How order quantities are calculated

Owned by Carolynne Robertson-Dunn (Deactivated)
Last updated: Apr 08, 2019 by Peter Drill
2 min read

Readysell calculates the quantities of products to order based on the information on the Products screen and the type of purchase run you are doing.

Note:

  • If the net quantity on hand for a product is below 0, the product will always be ordered.
  • If Readysell calculates that an order is needed, the quantity to order will always be at least 1.

Average Weekly Sales

Overview

First, Readysell calculates the stock required for an average week's sales, based on a set of criteria entered in the purchase run set. If the stock required is less than the quantity on hand, Readysell will reorder the product.

Calculating the stock required

Readysell calculates three values:

  • The average quantity of stock sold per week, multiplied by the Weeks of Floor Stock defined in the purchase run set.
  • The quantity of weekly shipments.
  • The quantity of stock on sales back order.

The Stock Required is set to the largest of these.

Calculating whether to reorder

Readysell will reorder the product if all of these are true:

  • The net quantity on hand is less than the amount of stock required.
  • The average number of sales per week over the specified period is greater than (or equal to) the minimum weekly sales count defined in the purchase run set.
  • The average quantity of product sold over the specified period is greater than (or equal to) the minimum weekly sales quantity defined in the purchase run set.

Calculating the quantity to order

Readysell calculates the amount of stock required, then subtracts the net quantity on hand. This is the quantity that will be ordered. If this is less than the minimum order quantity for the supplier, then the minimum order quantity will be ordered.

Compensating for lead time

If Readysell is already ordering stock from a supplier (based on the other rules in the purchase run), Readysell will use the following formula to add on additional stock to compensate for the fact that a supplier will take some time to send out that stock (and in the mean time, your stock will continue to reduce).
Additional Stock = (Original Stock To Order) x (Supplier Lead Time) / (Days Per Week Supplier Operates) / (Weeks of Floor Stock Requested)

Min/Max

Overview

Readysell calculates the amount to reorder based on the minimum and maximum quantities set for the product.

Calculating whether to reorder

If the net quantity on hand is below the minimum reorder quantity, the product will be ordered.

Calculating the quantity to order

Readysell calculates the amount of stock required, then subtracts the net quantity on hand. This is the quantity to order. However:

  • If this is greater than the maximum reorder quantity, the maximum reorder quantity will be ordered.
  • If this is less than the minimum order quantity for the supplier, then the minimum order quantity will be ordered.