Retail replenishment software answers the daily question of what to reorder and how much: it compares what is on hand, on order and in transit against how fast each item sells and how long the supplier takes, and produces a suggested order that a buyer reviews before it goes out. With Pentoggle, a retailer can describe how reordering actually works in their store and generate the starting application around it.
This page is about regular replenishment of items the store sells continuously. Predicting demand for seasonal ranges, new products and promotions, where there is no steady sales history to work from, is Retail Inventory Forecasting Software. Handling the order once the decision is made is Retail Purchase Management Software. The stock figure replenishment reads from is Retail Inventory Management Software.
Most retailers already run an accounting system such as QuickBooks, Tally or Xero, and a POS that records what sells. Those stay where they are. What is often still managed outside them is the reorder decision: which items are close to running out, how much to order given what is already coming, and when the order has to be placed to arrive in time.
Key takeaways
- A reorder point is a days-of-cover threshold in disguise: enough stock to last through the supplier's lead time, plus a margin for the weeks that sell faster than average.
- The inputs are usually the problem, not the rule. A reorder point calculated from a wrong stock figure, a stale lead time or a sales rate that ignores the last promotion produces a confident wrong answer.
- Stock on order and in transit have to be counted as available. A store that reorders on shelf stock alone tends to over-order whenever a delivery is already on its way.
- Replenishment is a review, not an automation. The suggested order is a starting point for a buyer who knows about the trade show next month and the supplier who is about to raise prices.
- A useful number is items below their reorder point with nothing on order.
The spreadsheet is often not the problem
A buyer who walks the store on Monday, notes what looks low and places orders on Tuesday is running a working system for a small store, and many run one for years without a stockout that matters.
The trouble starts at identifiable points.
When the walk misses the back store
The shelf looks low. The back store has two cartons. The order goes out anyway, and the item is now over-stocked for two months.
When the lead time has changed
The reorder was timed for a supplier who used to deliver in four days. They now take nine. The order is placed at the same point as before and the shelf is empty for the last five days of every cycle.
When the sales rate is a memory
The buyer knows the item sells well. It sold well in the run-up to a holiday. The order is sized to that rate for the quiet month that follows.
When items are many and buyers are few
A store with several thousand items cannot be walked. The fast sellers get attention, the middle of the range gets reordered when a customer asks, and the stockouts are on items nobody was watching.
What retail replenishment software holds
Reorder parameters per item and location
Reorder point, target or maximum level, minimum order quantity and pack size, held per item per store or warehouse, with the date they were last reviewed.
Sales velocity
Average daily or weekly sales per item per location, calculated from actual sales over a window, with the option to exclude promotional periods or unusual weeks.
Available stock
On hand, on order and in transit, combined into the figure the reorder decision compares against.
Lead time
Days from order to receipt per supplier and, where it differs, per item, from the supplier record and updated from actual receipts.
Suggested orders
Per item, the quantity the parameters and the current position suggest, grouped by supplier and rounded to pack sizes and minimums.
Review and adjustment
The buyer's view of the suggestion with the reasons behind it, adjustable on a phone, with a record of what was changed and why.
Approved orders
The reviewed list converted into purchase orders per supplier, passed to purchasing.
Exceptions
Items below reorder point with nothing on order, items above target with orders still open, and items whose parameters have not been reviewed for a long time.
A reorder point is a days-of-cover threshold
The reorder point for an item is the stock level at which an order has to be placed for the new stock to arrive before the old stock runs out. Stated that way, it is a simple product of two things: how fast the item sells and how long the supplier takes.
If an item sells three a day and the supplier takes seven days, the store needs at least twenty-one on hand when it orders. Add a margin for the weeks that sell faster than average and for the deliveries that arrive late, and the reorder point is somewhere above that. The target level, the amount to order up to, is set by how often the store wants to order and how much it wants to hold.
The point of describing it plainly is that the calculation is not the hard part. Any spreadsheet can do it. What the spreadsheet cannot do is keep the inputs current across thousands of items: the sales rate for each, the lead time for each supplier, the stock on hand and on order for each location, and the pack sizes and minimums that turn a suggested 23 into an order of 24.
The application's job is to hold those inputs, keep them updated from what actually happens, apply the rule to every item every day, and show the buyer only the items where the answer is "order now" or "something looks wrong."
The inputs are usually the problem
When replenishment produces bad orders, the rule is rarely what is wrong. The inputs are.
