Safety Stock Calculator

Use the worst values you have actually seen in the last 6–12 months of normal operation, excluding one-off freaks like a viral video or a port strike. A good rule is the 95th percentile: the sales day and the lead time that were only exceeded a handful of times. Using your all-time record for both multiplies two rare events together and produces an enormous, expensive buffer.

It trades one risk for another. Every buffer unit is cash you cannot spend on ads or new products, plus holding cost of roughly 20–30% of its value per year, plus obsolescence risk if the product changes. The goal is to cover the stockouts that would actually hurt — for slow, easily reordered SKUs a small buffer or none at all is often the right call.

Safety stock is the buffer itself; the reorder point is the trigger that includes it. Reorder point = average daily sales × average lead time + safety stock. In the default example the 350-unit buffer sits inside a reorder point of 20 × 14 + 350 = 630 units. Size the buffer here first, then feed it into the reorder point calculator.

No — buffer where a stockout is expensive and demand or supply is jumpy. A-grade sellers with long overseas lead times deserve generous safety stock; slow movers you can restock domestically in three days often need little or none. Many merchants set buffers as days of supply per tier: for example 14 days for A items, 7 for B, and zero for C.