How to calculate safety stock levels
Working out how much stock to carry is a challenging task. If you carry too much, you tie up working capital. Too little, and you face potential stockouts and unhappy customers.
Safety stock is the extra layer of inventory kept to help deal with this problem.
In this guide we show you how to calculate safety stock - from basic safety stock formulas to the most sophisticated and accurate.
We'll also provide strategies for finding the right balance between inventory costs and availability.
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