Formulas and calculations for inventory management including reorder points, safety stock, and economic order quantity.
TL;DR Economic order quantity (EOQ) is the order size that minimizes the total cost of ordering and holding inventory. For Amazon FBA sellers, a standard EOQ calculation needs adjustment for FBA storage fees, aged inventory surcharges, and inbound placement costs. Getting this right means fewer wasted dollars sitting on warehouse shelves and fewer emergency reorders […]
TL;DR The reorder point formula tells you exactly when to place your next purchase order so inventory arrives before you stock out. The formula: (Average Daily Sales × Lead Time in Days) + Safety Stock. For most Amazon FBA sellers, the tricky part is getting accurate inputs, especially lead time, which needs to include FBA […]