MAXIMUM STOCK : The level of stock that should be held for the organisation to minimise the costs of storing stock, The business must take into account storage space, security, cost of storage facilities and amount of money that will be tied up in stock, MINIMUM STOCK : The level that stock must not fall below as shortages in raw materials could result in reduced output and customer orders not being met, A business must take into account delivery times of their supplier, RE-ORDER STOCK: This is the point that new stock must be ordered, This is calculated by considering the average daily usage and the time taken to receive the new supplies (lead time), RE-ORDER QUANTITY : Once the re-order level is reached, a standard quantity is automatically requested, When this stock is received, the maximum stock level should be restored,

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