Reorder Policies

Automate inventory replenishment with min/max policies and reorder point suggestions

Overview

Reorder Policies automate inventory planning by defining minimum and maximum stock levels per part and warehouse. The system generates reorder suggestions when available stock falls below the reorder point.

Policy Structure

Each reorder policy defines:

Field	Type	Description
part_id	UUID	Part to manage
warehouse_id	UUID	Warehouse location
min_qty	number	Minimum stock level (required)
max_qty	number	Maximum stock level (optional)
reorder_point	number	Trigger level (optional, defaults to min_qty)
safety_stock	number	Buffer quantity (optional)
lead_time_days	number	Procurement lead time (optional)
preferred_vendor_id	UUID	Preferred supplier (optional)

Policies are unique per (part_id, warehouse_id) combination. Creating a duplicate updates the existing policy.

Accessing Reorder Policies

Navigate to Inventory > Políticas de reposición (/inventory/reorder) to manage policies.

Requires inventory:read to view. Creating/editing requires inventory:full_access.

Creating a Policy

1. Open Policy Dialog

   Click Nueva política in the policies page.

2. Select Part

   Choose the part to manage:

   • Filter by category for easier selection
   • Search by part code or name
3. Select Warehouse

   Choose the warehouse location for this policy.

   Each part can have different policies per warehouse. For example, critical parts may have higher minimums at main facility vs. remote sites.

4. Set Minimum Quantity

   Enter the minimum stock level:

   min_qty = Minimum acceptable stock before reorder
   

   Consider:

   • Average daily/weekly usage
   • Lead time to replenish
   • Part criticality
   • Storage constraints
5. Set Maximum Quantity (Optional)

   Enter the maximum stock level:

   max_qty = Target stock after reorder
   

   Leave blank if no upper limit needed.

6. Configure Reorder Point (Optional)

   Set a different trigger than min_qty:

   reorder_point = Trigger for reorder suggestion
   

   Typically:

   reorder_point = min_qty + (lead_time_usage)
   

   If not set, system uses min_qty as trigger.

7. Add Safety Stock (Optional)

   Buffer for demand variability:

   safety_stock = Extra quantity to cover uncertainty
   

   Consider:

   • Demand variability
   • Lead time reliability
   • Criticality
   • Cost of stockout
8. Enter Lead Time (Optional)

   Days to receive after ordering:

   lead_time_days = Procurement + delivery time
   
9. Select Preferred Vendor (Optional)

   Choose default supplier for this part/warehouse.

10. Save Policy

    Click Guardar to create or update the policy.

Policy Types

Min Only

Minimum Quantity Policy

Simplest policy:

min_qty = 10
max_qty = null
reorder_point = null (uses min)

Behavior:

• Alert when available < 10
• Suggest reorder to bring to min
• No upper limit guidance

Best for: Low-value, non-critical parts

Min/Max

Min/Max Policy

Classic reorder:

min_qty = 10
max_qty = 50
reorder_point = null (uses min)

Behavior:

• Alert when available < 10
• Suggest ordering to max (50)
• Order quantity = max - available

Best for: Standard consumables with predictable usage

Reorder Point

Reorder Point Policy

Earlier trigger:

min_qty = 5
max_qty = 40
reorder_point = 15

Behavior:

• Alert when available < 15
• Order before reaching minimum
• Accounts for lead time

Best for: Parts with long lead times

Safety Stock

Safety Stock Policy

Buffer for variability:

min_qty = 10
max_qty = 50
reorder_point = 20
safety_stock = 5

Behavior:

• Reorder at 20
• Target max of 50
• Maintain 5 as cushion
• Never go below safety stock

Best for: Critical parts with variable demand

Reorder Quantity Calculation

When a suggestion is generated:

// If max_qty is defined:
order_qty = max_qty - available_qty

// If only min_qty:
order_qty = min_qty - available_qty

// With safety stock:
order_qty = max_qty - available_qty + safety_stock

Example:

Policy:
  min_qty = 10
  max_qty = 50
  reorder_point = 20
  safety_stock = 5

Current Stock:
  on_hand = 15
  reserved = 3
  available = 12

Trigger: available (12) < reorder_point (20) ✓

Suggested Order:
  order_qty = max_qty - available + safety_stock
  order_qty = 50 - 12 + 5
  order_qty = 43 units

Reorder Suggestions

View automated suggestions at Inventory > Políticas de reposición → Sugerencias button, which navigates to /inventory/reorder_suggestions.

Suggestion View (v_reorder_suggestions)

Shows parts that need reordering:

Column	Description
Part	Part code and name
Warehouse	Storage location
Available	Current available quantity
Reorder Point	Trigger level
Min/Max	Min and max quantities
Suggested Qty	Recommended order amount
Vendor	Preferred supplier
Lead Time	Days to receive

Filtering:

• By warehouse
• By part category
• By criticality
• By vendor

Suggestions are calculated in real-time based on current available stock (on_hand - reserved).

