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Best Practices for Calculating Safety Stock and Service Levels

presented by Lorman Education Services
View the Lorman Education Services Profile and Course Listings

Summary

Best Practices for Calculating Safety Stock and Service Levels

Workshop Description/Agenda

Benefits
Understand the power of safety stock and how to calculate it. How do you know when there is enough inventory to meet demand? When is the right time to buy? How much should be purchased? Holding too much inventory consumes cash, space and may lead to shrinkage and obsolescence, while holding too little leads to back orders, production delays, expedited shipping and unhappy customers. In this topic we will explore inventory and purchasing concepts, how to use data to glean insight about your products and how to establish a systematic approach to purchasing.

Agenda
Inventory - Review
ï Classifications and States (Raw, Wip, Finished)
ï Valuation Methods (FIFO, Average, Actual)
ï Effects on Balance Sheet and Income Statement

Inventory Usage Patterns
ï Continuous vs. Spot
ï Seasonal
ï Trends
ï New and Discontinued SKUs

Service Level
ï Overview
ï Order Fulfillment History
ï Orders Never Entered

The Trade-off: Inventory on Hand vs. Service Level
ï How to Keep Service Levels High Without Increasing Inventory

A Systematic Approach Using Reorder Points
ï Reorder Point = Lead Time Demand + Safety Stock
ï What Is Lead Time?
ï Order Interval and How Does It Affect Lead Time?
ï Determining Demand
ï Demand Variation and How It Affects Service Level
ï How Does Service Level Affect Safety Stock?
ï Maximum or Order up to Quantity
ï Order Quantity

Faculty
Ian Benoliel with NumberCruncher.com, Inc.

Credits
AIPB ,APICS ,CPE ,ISM ,Additional credit may be available upon request.

Who Should Attend

This live webinar is designed for purchasing and procurement professionals, buyers, material managers, contract administrators, project managers, controllers, accountants and bookkeepers.

Additional Information

Training Provider: Lorman Education Services

Course Topics: Purchasing / Procurement Training > Essentials

Training Course Summary: Best Practices for Calculating Safety Stock and Service Levels


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