Setting Effective Inventory Safety Stock Levels
- On 02/15/2018
- inventory, safety stock
The role of safety stock (a.k.a., "minimum inventory levels") and its relationship with demand is commonly misunderstood. A popular intuition is to increase safety stocks whenever an increase in demand is anticipated. However, this misses the point of what safety stock levels should be designed to do. The use of average expected rates of demand […]
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