Select the description which most closely fits the term SAFETY STOCK:
A) the time it takes to replenish an item in inventory.
B) extra inventory of an item carried to protect against variations in demand during lead time
C) a listing of components required to manufacture a product
D) the time when an order should be placed
E) none of the above

Question

Quizplus · Accepted Answer

Safety stock is extra inventory of an item carried in anticipation of variations in demand during lead time. It acts as a buffer to ensure that customers are served even if there are unexpected increases in demand or delays in replenishment.

Select the Description Which Most Closely Fits the Term SAFETY