safety stock


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Safety Stock

Inventory a company keeps in order to avoid running out. For example, a grocery store may buy more apples than it expects to sell in case there is a sudden uptick in demand or if the next delivery is delayed. Safety stock is considered a drain on a company's finances because it very likely will not sell. However, it may be necessary for the smooth function of a business. See also: Supply chain management.

safety stock

see STOCK CONTROL.
References in periodicals archive ?
As demand and lead-time variability increase there is a need to increase the amount of safety stock in order to achieve the desired CSLs.
The requirement for naval convoy operations will delay the arrival of materiel as ships are marshaled into protective convoys, thus increasing the requirement for safety stocks to account for the delays caused by convoy operations.
Bard (Bard), with the intention to increase its safety stock, which generated additional sales of approximately SEK28m in Q3 2015.
Intuitively, having safety stock reduces schedule instability because it establishes a cushion against unexpected demand variations (Sridharanm 2007, Lin, Krajewski, Leong, & Benton, 1994).
min] equal to zero starting from the inadmissible stock shortage and the zero safety stock, and the Q reorder quantity until the admissible [Q.
The visuals should quantify the variability of actual consumption, provide visual clues on the amount of inventory being carried on-hand, and the amount of safety stock held,” shared Leonard.
Safety stock was proportional to the actual demand.
Safety Stock Levels As mentioned earlier, the simplest fix to unfilled orders situation is to raise the safety stock levels.
An average student should be able to identify anticipation inventory and safety stock inventory.
The old fashioned way to avoid those outcomes was to load up on safety stock at each storage location in the network.
Safety stock is a term used by inventory specialists to describe a level of extra stock that is maintained below the cycle stock to buffer against stock outs.
It offers end-to-end visibility, improves inventory utilisation, reduces excess safety stock and minimises lost sales due to stock-outs, while allowing Borders to establish its own sourcing rules.