A Journey Through Safety Stocks, Part 2
This blog discusses the importance of adjusting and refining safety stock approaches to balance inventory.
5 Questions About Safety Stock Calculations
There are various approaches to safety stock calculations. This blog previews a free webinar that sheds light on the pros and cons of each.
How to Choose the Right Demand Variance Method to Calculate Safety Stock
In today’s blog, we will share some examples to help Inventory Planners explore different methods available to calculate Demand Variance and decide which method is best suited for their products and businesses.
The Relationship Between Forecast Accuracy and Safety Stocks
A company’s total inventory consists of many types of stock such as strategic, anticipation, safety, cycle, and unplanned. Cycle stock is most connected to the demand forecast; it is expected to be sold as the forecast becomes real demand. Safety stock on the other hand is extra stock to deal with the variability of the demand or supply. As such, it is not always linked to forecasting accuracy.
Using Coefficient of Variation to Drive Safety Stock Related Decisions
In a previous blog post, we discussed how a high or low value of Coefficient of Variation (CV) impacts the first or second term of safety stock. Today we decided to put this to the test using real customer data - here we will discuss our findings.
Using Coefficient of Variation as a Guide for Safety Stocks
In one of my previous posts, I wrote about using coefficient of variation (CV) as a predictor of forecastability. In this post, I will talk about how it can be used to indicate a sensitivity of lead time towards the safety stock calculations. To quickly remind the reader first: The formula for CV = StdDev
Eliminating Some Of The Safety Stock Mystery
In the simplest inventory situation, the only variability is in the quantity of demand for a single day. There is no trend up or down or seasonal effect. The demand today is independent of the demand for tomorrow. Additionally, we will assume replenishment time is zero. That is when we place an order for additional