ERP & MRP Planning worked example

Inventory Policy Days with usable on-hand quantity of 3,600 units: a worked example

This worked example runs the inventory policy days numbers for a tougher week than the baseline: usable on-hand quantity of 3,600 units instead of the typical 7,200 units. Estimate protected inventory days from usable on-hand quantity, daily usage, and policy risk factor.

The inputs for this scenario

  • Usable on-hand quantity: 3,600 units (the input this scenario stresses; the baseline uses 7,200)
  • Average daily demand or usage: 480 units / day (held at the documented default)
  • Inventory policy risk factor: 1.2 x (held at the documented default)

Working through the calculation

  • The calculation starts from the formula this tool documents: Protected inventory days = usable on-hand quantity ÷ average daily usage ÷ inventory policy risk factor.
  • Protected inventory policy days works out to 6.25 days at these inputs, and this is the headline figure for the scenario.
  • Unadjusted days of supply works out to 7.5 days at these inputs.
  • Usable on-hand quantity works out to 3,600 units at these inputs.
  • Average daily demand or usage works out to 480 units / day at these inputs.

How this compares with the baseline

  • Against the tool's baseline example, where usable on-hand quantity sits at 7,200 units and the headline result is 12.5 days, this scenario comes in 50% below the baseline at 6.25 days.
  • Use it when setting reorder points, validating safety stock, or stress-testing whether a SKU's current position survives forecast error and replenishment lead time. A result at this level usually justifies acting on the stressed input before touching anything else, because every other figure in the table is downstream of it.

Results at a glance

  • Protected inventory policy days: 6.25 days (headline result)
  • Unadjusted days of supply: 7.5 days
  • Usable on-hand quantity: 3,600 units
  • Average daily demand or usage: 480 units / day

Run it with your numbers

  • To rerun this with your own numbers, open the live Inventory Policy Days calculator, set usable on-hand quantity to your actual value, and adjust the remaining inputs to match your operation.

Last reviewed 2026-05-12.