The reorder level is defined as the sum of the safety stock plus the requirement forecast within the replenishment lead time (see formula (17)).
A forecast was carried out on a monthly basis. A month has 30 days in the case of external procurement.
Safety stock | 100 | |
Forecast | 1st subsequent period | 200 |
| 2nd subsequent periode | 00 | |
| 3rd subsequent period | 400 | |
Replenishment lead time | 40 days | 0/30 |
| 30/30 + 10/30 |
(an entire monthly requirement + a part of the the following month)
Reorder level = 100 + 30/30 * 200 + 10/30 * 300 = 400
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