Buffer stock definition

Buffer stock, also called buffer inventory, excess inventory or safety stock, is a cushion of supply in excess of forecast demand. Buffer stock may be found at all stages of the supply chain, and is intended to reduce the incidence or severity of stock-out situations and thus provide better customer service. Buffer stock is used in production or other inventory situations to ensure that exceptional or out of the ordinary events or demands can be met with some degree of certainty.

Search again for the other inventory planning answers.