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safety-stock-review

Computes and stress-tests safety stock levels against empirical demand history per SKU.

30.5k|3.5k|Updated Jul 4, 2025
Search Tags:#inventory management#supply chain#safety stock#service level#reorder point#fill rate#demand variability
One-click install
npx skills add https://github.com/davila7/claude-code-templates --skill safety-stock-review
Or copy as Structured Prompt for Agent▼
Please help me install this Agent Skill.
Skill: safety-stock-review
Source: https://github.com/davila7/claude-code-templates/tree/main/cli-tool/components/skills/operations/safety-stock-review
Command: npx skills add https://github.com/davila7/claude-code-templates --skill safety-stock-review

SYSTEM DOCUMENTATION & REQUIREMENTS

What problem does it solve?

Textbook safety stock formulas assume roughly normal demand, but real SKU portfolios contain intermittent and high-variability items where that assumption fails silently. This Skill computes the standard zsigmasqrt(LT) result and then empirically stress-tests it against actual demand history, so you know where the number can be trusted before committing inventory capital.

Core Features & Use Cases

  • Formula computation with assumption checks: Calculates safety stock and reorder points using the normal formula, including the extended form when lead time varies, and flags SKUs (CV >= 1.0 or intermittent demand) where results will be optimistic.
  • Empirical stress testing: Replays actual demand history against the proposed stock level and reports both achieved cycle service and achieved fill rate, exposing the gap between theoretical and real service.
  • Cost-of-nines analysis: Shows safety stock required at 90/95/98/99% service targets so service levels can be treated as pricing decisions.
  • Use Case: A supply chain analyst has 12+ periods of demand history per SKU and a 95% service target in a contract. The Skill classifies each SKU by variability, computes formula-based safety stock, stress-tests it against history, and recommends per-class policies (formula, empirical sizing, or MTO) instead of one global target.

Quick Start

Analyze my SKU demand history file and compute safety stock and reorder points for a 95% fill rate target, then stress-test the results against the actual history.

Frequently Asked Questions about safety-stock-review

High-intent search queries and answers about installing and using this skill.

FAQPage Schema
How do I calculate safety stock for inventory with variable demand?▼

Use the formula SS = z * sigma_d * sqrt(LT), where z corresponds to your service target, sigma_d is demand standard deviation, and LT is lead time. If lead time also varies, use the extended form that includes the sigma_LT term, since ignoring lead-time variance is the most common understatement.

What is the difference between cycle service level and fill rate?▼

Cycle service is the probability of no stockout per replenishment cycle, while fill rate is the share of demanded units actually served. Formulas typically compute cycle service, but contracts usually specify fill rate, so confusing the two can hide penalty-clause risk.

When does the normal safety stock formula fail?▼

The normal formula fails on SKUs with a coefficient of variation at or above 1.0 or with intermittent (lumpy) demand, where it understates risk precisely on the items that hurt most. For those items, use empirical or quantile-based sizing, or change policy to make-to-order or lead-time reduction.

How do I validate a safety stock calculation against real data?▼

Set stock at mean demand plus the computed safety stock and replay actual demand history, then measure achieved cycle service and achieved fill rate. Reconcile the stress-test denominator (total units demanded) against the raw data sum before trusting the results.

Should all SKUs share the same service level target?▼

No, a single global service target across the portfolio is a common pitfall. Targets should follow item criticality and margin, and comparing safety stock cost at 90/95/98/99% levels makes the price of higher service visible per class.

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