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Inventory & Ordering

Safety Stock & Reorder Point

Set a service level and see safety stock, reorder point and the demand-during-lead-time distribution

Demand During Lead Time

Results

Safety stock
0
Reorder point (ROP)
0
z (service factor)
0
Cycle stockout risk
0%

Inputs

About this tool

Safety Stock & Reorder Point

The concept

Safety stock is the buffer against demand and lead-time uncertainty at a chosen service level.

How it works

The z-score of the target service level scales the demand variability over lead time.

Winning strategy

Raise service from 95% to 99% and stock jumps sharply - z grows fast in the tail.

SS = z x sigma_d x sqrt(L)
Safety stockService levelz-scoreLead time variability
Core idea: Safety stock