Inventory Reorder Point Automation
Automated system that monitors stock levels and triggers reorder notifications or purchase orders when inventory drops below threshold. Prevents stockouts.
Steps
- 1
Stock Level Monitor
Scheduled check (daily or real-time webhook) queries inventory database for items below reorder point. Reorder point = average daily sales x lead time + safety stock.
Reorder Point Formula:\nROP = (Avg Daily Sales x Lead Time Days) + Safety Stock\nSafety Stock = Max Daily Sales x Max Lead Time - ROP
- 2
Demand Forecasting
Calculate 30/60/90 day moving average of sales. Identify seasonal patterns. Adjust reorder quantity based on trend.
- 3
Supplier Selection
For each item needing reorder, select preferred supplier based on: price, lead time, MOQ, and past quality score.
- 4
PO Generation
Generate purchase order with: item details, quantity (EOQ formula), requested delivery date, and payment terms.
EOQ = sqrt(2 x Annual Demand x Order Cost / Holding Cost)
- 5
Notification
Send PO to supplier via email. Notify purchasing manager via Slack/WhatsApp. Update inventory system with expected delivery date.
- 6
Follow-Up Schedule
Set automated follow-up: confirm receipt after 2 days, request tracking after 50% lead time, alert if overdue.
Tools Required
Estimated Monthly Cost
Free
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