In order to cushion against uncertainties in demand companies carry _______ inventory:
A) Cycle stock
B) Anticipation inventory
C) MRO
D) Safety stock
E) Pipeline inventory

Question

Quizplus · Accepted Answer

Safety stock is the inventory held by companies as a buffer against unexpected demand or supply chain disruptions. It ensures that the company can still meet customer demand even if there are unforeseen fluctuations in demand or delayed shipments from suppliers. Cycle stock is the inventory needed to meet demand during regular ordering cycles, anticipation inventory is held in anticipation of future demand, MRO inventory is for maintenance, repair, and operating supplies, and pipeline inventory is the inventory in transit between different stages of the supply chain. While all of these types of inventory may be carried by companies, only safety stock specifically addresses uncertainty in demand.

In Order to Cushion Against Uncertainties in Demand Companies Carry