By Safock Procurement Research Team8 min read
A kitchen uses about 3.2 cases of chicken a day. The distributor delivers every three days, two days after the order goes in. Look up "how to calculate par levels" and the most common formula gives a par of 12 cases. Order up to 12 every three days and, on the same assumptions, the kitchen runs short in about 94% of delivery cycles.
That formula answers a different question from the one the kitchen is asking when it counts the walk-in and places an order. This guide explains the difference, gives the formula that holds, and shows which inputs move the number most.
A par level is the quantity of an item a site keeps on hand to cover usage between deliveries. In practice it is the level you order up to: on order day, count what is on the shelf, subtract it from par, and order the difference.
It suits sites that order on a fixed schedule, such as every Monday and Thursday. Stock that is checked continuously and reordered whenever it falls to a set level uses a reorder point instead. Our guide to safety stock and reorder points covers that case.
The mistake most shortcuts make is about timing. Follow one order through:
The stock you count on day 0, plus what you order, has to last until day 5. So the par has to cover the lead time plus the days between deliveries: 2 + 3 = 5 days. A par that covers only the 3 days between deliveries, or only the 2 days of lead time, leaves the shelf short.
Par = average daily usage × (lead time + days between deliveries) + buffer
The buffer covers days that run busier than average and deliveries that arrive late. It comes from how much usage varies and how much the lead time varies:
Buffer = z × √( (L + R) × σd² + d² × σL² )
where d is average daily usage, σd its day-to-day variation, L the lead time, σL the variation in lead time, R the days between deliveries, and z a factor for how often the par should last (1.88 for 97% of cycles).
For the chicken:
With 5 cases on the shelf on order day, the order is 16 cases.
The same chicken, the same delivery schedule, four common ways of setting par. "Lasts the cycle" is how often stock would last until the next delivery arrives.
| Method | Par | Lasts the cycle |
|---|---|---|
| (Weekly usage + 25%) ÷ deliveries per week | 12.0 | 6% |
| Usage over the lead time + 25% | 8.0 | 0.1% |
| Usage until the next delivery arrives, no buffer | 16.0 | 50% |
| One week of usage | 22.4 | 99.4% |
| Formula above, 97% of cycles | 20.8 | 97% |
The first two formulas are common in restaurant guides. Each covers only part of the five days: the first spreads a week's usage across deliveries, and the second covers the lead time only, as a reorder point does. Used as an order-up-to level on order day, both leave the shelf short almost every time.
"One week of usage" works here by luck: a week happens to be longer than five days. It holds about $185 more chicken on average than the 97% par. For an item delivered weekly, the same rule would run short more often than not.
The days between deliveries are part of what the par has to cover, so more frequent deliveries lower it sharply. Holding everything else equal:
| Deliveries | Par | Average stock on hand | Value at $118 a case |
|---|---|---|---|
| Weekly | 34.7 | 17.1 | $2,018 |
| Every 3 days | 20.8 | 9.6 | $1,137 |
| Every 2 days | 17.3 | 7.7 | $912 |
| Daily | 13.8 | 5.8 | $685 |
Fewer cases on the shelf means less money tied up and less to throw away when something goes out of date. The trade-off is more deliveries to receive, and more order cycles a year in which a stockout can happen.
When the lead time varies, the buffer has to cover the late deliveries too:
| Lead time varies by | Par | Buffer | Buffer value |
|---|---|---|---|
| 0 days | 19.8 | 3.8 | $447 |
| ±0.5 days | 20.8 | 4.8 | $571 |
| ±1 day | 23.1 | 7.1 | $839 |
| ±1.5 days | 25.8 | 9.8 | $1,155 |
A distributor that delivers when it says it will lets you hold less stock. That is worth putting into a supplier SLA, with on-time delivery measured from your own receiving records.
Raising the target from 95% to 99% of cycles lifts the buffer from 4.2 to 6.0 cases, worth $499 and $706. With deliveries every three days, 95% still means running short about six times a year, and 99% about once. Pick the level per item: a short day on chicken stops service, and a short day on paper napkins doesn't.
Enter an item's usage, lead time and delivery schedule, and the par you use today. The defaults are the chicken example, with the 12-case par from the most common shortcut.
Par for one item · same maths as the full calculator
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Par Level Calculator
Work out the par for one item from average usage or a pasted usage history, see how much to order today, or paste a whole par sheet to calculate every item at once and download it as a CSV.
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Pars set from the formula assume deliveries arrive complete. A short delivery leaves the site short until the next one, so record it on a goods received note and chase the missing quantity.
The amount of an item a site should have after each order arrives, or more precisely the level it orders up to: count what is on hand and order the difference. A good par covers usage until the next delivery after this one, plus a buffer for busy days and late deliveries.
Add the lead time to the days between deliveries, multiply by average daily usage, and add a buffer for variation. The buffer is a service-level factor times the variation in usage over that period, including variation in lead time. For 3.2 cases a day, a 2-day lead time and deliveries every 3 days, par is about 21 cases at a 97% service level.
Enough to cover normal swings in usage and delivery timing for the share of cycles you choose. A flat percentage of usage is a rough guess. The buffer should grow with how unpredictable usage is and how unreliable the supplier’s delivery times are.
Whenever the menu, the delivery schedule or the supplier changes, and at least every season. Run out more than you planned for and the par is too low. Throw stock away, or find it untouched at every count, and the par is too high.
A par level is the level you order up to on a fixed schedule, such as every Monday and Thursday. A reorder point is the level at which you place an order whenever stock falls to it. Par levels suit sites with set delivery days; reorder points suit stock that is checked continuously.