Describing reorder point problem

How much to order when and which replenishment policy to use for which product and questions of similar nature are asked all the time among folks responsible for managing operations at a distribution center or in a manufacturing plant. The problem is well-understood but not necessary simple. Choices are many.

Here is a short deck that you can use to see different scenarios and how they impact KPIs. You can use this to communicate with your team.

If you use Dynamics 365 for Operations, you can setup various policies for your product replenishment - some of which are described in this document.

Its interesting to see side-by-side comparison of various policies for a simple scenario to appreciate the nature of conflicting objectives a demand planner has.