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design-details-the-role-of-the-reorder-point.md

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title description documentationcenter author ms.prod ms.topic ms.devlang ms.tgt_pltfrm ms.workload ms.search.keywords ms.date ms.author ms.translationtype ms.sourcegitcommit ms.openlocfilehash ms.contentlocale ms.lasthandoff
Design Details - The Role of the Reorder Point
This topic highlights the importance of setting a reorder point, so that you when to order more inventory.
SorenGP
dynamics-nav-2018
article
na
na
na
desigh, reorder, demand, supply
07/01/2017
sgroespe
HT
4fefaef7380ac10836fcac404eea006f55d8556f
8035a670077e53981e9c366d22bdb20df06d8c1b
en-gb
10/16/2017

Design Details: The Role of the Reorder Point

In addition to the general balancing of supply and demand, the planning system must also monitor inventory levels for the affected items to respect the defined reordering policies.

A reorder point represents demand during lead time. When the projected inventory passes below the inventory level defined by the reorder point, it is time to order more quantity. Meanwhile, the inventory is expected to decrease gradually and possibly reach zero (or the safety stock level), until the replenishment arrives.

Accordingly, the planning system will suggest a forward-scheduled supply order at the point when the projected inventory passes below the reorder point.

The reorder point reflects a certain inventory level. However, inventory levels can move significantly during the time bucket and, therefore, the planning system must constantly monitor the projected available inventory.

See Also

Design Details: Reordering Policies
Design Details: Planning Parameters
Design Details: Handling Reordering Policies
Design Details: Supply Planning