Glossary
Safety stock
Extra inventory held to absorb variability in demand or supply.
Technical definition
A buffer quantity carried to maintain service levels given uncertainty in demand and lead time.
Formula
Safety stock ≈ Z × σ_demand × √lead time
Manufacturing example
Holding two extra days of a critical film guards against supplier delays.
Common misconception
More safety stock is not always better; it ties up cash and can hide underlying process problems.
Why it matters operationally
Right-sized safety stock protects service without over-investing in inventory.
Related ConstraintFlow capability
Related terms
Put safety stock to work
See how ConstraintFlow turns operational concepts into optimized decisions.