Concepts
Safety Stock
Safety Stock: Extra inventory held to protect against variability in demand or supply.
What safety stock means
Safety stock is the buffer kept above expected demand. It protects the business when usage is higher than normal, a supplier is late, or a count was wrong.
When to use safety stock
Use safety stock for items that cause lost sales, job delays, or emergency purchases when they run out. Avoid using it as a substitute for accurate counts.
How to reduce safety stock without increasing risk
Improve supplier reliability, count accuracy, lead-time visibility, and low-stock alerts. Better data lets teams hold less buffer while still avoiding stockouts.