## Re-Order Level (Re-Order Point)
The Re-Order Level is the inventory level at which the company must place its next order for material. It answers the question: "When should we order?"
### Formula 1 (Default)
$$\text{ROL} = \text{Maximum Consumption per day} \times \text{Maximum Lead Time}$$
### Formula 2 (When Safety Stock + Annual Consumption Given)
$$\text{ROL} = (\text{Average Consumption per day} \times \text{Average Lead Time}) + \text{Minimum Stock OR Safety Stock}$$
### Decision Rule (Which formula to use)
| Situation | Formula |
|---|---|
| Only max consumption & max lead time given | Formula 1 |
| Minimum stock not given but safety stock given (with annual consumption) | Formula 2 (use safety stock) |
| Minimum stock is given and you used something else | Use Formula 1 |
| Safety stock AND annual consumption given | Always Formula 2 |