Parts and inventory
Safety stock calculator
Safety stock is the buffer that covers you when usage runs hot and the supplier runs late at the same time. This is the max-minus-average method, which needs no statistics and no assumption about how demand is distributed.
Safety stock = (Max daily usage × Max lead time) − (Average daily usage × Average lead time)
The worst day you have on record
The latest the supplier has ever been
Show the assumptions
- Formula
- Safety stock = (Max daily usage × Max lead time) − (Average daily usage × Average lead time)
This method sizes the buffer against the worst case you have actually seen. It is more conservative than a statistical service-level calculation, and it is defensible without a demand history long enough to fit a distribution to.
A negative result means your maximums are not worse than your averages, which almost always means the maximums came from too short a history. Widen the window before trusting a zero buffer.
Safety stock
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Prefilled with an example. Change any number and the result updates.
How to calculate Safety stock
Safety stock = (Max daily usage × Max lead time) − (Average daily usage × Average lead time)
This method sizes the buffer against the worst case you have actually seen. It is more conservative than a statistical service-level calculation, and it is defensible without a demand history long enough to fit a distribution to.
Worked example
- Maximum daily usage 9 units
- Maximum lead time 28 days
- Average daily usage 4 units
- Average lead time 14 days
Safety stock = 196 units
Reading the result
A negative result means your maximums are not worse than your averages, which almost always means the maximums came from too short a history. Widen the window before trusting a zero buffer.
Safety stock questions
Is this the same as the statistical safety stock formula?
No. The statistical method multiplies a service-level factor by the standard deviation of demand over lead time, and it needs enough history to estimate that deviation. The max-minus-average method used here sizes the buffer against the worst case on record instead. It is generally more conservative, and far easier to explain to whoever signs off the stock value.
Do I need safety stock for every part?
No, and holding it for every part is how MRO inventory value gets out of hand. Buffer the parts where a stockout stops production or creates a safety issue. For everything else, a longer wait is cheaper than the carrying cost.
Related calculators
Manage MRO stock
UpKeep records the work, the hours and the failures this metric depends on, so Safety stock is a report rather than a spreadsheet exercise.