Minimum Stock Level
Lowest inventory quantity; triggers reordering.
Formula
Minimum Stock Level = (Maximum Daily Usage × Maximum Lead Time) − (Average Daily Usage × Average Lead Time)
Real World
A Greggs bakery sets a minimum flour stock of three days' supply; if stock falls to that level a reorder is triggered so production never halts due to a supplier delay.
Exam Focus
Show your working when calculating minimum stock level — examiners award method marks even if the final answer is wrong.
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