How often are stock levels monitored in a periodic review system?

In a periodic review system, stock levels are monitored at fixed intervals. This means that inventory is checked and replenishment decisions are made based on observations taken at specific, predetermined times rather than continuously or on an ad-hoc basis. This approach allows businesses to optimize inventory levels without the costs associated with constantly monitoring stock, making it an efficient way to manage supplies.

The fixed intervals can vary depending on the business needs and the nature of the inventory but are established to maintain a balance between holding costs and the risk of stockouts. This predictable timetable helps organizations plan better for demand and manage their resources accordingly.

In this system, monitoring only when stock is low would not ensure consistent inventory levels and may lead to stockouts. Continuous monitoring, while providing up-to-date data, could be unnecessarily costly and resource-intensive for many businesses. Monitoring at irregular intervals could also lead to inefficiencies, as it does not provide a systematic approach for inventory management.