Understanding Your Safety Stock Calculations

If you manufacture or distribute products, it's safe to assume that you have a specified safety stock level— or at least we certainly hope you do. If you're on the fence about whether or not to hold safety stock, we recommend reading up on why it's critical to overcoming variability in your supply chain.

At this point, you may be saying to yourself, "but carrying excess inventory is expensive!"…

Why Safety Stock Is So Important to Your Supply Chain

Managing a supply chain is not easy, although the job description is seemingly straightforward: Ensure that the right products are available at the right location at the right time. Sounds easy, right? That's because you haven't considered the factors that constantly get in the way — factors such as inaccurate forecasts, transportation delays, and inclement weather.

Of all the factors that…

Stratifying Customer Service Levels for Greater Profits - ABC Analysis

In my last post, I talked about the importance of safety stock, as well as its associated costs. In this post, we’ll look into how you’re setting your customer service level targets.

When you set customer service level targets, are you treating all of your items the same? Are you treating all of your customers the same? If so, does that really make sense?

One reliable approach to…