Model
Safety stock ≈ Z × σ × √L for demand variability during lead time L.
Reorder point = average demand in lead time + safety stock.
Key takeaways
- Higher service level increases Z and stock
- Longer lead times require more buffer
Related calculators
Apply these concepts with formula-based tools on Calculator Factory.
- BusinessSafety Stock Calculator
Calculate safety stock and reorder point using demand variability, lead time, and a target service level Z-score.
- BusinessEOQ Calculator (Economic Order Quantity)
Calculate the optimal order quantity that minimizes total inventory ordering and holding costs using the classic Wilson EOQ model.
- BusinessInventory Reorder Calculator
Find your reorder point, days until stockout, and stockout risk level for small business inventory planning.
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FAQ
- What Z-score for 95%?
- Approximately 1.65 for a one-sided 95% service level under normal demand assumptions.