How to use the reorder point formula in your business
If you have at least one procurement cycle and one sales cycle worth of data.
Businesses with a limited number of products can start with excel spreadsheets and format cells to turn red when inventory levels reach the reorder point.
Working with dozens or hundreds of spreadsheets can be time-consuming and error-prone for growing retailers, manufacturers, or wholesalers. If your business falls into this category, consider the benefits of inventory management software.
A modern inventory management system can bring greater efficiency to inventory processes through automation and digital tools.
For example, real-time inventory tracking allows staff to see what’s in stock, what’s on order, and where each item is located. Software tools can also collect and present purchase orders, sales fulfilment, and demand forecasting data on a single-user dashboard.
This information prevents inventory managers from manually searching through spreadsheets and crunching numbers.
Some inventory management tools also enable businesses to generate customised reports on inventory stock. This can be done:
- By item
- By vendor
- By delivery date
- By assembly, and more
Rich inventory insights empower businesses to fine-tune their reorder points and overall inventory management processes.