What is a reorder point?
The reorder point (ROP) is the inventory level that triggers a new purchase order. Formula: ROP = (Average Daily Sales × Lead Time in Days) + Safety Stock. When your stock reaches the ROP, you need to reorder immediately to avoid stockouts during lead time.
What should I use as my lead time for Amazon FBA?
For China-sourced products going to Amazon FBA via sea freight: total lead time is typically 45–75 days (production 15–30 days + sea transit 25–35 days + customs + prep + FBA receiving). Use 60 days as a conservative estimate if you don't have your own data.
How does safety stock affect the reorder point?
Safety stock is the buffer inventory you keep above your ROP to handle unexpected demand increases or supplier delays. More safety stock = higher ROP = you reorder earlier. Too much safety stock ties up capital; too little risks stockouts.
What happens if I miss my reorder point on Amazon?
Running out of stock on Amazon loses your sales history momentum, causes ranking drops (Amazon's algorithm rewards consistent sales velocity), and gives competitors time to capture your customers. Stockouts are expensive — chronic stockouts can cost 2–4x the lost revenue in recovered ranking costs.