Which type of planning uses pre-established reorder points and stock levels?

Consumption Driven Planning (CDP) focuses on managing inventory levels based on actual consumption patterns rather than merely on forecasts or predefined rules. In CDP, replenishment decisions are made by monitoring consumption data and adjusting stock levels accordingly. This approach uses pre-established reorder points to know when to trigger a reorder based on the consumption rate, ensuring that inventory levels align closely with actual demand.

This methodology is particularly effective in environments with fluctuating demand, as it allows for more responsive inventory management. By relying on actual consumption trends, companies can avoid both stockouts and excess inventory, enhancing efficiency and reducing costs.