Line Point is essentially the target stocking level we want to reach when we place the order and is based on the ARP’s Review Cycle (RC). If our review cycle is 14 days, line point will be based on 14 days of usage, or the amount we expect to sell before we plan to place another PO with this vendor.
Line Point = Order Point + (Review Cycle * ADU)
When we place an order for an item, we order enough to go from current stocking levels up to line point. Line point is why it’s important to establish realistic and accurate review cycles for each ARP.
You can specify a threshold maximum order point
See also
Understanding Replenishment Values
Entering Threshold Maximum Line Point replenishment parameters
Entering Lead Time Replenishment Parameters
Replenishment Variables Calculations
Inventory Control Replenishment Parameters