Decay rate is a model parameter representing a fractional loss of usable inventory over a stated period. In replenishment planning it can estimate a daily loss allowance, but it is not a product shelf-life rule, a physical count or a direct measurement of every source of shrinkage.
A simple fractional-loss model
If no consumption or replenishment occurs and the same fraction d is lost each day:
I(t) = I0 × (1 − d)^t
At an illustrative 5% daily loss, 100 units become 100 × 0.95^7 = 69.83 modeled usable units after seven days. This does not mean a food, medicine or other dated product is safe for seven days. Follow the actual product requirements and approved release procedure.
Constant fractional loss is a simplifying assumption. A whole lot reaching expiry on one date behaves differently from a small fraction being lost every day. Damage, theft, unrecorded transfers, recipe yield and a counting mistake also need separate explanation.
Add consumption without counting loss twice
The current LineNow planning recurrence applies the configured loss before each day's non-decay usage:
I(t + 1) = (1 − d) × I(t) − c
Opening stock for T days = (c / d) × ((1 − d)^(-T) − 1)
Use c for consumption that excludes the loss already represented by d. For d = 0, use c × T instead of dividing by zero.
With c = 18 units/day, T = 7 days and d = 0.05, the model requires 155.51 opening units, versus 126 without loss. That is a 23.42% increase before a separate safety buffer or software cap. It is a scenario calculation, not a recommended spoilage allowance.
The ordering of events matters. Applying usage before daily loss produces a different formula. State the recurrence when comparing calculators so a difference in outputs is not mistaken for an arithmetic error.
Estimate from evidence, not a category table
A generic “10% per day for protein” or “2% per day for dairy” does not establish your operation's loss rate. Begin with tagged waste, product condition, receiving quality, storage records and physical counts. Identify a stable period and comparable stock before estimating a planning allowance.
Do not convert an unexplained month-end variance into daily spoilage. Reconcile transfers, unit conversions, sales mappings and unrecorded use first. Keep trim yield separate if the recipe already accounts for it. Keep markdowns separate because they change value rather than physical quantity.
Where evidence is sparse, record the assumption and compare multiple scenarios. A high loss assumption should prompt investigation and a review of delivery frequency, pack sizes and storage capacity, not automatic acceptance of larger orders.
How LineNow uses the input
LineNow stores a buyer-entered decay fraction for forward-looking PAR and coverage calculations. The current replenishment calculation caps its contribution relative to base demand. It does not reduce actual on-hand merely because a forecast predicts loss; actual spoilage is recorded through an inventory adjustment.
Review the chosen input alongside actual waste and count reconciliation. Avoid adding modeled decay to a usage rate that already includes the same loss. Demonstrate the distinction between projected coverage and recorded inventory in the inventory workflow.