FORMULA FOR CALCULATING MIN MAX INVENTORY LEVELS
 

DOES ANY ONY HAVE THE FORMULA FOR CALCULATING MIN MAX LEVELS FOR INVENTORY
CONTROL

Answer: FORMULA FOR CALCULATING MIN MAX INVENTORY LEVELS
 

Yes, I can definitely help you with that! The formula for calculating minimum and maximum inventory levels is based on the reorder point and the economic order quantity (EOQ). Here are the steps to calculate the minimum and maximum inventory levels:

1. Determine the reorder point: This is the point at which you need to reorder inventory to avoid stockouts. The reorder point is calculated by multiplying the average daily usage by the lead time in days. For example, if you use an average of 10 units per day and the lead time is 5 days, the reorder point would be 50 units (
   Code:

   ---

   10 units/day x 5 days

   ---

   ).
   
2. Calculate the economic order quantity (EOQ): This is the optimal order quantity that minimizes the total cost of ordering and holding inventory. The formula for EOQ is:
   
   
   Code:

   ---

   EOQ = sqrt(2DS/H)

   ---

   Whe
   D = annual demand
   S = ordering cost per order
   H = holding cost per unit per year
   
3. Determine the minimum inventory level: The minimum inventory level is the safety stock that you need to hold to avoid stockouts while waiting for the next order to arrive. The formula for minimum inventory level is:
   
   
   Code:

   ---

   Minimum inventory level = reorder point - (average daily usage x lead time)

   ---

4. Determine the maximum inventory level: The maximum inventory level is the point at which you have enough inventory to meet demand until the next order arrives, without holding excess inventory. The formula for maximum inventory level is:
   
   
   Code:

   ---

   Maximum inventory level = EOQ + minimum inventory level

   ---

By using these formulas, you can calculate the minimum and maximum inventory levels for your inventory control system. This will help you maintain optimal inventory levels, reduce stockouts, and minimize holding costs. Let me know if you have any questions or need further assistance!

FORMULA FOR CALCULATING MIN MAX INVENTORY LEVELS
 

Not a lot of detail to go on in your question. Excel has a MIN and MAX
function that you can probably use... check it out in the help files (click
the fx button to the left of the Formula Bar, select All in the category
drop down box, select either MIN or MAX in the list that gets displayed and
then click the "Help on this function" link at the bottom of the dialog
box).

--
Rick (MVP - Excel)


"PAR80" wrote in message
...
DOES ANY ONY HAVE THE FORMULA FOR CALCULATING MIN MAX LEVELS FOR INVENTORY
CONTROL

FORMULA FOR CALCULATING MIN MAX INVENTORY LEVELS
 

If you are looking to set levels Kanban levels, there are several models on
some of the "Lean/Sigma" sites. A Lot of variables goes into these
calculations.

cil


"PAR80" wrote in message
...
DOES ANY ONY HAVE THE FORMULA FOR CALCULATING MIN MAX LEVELS FOR INVENTORY
CONTROL

FORMULA FOR CALCULATING MIN MAX INVENTORY LEVELS
 

Excel 2007
Using Kanban controls to minimize manufacturing buffer inventory.
With Monte Carlo method, regression, sensitivity analysis.
With macros and charts.
Ditto Cil.
http://c0444202.cdn.cloudfiles.racks...12_15_09a.xlsm