Min-Max Planning
Definition
A simple replenishment method where an order is triggered when inventory falls to a minimum level and stock is replenished up to a maximum level. The min acts as the reorder point and the max caps the order-up-to quantity.
In Practice
Min-max is the workhorse policy for items that do not justify sophisticated planning. When inventory position drops to or below the min, the system orders enough to bring it back to the max. The min is set like a reorder point, demand during lead time plus safety stock, while the max adds a sensible cycle stock on top.
Its appeal is transparency and low maintenance: a storeroom clerk can understand and audit it. Its weakness is rigidity, since static min and max values drift out of date as demand changes, so a periodic recalculation routine, even quarterly, keeps the policy healthy.
Example: a maintenance storeroom sets a min of 12 and max of 36 on hydraulic filters that are used about 2 per week with a 3-week lead time. When stock hits 12, the system orders 24. After a new production line doubles usage, the planner recalculates to min 24, max 60.
Related Calculators
Related Terms
The inventory level that triggers a replenishment order. It equals expected demand during supplier lead time plus safety stock.
Continuous ReviewAn inventory policy where stock is monitored constantly and a fixed quantity is ordered whenever inventory falls to the reorder point. Order quantity is fixed while order timing varies with demand.
Periodic ReviewAn inventory policy where stock levels are checked at fixed intervals and an order is placed to raise inventory to a target level. Order timing is fixed while order quantity varies.
ReplenishmentThe process of restocking inventory to meet ongoing demand, whether by purchasing from suppliers, transferring between locations, or triggering production. It is the execution engine that keeps stock policies real.