chain Consultant/Trainer , Independent Practitioner

I agree to both of above replies and would like to add the following as well from a reply given by Mostafa Abouelsaad to a very similar question earlier:  

Quote:

However you should also consider the following factors before ordering:

 

  • Is there a minimum order quantity for the needed units?
  • Is it a seasonal product?
  • Is your Purchasing budget enough for the needed units?

Unquote

Muhammad Farooq
by Muhammad Farooq , QA-QC MANAGER , AL Bawani contracting co.

Agreed with Awad  reply ------------

Mohammed Awad
by Mohammed Awad , Regional Supply Chain & Operations Director , Tamakkon Co.

You need to multiply 50 X 10 and take out the 625 unit so you will get it. 

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