In this post, I will make a few examples again, using different Reordering Policy for the same case. Before each example, I will put conditions and I will make actual demand with Sales Order.

Minimum Order Quantity > Reorder Quantity & Maximum Inventory > Sales Order Quantity

Reordering Policy

Fixed Reorder Qty.

Maximum Qty.

Order

Lot-for-Lot

Inventory Stock

0

0

0

0

Sales Order Quantity

500

500

500

500

Sales Order Date

-

-

-

-

Safety Stock Quantity

50

50

-

-

Reorder Point

100

100

-

-

Reorder Quantity

1.000

-

-

-

Maximum Inventory

-

1.000

-

-

Minimum Order Quantity

2.000

2.000

-

2.000

Maximum Order Quantity

5.000

5.000

-

5.000

Order Multiple

1

1

-

1

Quantity on Demand

2.050

2.050

500

2.000

Due Date

0D

0D

+10D

+10D

Fixed Reorder Qty.:

  • Quantity on Demand = Minimum Order Quantity + Safety Stock Quantity
  • Due Date = the same date

Maximum Qty.:

  • Quantity on Demand = Minimum Order Quantity + Safety Stock Quantity
  • Due Date = the same date

Order:

  • Quantity on Demand = Sales Order Quantity
  • Due Date = Sales Order Date

Lot-for-Lot:

  • Quantity on Demand = Minimum Order Quantity
  • Due Date = Sales Order Date

This is the same result as Minimum Order Quantity > Sales Order Quantity > Reorder Quantity & Maximum Inventory.

Minimum Order Quantity < Maximum Order Quantity < Reorder Quantity & Maximum Inventory < Sales Order Quantity

Reordering Policy

Fixed Reorder Qty.

Maximum Qty.

Order

Lot-for-Lot

Inventory Stock

0

0

0

0

Sales Order Quantity

5.000

5.000

5.000

5.000

Sales Order Date

-

-

-

-

Safety Stock Quantity

50

50

-

-

Reorder Point

100

100

-

-

Reorder Quantity

1.000

-

-

-

Maximum Inventory

-

1.000

-

-

Minimum Order Quantity

150

150

-

150

Maximum Order Quantity

500

500

-

500

Order Multiple

1

1

-

1

Quantity on Demand / Due Date

1.050 /     0D

1.000 /     0D

5.000 / +10D

5.000 / +10D

4.000 / +10D

4.050 / +10D

 

(10 x 500)

1.000 / +11D

950 / +11D

 

 

Fixed Reorder Qty.:

  • Quantity on Demand = (Reorder Quantity + Safety Stock Quantity) + (Sales Order Quantity – Reorder Quantity) + Reorder Quantity
  • Due Date = the same date / Sales Order Date / Sales Order Date+1

Maximum Qty.:

  • Quantity on Demand = Maximum Inventory + (Sales Order Quantity – Maximum Inventory + Safety Stock Quantity) + (Maximum Inventory - Safety Stock Quantity)
  • Due Date = the same date / Sales Order Date / Sales Order Date+1

Order:

  • Quantity on Demand = Sales Order Quantity
  • Due Date = Sales Order Date

Lot-for-Lot:

  • Quantity on Demand = Sales Order Quantity [Maximum Order Quantity x n]
  • Due Date = Sales Order Date