FBA Reorder Date Calculation: When to Place the PO | Inventory Hero
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FBA Reorder Date Calculation: When to Place the PO
How to calculate your reorder date: the day to place a PO so stock arrives before you run out. The formula, a worked example, and the inputs that matter.
Place the order when your remaining days of supply falls to your total lead time plus your safety-stock days. If your lead time is 60 days and you hold 20 days of safety stock, you reorder when you have 80 days of supply left. In units, the reorder point is demand during the lead time plus safety stock, and you order when on-hand stock hits that number.
What is the difference between a reorder point and a reorder date?
A reorder point is a stock level in units; when your on-hand quantity drops to it, you order. A reorder date is the calendar day that level is projected to be reached, based on your sales velocity. They are two views of the same trigger: the reorder point tells you the quantity to watch for, and the reorder date tells you when you will hit it so you can plan the cash and the PO.
Andrew Erickson is the founder of Inventory Hero. He has spent years working with Amazon FBA sellers on demand forecasting, restock planning, and the cash flow side of running a private-label brand. Inventory Hero exists because every spreadsheet-based inventory system he tried eventually broke — usually right before Q4.
What inputs do I need to calculate a reorder date?
Three: your sales velocity (units per day, with out-of-stock days excluded so it is not understated), your total lead time (supplier plus freight plus Amazon receiving), and your safety stock (a buffer for demand and lead-time variability). An error in any one moves your reorder date, so measure each from real data rather than estimating.
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Your reorder date calculation answers one question: what is the day you have to place a purchase order so that replenishment arrives before you run out? The short version: you reorder when your remaining days of supply falls to your total lead time plus your safety-stock days, which is the same as saying you order when on-hand stock hits your reorder point in units. Below is the formula, a worked example, and the three inputs that decide the date.
You place the order when the stock you have left will just cover the time it takes new stock to arrive, plus a buffer. In days:
Reorder when: remaining days of supply = total lead time + safety-stock days
And the equivalent in units, the reorder point:
Reorder point = (daily sales velocity x total lead time) + safety stock
Both say the same thing. When your projected days of supply drops to your lead-time-plus-buffer figure, or equivalently your on-hand units hit the reorder point, it is time to order. Size the buffer with safety stock, and confirm the point in the reorder point calculator.
Take a SKU selling 10 units a day, a total lead time of 60 days, and 20 days of safety stock:
Input
Value
Sales velocity
10 units/day
Total lead time
60 days
Safety stock
20 days (200 units)
Reorder point
(10 x 60) + 200 = 800 units
Reorder trigger in days
60 + 20 = 80 days of supply
If you currently hold 900 units, that is 90 days of supply, so you are 10 days from the trigger: your reorder date is about 10 days out. Order then and the new stock arrives right as you draw down into the safety buffer, not after you have stocked out.
The reorder date is only as good as its inputs, so measure each from real data:
Sales velocity. Units per day, with out-of-stock days excluded so it is not understated. Pull it from your Business Reports. A velocity that is drifting up pulls the reorder date forward.
Total lead time.Supplier lead time plus freight plus Amazon receiving. This is usually the biggest and most variable input. The 60 days in the example is on the low side for overseas sourcing; China-sourced totals often land at 65 to 85 days once production, ocean freight, and check-in are added, so measure yours rather than assuming.
Safety stock. Your buffer for demand spikes and lead-time variability. Too little and normal variation stocks you out; too much and you tie up cash. For a supplier with moderate variability, 15 to 30 days is a common starting range; size it properly with the safety stock method rather than guessing.
An error in any one moves the date, so the discipline is to keep all three current rather than setting them once and forgetting.
A reorder point in units works, but converting it to a date is what makes it manageable at scale:
You can plan the cash. Knowing a large reorder is due in two weeks lets you line up the funds, and the payment terms structure, against your cash flow, not discover the need the day stock hits the point.
You can batch POs. Seeing several SKUs from one supplier reaching their reorder dates near each other lets you consolidate a shipment.
You get a warning, not an alarm. A date gives you lead time on the decision; a point that trips today gives you none.
The calculation assumes steady velocity, so for seasonal SKUs, use the velocity you expect during the lead-time window, not the trailing average. Run the earlier example forward: if your trailing rate is 10 a day but Q4 historically runs at 18, then your 900 units on hand is only 50 days of supply at the Q4 pace, not 90, which is already past the 80-day trigger. On the seasonal rate you should have ordered weeks ago. That gap is why reordering on a flat trailing average is how sellers stock out right as their season starts. See restock planning for handling the seasonal build.
Four errors put the date in the wrong place, and each one causes a stockout that looks like bad luck:
Using the quoted lead time. Planning on the factory's optimistic quote rather than your measured actual sets the date too late. Use your supplier lead time history.
Averaging velocity through stockout days. If out-of-stock days are in your velocity denominator, the number is understated, days of supply reads long, and you reorder late. Exclude them.
Forgetting Amazon receiving. Total lead time includes check-in and stow at the fulfillment center, which can add days to weeks. Leave it out and stock is "arrived" on paper but not sellable.
One flat date for a seasonal SKU. A trailing average ignores the ramp; the reorder date for Q4 demand has to be pulled forward, often by weeks.
Each of these is a systematic bias toward ordering late, which is why measuring the inputs beats estimating them.
The reorder date is the day your remaining days of supply hits your lead time plus safety stock, the same trigger as your unit reorder point seen on a calendar. Compute it from real velocity, total lead time, and safety stock, keep those inputs current, and pull the date earlier for seasonal ramps. Working in dates rather than points is what lets you fund and place POs before a stockout, not after. For the wider system, see when to reorder inventory.