## 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.

By |2023-05-26T10:15:07-04:00September 29th, 2021|Inventory Planning, Safety Stock, Supply Chain|

## 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.

By |2024-03-14T13:50:42-04:00August 31st, 2021|Arkieva Data Analysis Wing, Demand Planning, Forecast Accuracy, Safety Stock|

## 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

By |2024-02-21T14:20:58-05:00September 22nd, 2015|Demand Planning, Forecasting, Inventory Management, Safety Stock, Supply Chain|

## 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

By |2019-04-13T23:09:59-04:00August 6th, 2015|General Topics, Inventory Management, Safety Stock, Supply Chain|