Min/Max Inventory Planning Explained

"Min/max" shows up in older ERP systems, 3PL dashboards, and inventory software that predates "reorder point" as the common term. If you've been told to "set your min and max" and wondered whether that's a different system from the reorder-point math you already use, it isn't: it's the same two numbers under older names.

What min/max means

Min/max inventory planning sets two numbers per SKU: a minimum, the stock level that triggers a reorder, and a maximum, the level you order up to. Whenever stock falls to the min, you place an order sized to bring it back up to the max. In operations-research terms, this is an "order-up-to" policy: order a variable amount, whatever closes the gap to the target, rather than always ordering a fixed quantity. It's one of several inventory-control approaches summarized in the site's inventory management fundamentals guide.

Min is your reorder point

The "min" in min/max is the same number the reorder point formula already calculates: lead-time demand plus a safety buffer. Nothing new to derive here; if you've already set a reorder point for a SKU, you already have its min.

Max is your target stock level

The "max" is the target stock level covered in how much inventory you should keep: enough to cover demand through your next planned order, plus lead time, plus the buffer. Same formula, older name.

A worked example

"Cedar & Fig, 250g": min = 90 units, its reorder point, and max = 240 units, its target stock level. Stock falls to 90, and the system, whether spreadsheet, ERP, or app, orders enough to bring it back to 240.

240 − 90 = 150 units, before any rounding to a supplier's minimum order quantity or case pack.

Where min/max falls short

Two gaps worth knowing about before you rely on it. First, min and max are static until someone updates them. If lead time slips or sales velocity shifts, the numbers on screen stop matching the store underneath them, and nothing in the min/max system itself flags that drift. Second, min/max treats every SKU the same way by default; a fast-moving bestseller and a slow-moving accessory can end up on the same review cadence unless you deliberately tier them, which is a prioritization decision covered in prioritizing products for reordering, not something min/max solves on its own.

Recalculating min and max by hand, per SKU, on a schedule tight enough to catch real drift, is the maintenance problem most stores eventually hand off. StockCue recomputes both from live sales data instead of leaving them wherever they were last set, with forecasting on every plan including Free.

Frequently Asked Questions

What is min/max inventory planning?

Min/max inventory planning sets a minimum stock level that triggers a reorder and a maximum level you order up to. When stock falls to the min, you order enough to bring it back to the max. It's an older, practitioner-standard name for a reorder point paired with a target stock level.

Is min/max the same as a reorder point and target stock level?

Yes. Min is the reorder point, the trigger. Max is the target stock level, the destination. Min/max is those two concepts under different, older terminology, not a separate system.

Does min/max account for lead time?

Yes, indirectly. Lead time is one of the inputs already built into the min, since the reorder point formula uses average daily sales times lead time, plus safety stock. What min/max doesn't do automatically is notice when your actual lead time changes; you still have to recalculate min and max when it does.