In a business, stock will be received and consumed by customers. More stock will be received and more will be consumed. We see that a pattern or cycle starts to develop whereby stock is received and consumed. This cycle or time period between receipts is referred to as the Replenishment cycle.

An item’s Replenishment cycle is defined as the desired time-based plan for which received stock should cover future demand which in turn specifies the frequency of replenishment.

In simpler terms: Every time you order an item, you wish to order X many days worth, so it can last you X many days until you have to order the next batch of X many is delivered by the supplier. Every time stock is received for an item, you wish to have it cover X many days worth before the next batch of stock is received.

The Replenishment cycle is specified in days instead of units. It automatically converts to units by looking at the forecast. This means that a beach towel with a Replenishment cycle of 30 days will convert to more units over summer months than over winter months.

Refer to How do the replenishment cycle units get computed? for more.

Examples

What would the Replenishment cycle be if we sell 100 units a month and we order 200 units at a time?

Answer: 60 days

What would the Replenishment cycle be if we sell 100 units a month and we order 50 units at a time?

Answer: 15 days

The Replenishment cycle for an item will be specified by the app user.

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