1. What is Days of Supply?

Days of Supply (DOS) is a key inventory management metric that calculates how long current inventory levels will last based on average daily usage. It helps businesses plan for reordering and avoid stockouts.

2. How Does the Calculator Work?

The calculator uses the Days of Supply formula:

Where:

• \( DOS \) — Days of Supply (days)
• \( Inventory \) — Current inventory quantity (units)
• \( Daily\ Usage \) — Average daily consumption (units/day)

Explanation: This simple division gives you the number of days your current inventory will last at the current consumption rate.

3. Importance of Days of Supply Calculation

Details: DOS calculation is crucial for inventory optimization, cash flow management, supply chain planning, and ensuring continuous operations without excessive inventory carrying costs.

4. Using the Calculator

Tips: Enter current inventory quantity in units and average daily usage in units per day. Both values must be positive numbers (inventory ≥ 0, daily usage > 0).

5. Frequently Asked Questions (FAQ)

Q1: What is a good Days of Supply target?
A: Ideal DOS varies by industry and product, but typically 30-60 days is common for most businesses to balance availability and carrying costs.

Q2: How often should I calculate Days of Supply?
A: For optimal inventory management, calculate DOS weekly or monthly, and whenever there are significant changes in demand patterns.

Q3: What if daily usage varies significantly?
A: Use average daily usage over a relevant period (e.g., 30-90 days) and consider calculating safety stock separately for demand variability.

Q4: Can DOS be used for perishable goods?
A: Yes, but for perishables, DOS should be less than the product's shelf life to avoid spoilage and waste.

Q5: How does DOS relate to reorder point?
A: DOS helps determine reorder points - when DOS reaches your lead time plus safety stock days, it's time to reorder.