How to keep safety stock

inventory is not enough, it is likely to affect the store’s business, after all, there is no product, want to attract consumers will naturally have more difficulties. But if the inventory is too much, not only the need for space storage, but also caused the backlog of funds, which is a big taboo for the store’s business. Although zero inventory is the ideal state of business management. However, in the rapidly changing market, there are many uncertain factors, such as daily demand, delivery time, the degree of cooperation with suppliers.

, the uncertainty of management mainly comes from the suppliers and customers, and the traffic factors can also affect the zero inventory. Supplier is uncertain whether the spot, order processing time and delivery time; customer uncertainty is the customer does not know what specific time will buy, buy when will choose what kind of goods; and traffic factors of uncertainty is reflected in the speed of delivery.

therefore, even the strength of the big market and brand chain operation can do that a few, general business is almost impossible to do, not to mention the business with a small capital of small shops. This stock can not say, but can not prevent. Because once out of stock, to small shops operating or great influence, a few days did not sell, but still rent and utilities, taxes, losses can be seen. Therefore, there is a need for safe stock.

The definition of

safety stock has a standard, specifically in order to prevent the uncertain factors (such as a large number of emergency orders, delivery delay, temporary increase in the amount of sudden, late delivery and other special reasons) and expected insurance reserves (buffer stock), also known as the insurance inventory. The stock of safety stock is set according to the supplier’s delivery cycle, although there is a shortage of suppliers in the case, but the general rules of supply or.

Under the premise of determining the general supply cycle, the average inventory quantity can be considered in terms of the half of the order quantity and the uncertainty of the supply

. Safety stock is "safe" two word specific connotation is the use of non normal conditions, which means only if the goods out of stock, inventory, delivery delay or excessive use of out of stock and other circumstances, can be taken out, and after use should be added at the appropriate time.

The greater the

safety stock, the smaller the possibility of out of stock. In spite of this, we must also consider the consequences of too much safety stock. Therefore, under the premise of the need for safe inventory, according to the use of different goods and customer requirements, appropriate to maintain a certain shortage, allowing the existence of a certain level of shortage phenomenon.

store inventory is very important to store sales, good inventory can improve sales performance, but a lot of stores in the business will encounter bad inventory. There are many reasons for the bad stock, here are five kinds of