You can set Reorder points for products and materials on the Variant screen.
Navigate to the Variant screen.
Click on the Sales / Reordering for the product or material you want to set a Reorder Point for.
Enter the desired Min and Max.
Minimum Level (Min):
This is the lowest level of inventory that must be maintained to avoid stockouts and production halts. When the inventory level falls to this point, it triggers a reorder signal.
The minimum level is determined based on factors like lead time (the time between placing the reorder and receiving the goods), average daily usage rate, and buffer stock to cater to any unexpected increase in demand or delays in supply.
Maximum Level (Max):
This is the upper limit of inventory that a company should maintain. Holding inventory beyond this level can lead to increased holding costs, potential wastage, and issues related to space and management.
The maximum level is calculated considering factors like storage capacity, capital tied up in inventory, spoilage risk for perishable items, and the cost of holding inventory.
If you do not know what the MAX value is, you can set the MIN and MAX the same.
If you wish to use the advanced reordering, read more here.
If a product's inventory level falls below the minimum threshold, it will be flagged for reordering. The specific action taken will depend on whether the item is purchased and has a default vendor associated with it, or if the product is produced in-house.
For purchased items with a default vendor, they will appear in the Reorder report found in the Purchase Section. For products produced in-house, they will appear in the Make-to-Stock Report.