# Oracle EBS Min-Max Planning Quantity Calculator

> Source: https://netray.co/tools/oracle-ebs-min-max-planning-calculator
> Publisher: Netray (netray.co), AI and integration engineering for ERP and manufacturing systems.
> Section: Free Tools

## Short answer

Calculate min and max quantities for Oracle min-max planned items from annual demand, lead time, variability and ordering cost.

## Category

oracle

## Erp

Oracle E-Business Suite

## Industry

Discrete Manufacturing

## Audience

- Inventory planner
- EBS consultant
- Buyer

## Tool

**Kind:** calculator

**Currency:** $

**Inputs:**

#### Annual demand

**Key:** annual_demand

**Type:** number

**Default:** 12000

**Min:** 0

**Step:** 100

**Unit:** units

**Help:** Forecast or last 12 months usage.

#### Working days per year

**Key:** working_days

**Type:** number

**Default:** 250

**Min:** 1

**Step:** 1

**Unit:** days

#### Replenishment lead time

**Key:** lead_time_days

**Type:** slider

**Default:** 14

**Min:** 1

**Max:** 120

**Step:** 1

**Unit:** days

#### Std deviation of daily demand

**Key:** daily_sigma

**Type:** number

**Default:** 12

**Min:** 0

**Step:** 1

**Unit:** units

**Help:** Measured from daily or weekly usage history.

#### Service level

**Key:** service

**Type:** select

**Default:** 0.95

**Options:**

##### 90%

**Value:** 0.9

##### 95%

**Value:** 0.95

##### 98%

**Value:** 0.98

##### 99%

**Value:** 0.99

#### Unit cost

**Key:** unit_cost

**Type:** number

**Default:** 12.5

**Min:** 0

**Step:** 0.5

#### Cost per order or setup

**Key:** order_cost

**Type:** number

**Default:** 45

**Min:** 0

**Step:** 5

#### Annual carrying cost

**Key:** carry_pct

**Type:** number

**Default:** 22

**Min:** 1

**Step:** 1

**Unit:** %

**Outputs:**

#### Average daily demand

**Key:** daily

**Expr:** annual_demand / working_days

**Format:** decimal

#### Z score

**Key:** z

**Expr:** normsinv(service)

**Format:** decimal

#### Safety stock

**Key:** ss

**Expr:** z * daily_sigma * sqrt(lead_time_days)

**Format:** integer

**Description:** Buffer against demand variation during lead time.

#### Minimum quantity (reorder point)

**Key:** min_qty

**Expr:** daily * lead_time_days + ss

**Format:** integer

**Primary:** true

**Description:** Order when projected stock reaches this level.

#### Economic order quantity

**Key:** eoq

**Expr:** sqrt(2 * annual_demand * order_cost / (unit_cost * carry_pct / 100))

**Format:** integer

#### Maximum quantity

**Key:** max_qty

**Expr:** min_qty + eoq

**Format:** integer

**Primary:** true

**Description:** Order up to this level.

#### Orders per year

**Key:** orders

**Expr:** if(gt(eoq,0),annual_demand / eoq,0)

**Format:** decimal

**Chart:**

#### Min and max quantity vs lead time

**Type:** line

**X:** lead_time_days

**From:** 1

**To:** 60

**Steps:** 30

**Series:**

- min_qty
- max_qty

**Disclaimer:** Planning aid only. Assumes normally distributed daily demand and a fixed lead time. Test the result against your real usage history before loading values into item attributes.

## Content

**Intro:** Oracle Inventory min-max planning compares projected stock with a minimum and maximum quantity on the item and suggests replenishment. Choosing those two numbers well is the work. This calculator derives them from demand, lead time, variability and cost.

**Sections:**

#### How to use the calculator

**Body:** Enter annual demand, working days, replenishment lead time and the variability of daily demand. Select the service level you want and add unit cost, order cost and carrying cost. The result shows the minimum quantity (the reorder point), the maximum quantity and the underlying safety stock and order quantity. Use the chart to see how the quantities change as lead time moves, which helps when negotiating with suppliers.

**Bullets:**

- Use the same unit of measure as the item's primary UOM
- Measure variability from real history, not estimates
- Re-run when lead times or demand change materially

#### The formulas

**Body:** Safety stock is the Z score for the service level times the standard deviation of daily demand times the square root of lead time in days. The minimum is average daily demand times lead time plus safety stock. Economic order quantity is the square root of two times annual demand times order cost divided by unit cost times the carrying rate. The maximum is the minimum plus the order quantity, so a replenishment brings stock back up to the maximum.

#### Worked example

**Body:** With the defaults, daily demand is 48 units. At 95 percent service, Z is about 1.645, giving safety stock of about 74 units over 14 days. The minimum is about 746. The EOQ is about 889, so the maximum is about 1,635, with roughly 13 orders per year. If the supplier lead time doubles, safety stock grows by about 41 percent, not double, because variation scales with the square root of time.

#### Using the result in Oracle

**Body:** Min-max quantities are stored as item attributes in the inventory organization, along with the fixed lot multiplier and minimum order quantity if you use them. Apply results to a pilot group first, review the replenishment suggestions for a few cycles, and adjust. Items with lumpy demand, long lead times or supplier constraints may suit MRP or kanban better than min-max.

**Cta:** If you want min and max values recalculated regularly from actual transaction history in your ERP, Netray can discuss a read-only analytics approach.

**Faq:**

#### Is min-max the same as reorder point?

**Answer:** The minimum quantity acts as the reorder point, and the maximum is the order-up-to level. The difference is that Oracle compares projected availability, including open supply and demand, with these values.

#### What service level should I choose?

**Answer:** Higher levels cost more safety stock. Many plants use 95 to 98 percent for regular items and higher for critical spares. Choose by cost of a stockout versus the cost of carrying the stock.

#### Why does the maximum include EOQ?

**Answer:** When stock falls to the minimum, an order of about one EOQ restores it, so the maximum is the minimum plus the order quantity. If your supplier has lot sizes, round up accordingly.

#### Does this suit slow movers?

**Answer:** For very slow items the normal assumption is weak. Use judgement, a Poisson-based approach, or a simple one-or-two-piece policy for expensive, rarely used parts.

## Search terms

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