The stock figure is the first suspect. A reorder point compared against a stock figure that is wrong by a carton produces an order that is early or late by a carton. Replenishment depends on stock accuracy, and a store whose counts regularly find large variances should fix that before trusting a reorder report. The stock figure also has to include what is on order and in transit; a delivery already on its way is stock the store will have, and ignoring it is the most common cause of over-ordering.
The lead time is the second. It is usually entered once, when the supplier is set up, and rarely revisited. Real lead times drift, and a wrong lead time shifts every reorder point for that supplier. Calculating actual lead time from purchase orders and receipts, and flagging where it differs from the figure in use, keeps this input honest.
The sales rate is the third. A rate calculated over a window that includes a promotion, a holiday or a stockout is a rate for a period that has ended. The window should be long enough to smooth ordinary variation and short enough to reflect the current run rate, and it should be possible to exclude periods that were not normal. A stockout period deserves particular care: an item that sold zero because it was out of stock did not have zero demand.
Pack sizes and minimums are the fourth. A suggestion of 23 units for an item that comes in cases of 12 has to become 24, and an order to a supplier with a minimum order value may need to be padded or held until it is worth placing. These are constraints the application should apply before the buyer sees the list, not corrections the buyer has to make by hand.
Replenishment is a review, not an automation
The suggested order is the beginning of the buyer's work, not the end of it.
A buyer knows things the sales history does not. That a competitor is opening across the road. That the supplier has warned of a price rise next month, which makes this a good month to order more. That a local event will empty the shelves of one category next weekend. That a range is being discontinued and should be run down rather than replenished. None of that is in the data yet, and a system that places orders without a person seeing them will order confidently into all of it.
The useful design is a review screen that shows each suggestion with its reasons, on hand, on order, velocity, lead time and the resulting quantity, and lets the buyer adjust with a note. The note matters: a record of why the buyer overrode the suggestion is how the parameters get better over time, and how a new buyer learns what the old one knew.
It is also how the store can see where the rule and the buyer disagree most. If the buyer overrides the suggestion for one supplier every week, either the lead time is wrong or the buyer knows something the record should hold. Either way it is worth a look.
Automation has a place for the items where the buyer's judgement adds little: staple items with steady sales and reliable suppliers. Those can be approved in bulk. The buyer's attention belongs on the exceptions, and the application's job is to make the exceptions short.
Where replenishment looks different by business type
- Grocery Store Software, where orders go out daily or several times a week, lead times are short and the sales rate changes with the day of the week.
- Supermarket Software, where thousands of items are replenished from a warehouse and from direct suppliers on different cycles.
- Hardware Store Software, where the range is wide, most items are slow and steady, and the risk is the fastener nobody noticed was out.
- Pet Store Software, where a small number of food lines sell steadily to repeat customers and a stockout sends the customer elsewhere for good.
- Convenience Store Software, where space is tight, deliveries are frequent and the target level is set by the shelf, not the back store.
- Multi-Store Retail Software, where replenishment is per store and the order may be to the warehouse rather than to a supplier.
Why retailers choose Pentoggle for replenishment
The inputs kept current
Sales velocity from actual sales, lead time from actual receipts, available stock including on order and in transit.
A suggestion with its reasons
Each item's suggested quantity shown with what produced it, so the buyer can judge it rather than trust it.
Pack sizes and minimums applied first
Suggestions rounded and grouped by supplier before the buyer sees them.
Exceptions, not lists
Items below reorder point with nothing coming, items over target with orders open, parameters not reviewed for months.
Sits around your accounting and your purchasing
QuickBooks, Tally, Xero and comparable systems continue handling supplier invoices and payments. Pentoggle adds the reorder decision and passes approved orders to purchasing.
A useful number for replenishment
Items below their reorder point with nothing on order.
It is the list of stockouts that have not happened yet, and it is short enough to act on today. Every item on it is a decision someone has not made: order it, accept the stockout, or change the parameters because the reorder point is wrong.
Read it weighted by sales. Twenty slow items below their reorder point matter less than two fast ones, and the list should show velocity beside each so the buyer works the top first.
Read the trend. A list that grows week on week may mean the buyer cannot keep up, the parameters are set too high, or the stock figure has drifted and items appear low that are not. Each is worth checking before assuming the first.
Ready to build retail replenishment software?
You know which items sell fastest.
You may not be able to say which of them are below their reorder point right now with nothing on the way.
Describe your items, your suppliers and how you decide what to reorder to Pentoggle in plain English and generate a working first version in hours, then refine it around your process.