Safety Stock
Category: Planning
Definition (plain English)
Safety stock is extra inventory held above expected demand to absorb demand spikes, supplier delays, freight disruption, customs holds, or receiving delays.
Why it matters commercially
It protects service level, but it also ties up cash, warehouse space, and shelf-life, so the buffer has to match real lead-time and demand risk.
Example
A distributor held three weeks of safety stock for an imported sauce because sea freight and customs clearance varied by up to 18 days during peak season.
Common mistake
Setting a flat safety-stock rule without checking lead-time variability, MOQ, expiry risk, warehouse capacity, customer service target, and cost of stockout.
Use this in CommerceKit
Supplier Quotes
Use tool →MOQ & Shelf Life
Use tool →