Inventory Control Chart (Bar Gate Stock Graph)

• Bar gate stop graphs are all about managing stock levels, which could be raw materials or components, to make the end product
• Y axis

  • Measures the stock level, in this case, measured in tons
• X axis


  • Measures time, in this case measured in weeks
• Buffer stock


  The bare minimum stock level that a company wants to hold, in this case, it is 8 tons
• Reorder level


  When the stock falls below this level, an order needs to be made
• Lead time calculation

  Lead time is the time taken for an order to be delivered after falling below the reorder level
• Lead time for the first delivery was two weeks
• Lead time for the second delivery needs to be calculated
• 5 minus 3 is 2


  Mathematical relationship
• First delivery took two weeks to arrive
• Calculating lead time for first delivery


  Subtracting the week of order from the week of arrival
• Calculating lead time for second delivery


  Subtracting the week of order from the week of arrival
• Calculating delivery size for first delivery

  Subtracting the starting tonnage from the finishing tonnage
• Calculating delivery size for second delivery

  Subtracting the starting tonnage from the finishing tonnage
• First delivery size was 5 tons
• Second delivery size was 10 tons
• Maximum capacity is the theoretical maximum stock levels a company can hold
• Larger maximum capacity can lead to economies of scale in purchasing