1. What is Days of Supply (DOS)?

Days of Supply (DOS) is an inventory management metric that measures how many days current stock will last based on average daily usage. It helps businesses plan procurement and avoid stockouts.

2. How Does the Calculator Work?

The calculator uses the Days of Supply formula:

Where:

• \( DOS \) — Days of Supply (days)
• \( \text{On-Hand Inventory} \) — Current stock quantity (units)
• \( \text{Average Daily Usage} \) — Average consumption per day (units/day)

Explanation: The formula calculates the number of days until inventory depletion by dividing current stock by the average daily consumption rate.

3. Importance of DOS Calculation

Details: DOS is crucial for inventory optimization, preventing stockouts, reducing carrying costs, and improving cash flow management in supply chain operations.

4. Using the Calculator

Tips: Enter on-hand inventory in units and average daily usage in units per day. Both values must be positive numbers greater than zero.

5. Frequently Asked Questions (FAQ)

Q1: What is an ideal Days of Supply value?
A: Ideal DOS varies by industry and product, but typically ranges from 15-45 days depending on lead times, demand variability, and storage costs.

Q2: How is Average Daily Usage calculated?
A: Average daily usage is typically calculated by dividing total usage over a period (e.g., 30-90 days) by the number of days in that period.

Q3: When should DOS be recalculated?
A: DOS should be recalculated regularly, especially after significant sales, inventory counts, or when demand patterns change.

Q4: What are the limitations of DOS calculation?
A: DOS assumes constant demand and doesn't account for seasonality, promotions, or sudden demand spikes that may affect actual inventory duration.

Q5: How does DOS relate to reorder point?
A: DOS helps determine reorder points by indicating when to place new orders to maintain desired inventory levels throughout the supply lead time.