Safety stock calculator. The right buffer, not a guess.
Safety stock is the extra stock held to cover swings in demand and in supplier lead time. Enter your service level, average demand and lead time with their standard deviations and this calculator gives safety stock, the reorder point, the stock value and how the buffer changes with service level.
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| Service level | z | Safety stock | Value |
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SS = z × √(LT × σd² + d² × σLT²), which combines demand variation over the lead time with lead-time variation at average demand, assuming the two are independent and roughly normal. z is the one-sided standard normal value for the cycle service level. Use the same time unit (days) for demand and lead time. Results are rounded up to whole units.
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Three steps. One clear answer.
- 01
Choose the service level: the chance of not running out in each order cycle.
- 02
Enter average daily demand and lead time, each with its standard deviation.
- 03
Read your safety stock, reorder point, stock value and the table across service levels.
SS = z × √(LT × σd² + d² × σLT²), where z is the one-sided standard normal value for the cycle service level (80% 0.8416, 85% 1.0364, 90% 1.2816, 95% 1.6449, 97.5% 1.9600, 98% 2.0537, 99% 2.3263, 99.5% 2.5758, 99.9% 3.0902), d and σd are the average and standard deviation of daily demand, and LT and σLT the average and standard deviation of lead time in days. The demand-only formula z × σd × √LT is shown for comparison. Reorder point = d × LT + SS. Demand and lead time are treated as independent and roughly normal.
Results are estimates to support your decisions. For binding figures, ask our team or your customs broker.
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Straight answers.
Anything else, ask us directly. A principal replies, not a bot.
anirudh@sourcesquid.coWhat is the safety stock formula?
When both demand and lead time vary: SS = z × √(LT × σd² + d² × σLT²). When only demand varies it simplifies to z × σd × √LT.
Which service level should I choose?
Many businesses use 95% for regular items and 98% to 99% for key items or items with high margins. Each step up costs more stock, so the table shows the trade-off.
Why does lead-time variation matter so much?
Each extra day of delay must be covered at full average demand. With imports from Asia, a few days of variation in production or shipping often drives most of the buffer.
How do I find the standard deviation of demand?
Take daily sales for a recent, representative period and use =STDEV.S() in a spreadsheet. Use weekly data divided by √7 if daily data is noisy, and keep all figures in days.
Is service level the same as fill rate?
No. Cycle service level is the chance of no stock-out during an order cycle. Fill rate is the share of demand met from stock, which is usually higher for the same safety stock.
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