Free Safety Stock Calculator
Calculate safety stock levels to maintain a buffer against demand variability and supply uncertainty, reducing the risk of stockouts.
Safety Stock
270
Safety Stock vs Maximum Lead Time (days)
How to Calculate Safety Stock
Formula
Safety Stock = (Max Daily Demand x Max Lead Time) - (Avg Daily Demand x Avg Lead Time)
This is the Heizer and Render method, one of the simplest safety stock formulas. It accounts for the worst-case scenario: peak demand occurring during the longest possible lead time. The difference between this worst case and the average case is the buffer you need. More sophisticated methods use standard deviations and service level targets, but this approach works well for businesses without detailed statistical data.
Example Calculation
Average daily demand is 40 units but can spike to 55. Average lead time is 7 days but can stretch to 10.
- 01Max Demand During Lead Time = 55 x 10 = 550 units
- 02Avg Demand During Lead Time = 40 x 7 = 280 units
- 03Safety Stock = 550 - 280 = 270 units
Frequently Asked Questions
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