Use this method in the Order Point Report (ROP) to calculate the order point based on sales history and lead time. You will probably use this method for most items.
The Method 3 fields determine the total weeks of supply. The system does not look at each of these fields individually. It looks at the total weeks of supply. Therefore, the number of weeks you enter in each field is not as important as the total number of weeks.
Here are some examples of how you can use Method 3 to determine the total number of weeks.
For a weekly warehouse order, you may want to use three to six total weeks of supply. Toward the end of a season, you may want to decrease the weeks of supply to lower your inventory costs.
If you are ordering from a manufacturer who comes by for an order once a quarter, use a higher total weeks of supply (for example, 12 to 15 weeks).