Service Functions

Policy operations:

import {
  listReorderPolicies,
  upsertReorderPolicy,
  updateReorderPolicy,
  deleteReorderPolicy
} from '@/services/inventory/reorderPoliciesService';

// List policies for warehouse
const policies = await listReorderPolicies(warehouseId);

// Create or update policy (upsert by part+warehouse)
const policy = await upsertReorderPolicy({
  part_id: partId,
  warehouse_id: warehouseId,
  min_qty: 10,
  max_qty: 50,
  reorder_point: 20,
  safety_stock: 5,
  lead_time_days: 7,
  preferred_vendor_id: vendorId
});

// Update existing policy
await updateReorderPolicy(policyId, {
  min_qty: 15,
  reorder_point: 25
});

// Delete policy
await deleteReorderPolicy(policyId);

Policy Planning Workflow

1. Analyze Historical Usage

   Review past consumption:

   • Average daily/weekly usage
   • Usage variability (standard deviation)
   • Seasonal patterns
   • Trend analysis
2. Determine Lead Time

   Research procurement time:

   • Vendor lead time
   • Approval process
   • Shipping time
   • Receiving/inspection time

   total_lead_time = order_to_delivery_days
   
3. Calculate Safety Stock

   Buffer for uncertainty:

   safety_stock = Z × σ × √L
   
   Where:
   Z = Service level factor (1.65 for 95%, 2.33 for 99%)
   σ = Standard deviation of daily demand
   L = Lead time in days
   

   Example:

   Daily usage: 5 ± 2 units (σ = 2)
   Lead time: 10 days
   Service level: 95% (Z = 1.65)
   
   safety_stock = 1.65 × 2 × √10
   safety_stock = 1.65 × 2 × 3.16
   safety_stock ≈ 10 units
   
4. Set Reorder Point

   When to trigger order:

   reorder_point = (avg_daily_usage × lead_time_days) + safety_stock
   

   Example:

   Average daily usage: 5 units
   Lead time: 10 days
   Safety stock: 10 units
   
   reorder_point = (5 × 10) + 10
   reorder_point = 60 units
   
5. Set Minimum Quantity

   Absolute minimum acceptable:

   min_qty = safety_stock (or slightly above)
   
6. Set Maximum Quantity

   Consider:

   • Economic order quantity (EOQ)
   • Storage capacity
   • Shelf life
   • Capital constraints

   max_qty = reorder_point + order_qty
   
7. Create Policy

   Enter all calculated values into the system.

8. Monitor and Adjust

   Review periodically:

   • Quarterly for standard parts
   • Monthly for critical parts
   • After major usage changes
   • After lead time changes

Economic Order Quantity (EOQ)

Optimal order quantity to minimize total cost:

EOQ = √((2 × D × S) / H)

Where:
D = Annual demand
S = Order cost per order
H = Holding cost per unit per year

Example:

Annual demand: 1,200 units
Order cost: $50 per order
Holding cost: $2 per unit per year

EOQ = √((2 × 1200 × 50) / 2)
EOQ = √(120,000 / 2)
EOQ = √60,000
EOQ = 245 units

Orders per year: 1200 / 245 ≈ 5 orders

Use EOQ to inform max_qty setting.

ABC Analysis

Prioritize policies by part value/importance:

A Items (Critical)

High Value / High Importance

~20% of parts, ~80% of value

Policy:

• Tight control
• Lower safety stock (cost)
• Frequent review
• Accurate forecasting
• Preferred vendors

Example:

Critical pump impeller:
min_qty = 2
max_qty = 5
reorder_point = 3
safety_stock = 1
lead_time_days = 14

B Items (Moderate)

Moderate Value / Importance

~30% of parts, ~15% of value

Policy:

• Standard control
• Normal safety stock
• Quarterly review
• Good forecasting

Example:

Standard bearing:
min_qty = 10
max_qty = 40
reorder_point = 20
safety_stock = 5
lead_time_days = 7

C Items (Low Priority)

Low Value / Low Importance

~50% of parts, ~5% of value

Policy:

• Loose control
• Higher safety stock (cheap)
• Annual review
• Simple min/max

Example:

Consumable fasteners:
min_qty = 100
max_qty = 500
reorder_point = null (use min)
safety_stock = 50
lead_time_days = 3

Best Practices

Start Simple

Begin with min/max only:

• Easier to understand
• Less data required
• Refine over time
• Add complexity as needed

Use Historical Data

Base decisions on actual usage:

• Review past 6-12 months
• Account for seasonality
• Identify trends
• Validate with stakeholders

Regular Reviews

Schedule policy audits:

• A items: Monthly
• B items: Quarterly
• C items: Annually
• After major changes

Document Rationale

Record policy reasoning:

• Calculation methods
• Assumptions made
• Data sources
• Review dates

Integration with Procurement

Reorder suggestions drive procurement workflow:

1. Generate Suggestions

   System calculates nightly or on-demand based on available stock.

2. Review Suggestions

   Procurement team reviews list:

   • Verify quantities
   • Check budget
   • Confirm lead times
   • Consolidate orders
3. Create Purchase Orders

   Generate POs:

   • Use preferred vendors
   • Combine parts from same supplier
   • Negotiate pricing
   • Submit orders
4. Track Orders

   Monitor incoming:

   • Expected delivery dates
   • Track shipments
   • Prepare receiving
5. Receive Stock

   Process RECEIPT documents:

   • Reference PO number
   • Verify quantities
   • Enter unit costs
   • Update stock

Related Topics

Stock Management

View current stock levels that trigger policies

Documents

Create receipts from purchase orders

Parts

Set part criticality and attributes

Warehouses

Manage locations for policies