🧠 Understanding the Core Concepts
Reorder Quantity
Reorder Quantity refers to the amount of inventory that should be ordered when stock levels fall below a set threshold — the Reorder Point.
Its goal is to ensure there’s always enough stock to meet demand while avoiding unnecessary overstocking.
Formula:
Reorder Quantity = Maximum Stock Level − Current Inventory Level
Example:
Maximum Stock Level: 500 units
Current Inventory Level: 300 units
→ Reorder Quantity = 500 − 300 = 200 units
You would need to order 200 units to bring your inventory back to its maximum level.
Maximum Stock Level
The Maximum Stock Level represents the highest stock quantity you want to maintain. It ensures you can meet demand efficiently without exceeding storage capacity or increasing holding costs.
Formula:
Maximum Stock Level = Reorder Point + Order Quantity − Minimum Threshold (Safety Stock)
Where:
Reorder Point (ROP): The inventory level at which a new order should be placed to avoid running out of stock.
Order Quantity: The amount you typically reorder each time.
Minimum Threshold (Safety Stock): Buffer stock kept to prevent stockouts due to fluctuating demand or delayed supply.
Example:
Reorder Point (ROP): 500 units
Order Quantity: 400 units
Minimum Stock Level (Safety Stock): 100 units
→ Maximum Inventory Level = 500 + 400 − 100 = 800 units
You should maintain a maximum of 800 units to cover variability and holding capacity limits.
Reorder Point (ROP)
The Reorder Point tells you when to place your next order so that new stock arrives before you run out.
Formula:
ROP = (Demand per Period × Lead Time) + Minimum Threshold (Safety Stock)
Where:
Demand per Period = Average daily demand
Lead Time = Time required to receive the new order
Minimum Threshold (Safety Stock) = Extra inventory held to cover uncertainty in demand or supply
⚙️ Calculation in the App
The Reorder Quantity Report in your app supports two modes — Manual Mode and Dynamic Mode — giving users full flexibility in how reorder metrics are computed.
🧩 Manual Mode
In Manual Mode, you input your own estimates and thresholds.
This mode is ideal for stores that already know their internal targets.
User Inputs:
Estimated Daily Demand
Minimum Threshold (Safety Stock)
Lead Time (Days)
Maximum Order Quantity
Users can apply:
Same for All Items, or
Different Thresholds for each item.
Formulas:
Reorder Point = (Estimated Daily Demand × Lead Time) + Minimum Threshold (Safety Stock)
Maximum Stock Level = Reorder Point + Maximum Order Quantity - Minimum Threshold (Safety Stock)
Reorder Quantity = Maximum Stock Level − Current Inventory
Example:
Estimated Daily Demand: 5 units/day
Lead Time: 10 days
Minimum Threshold: 20 units
Maximum Order Quantity: 100 units
Current Inventory: 70 units
→ Reorder Point = (5 × 10) + 20 = 70
→ Maximum Stock Level = 70 + 100 - 20 = 150
→ Reorder Quantity = 150 − 70 = 80 units
🤖 Dynamic Mode
In Dynamic Mode, the system uses Shopify data to automate calculations.
It analyzes real sales and stock data to compute demand and safety stock with minimal manual entry.
User Inputs:
Base Period (default: 30 days)
Lead Time (Days)
Maximum Order Quantity
System-Generated Parameters:
Parameter | Source / Logic |
|---|---|
Average Daily Demand | Calculated from Shopify sales in units (default: last 30 days). |
Maximum Daily Demand | Highest daily unit sales within the base period. |
Minimum Threshold (Safety Stock) | Auto-calculated: (Max Daily Demand × Max Lead Time) − (Average Daily Demand × Average Lead Time) |
Max Lead Time | Default: 30 days |
Average Lead Time | Default: 15 days |
Formulas Used:
Minimum Threshold (Safety Stock) = (Max Daily Demand × 30) − (Average Daily Demand × 15)
Reorder Point = (Average Daily Demand × Lead Time) + Minimum Threshold (Safety Stock)
Maximum Stock Level = Reorder Point + Maximum Order Quantity - Minimum Threshold (Safety Stock)
Reorder Quantity = Maximum Stock Level − Current Inventory
Example:
Max Daily Demand = 8 units/day
Average Daily Demand = 5 units/day
Lead Time = 10 days
Maximum Order Quantity = 100 units
Current Inventory = 80 units
→ Minimum Threshold Safety Stock = (8 × 30) − (5 × 15) = 165
→ Reorder Point = (5 × 10) + 165 = 215
→ Maximum Stock Level = 215 + 100 - 165 = 150
→ Reorder Quantity = 150 − 80 = 70 units
📊 Report Output Columns
Column | Description |
|---|---|
Product Name | Product title from Shopify |
Collections | Product collections |
SKU | Stock Keeping Unit |
Tags | Product tags |
Vendor | Supplier or brand |
Current Inventory | Current stock in Shopify |
Maximum Inventory | Calculated Maximum Stock Level |
Reorder Point | The stock level where reorder is triggered |
Reorder Quantity | The number of units to order to reach maximum stock level |
💬 Why It Matters
The Reorder Quantity Report provides merchants with clear, data-backed insight into their stock performance. By understanding and acting on these metrics, you can:
Prevent stockouts and maintain steady sales.
Reduce overstocking and holding costs.
Make strategic restocking decisions based on real data.
Save time with automated, accurate calculations.
Whether you prefer manual control or automated precision, this report ensures your Shopify store always maintains the right inventory, at the right time, and in the right quantity.