Rationing of finished product inventories. Safety stock Method for calculating safety stocks

In retail, hot items must always be in stock. Not only the level of daily revenue, but also the loyalty of regular customers depends on its presence. Therefore, the warehouse should always have a safety stock of popular products in case of increased demand or delivery delays. However, the amount of reserve should not exceed a reasonable limit, because unused balances reduce the profitability of current assets.

Difficulty in determining optimal stock levels

According to the well-known Japanese rule: the larger the balance in the warehouse, the worse the management performs. Therefore, it is important to be able to competently.

To clearly understand the significance of this factor, you can come to the warehouse and look at the products as if they were wads of money. They lie, and only part of them constantly turns into profit. Slow and surplus goods simply freeze a certain portion of working capital that could be kept on deposit in a bank and generate income.

In addition, excess inventory can also generate losses. This happens due to:

freezing money in unclaimed reserves;
costs of renting a warehouse or its depreciation;
remuneration for excess storekeepers;
theft;
expiration of the product's shelf life;
expenses associated with changes in the popularity of goods.

However, the lack of certain items in stock also has its negative sides:

decrease in revenue;
image losses of the store;
additional purchases of products at inflated prices.

As a result, store managers must form a safety stock that would minimize the costs of investing in working capital and, at the same time, would not lead to a shortage of goods. To do this, you need to understand in detail the factors influencing the level of warehouse reserve.

Safety stock and factors influencing it

Safety stock is a certain amount of goods in a warehouse that is necessary to cover demand in unforeseen circumstances. Using a reserve in a store, you can solve two problems:

ensure product availability in case of unexpectedly increased demand;
prevent product shortages when delivery of the next batch is delayed.

To solve these issues, you need to know the factors that influence the calculation of the level of safety stock. These include:

Daily sales volume. Its level can fluctuate on different days of the week and seasons, so safety stock calculations are often made taking into account the standard deviations of this indicator.
Product delivery period by the supplier. The less often products are brought to the warehouse, the greater the level of safety stock should be. In addition, it is advisable to take into account the frequency of delays in product deliveries.
Possibility of storage facilities and special equipment. It is not always possible to fit all planned supplies into a warehouse, especially in freezers. In such cases, it is necessary to distribute free space between the most profitable products.
Product properties. In some cases, the shelf life of products does not allow the formation of an adequate safety stock. In this case, a maximum reserve is formed that does not cause losses.

When calculating safety stock indicators for each assortment group, it is necessary to take into account all of the listed factors. In addition, you should constantly analyze where it is more profitable to direct working capital - to expand the range or to form commodity reserves.

Methods for calculating safety stock

In a retail store, there is no point in resorting to complex logistics formulas to determine safety stock levels. All calculations should be available to a simple entrepreneur in an Excel file.

The most popular methods for determining the safety stock of goods are:

Method based on daily consumption level and standard delivery time.
Method based on a certain percentage of planned demand.
Manual or empirical method.
Method based on standard deviation.

Percentage of demand method

This method is based on a simple formula. Initially, it is used to determine the volume of sales in quantitative terms for the period between individual deliveries. It is subsequently multiplied by an arbitrary percentage. The result is the volume of safety stock, which ideally should remain in the warehouse at the time of the next delivery.

The formula looks like this:

Safety stock = (XX%*forecast sales volume for the period between deliveries)/100%

For example, a truck with goods arrives at the warehouse every 2 weeks, during which time 100 kilograms of sugar are sold. According to the head of a retail store, fluctuations in demand for it do not exceed 20%. As a result, the safety stock will be equal to:

(20%*100kg)/100%= 20kg

That is, at the time of the next delivery, 20 kilograms of sugar should remain in the warehouse.

This method of calculating safety stock is well suited for everyday goods with small fluctuations in demand and stable supplies.

But if the supply of products is rare, the reserve calculated in this way may turn out to be too large and impractical. Therefore, for different categories of goods they use their own percentage in the formula. The longer the delivery time, the smaller it will be.

It must be remembered that customers will always understand the absence of rare and slow-selling products, especially if they are asked to place a guaranteed pre-order for it.

Method based on sales volume and delivery time

This method involves the formation of a safety stock for a certain number of days. The basis for its calculation is the average daily demand and the delivery delay period.

For example, a car with goods arrives in the city only on Mondays, but the store places orders once every two weeks. If delivery is not made on time, the retail outlet will be forced to work without goods for another 7 days. In order not to be left without products during this time, you need to have a week's safety stock. Its volume is calculated by the formula:

Safety stock = average daily demand * number of days between deliveries

This method is convenient for cases where supplies are strictly rhythmic and demand is stable. This situation often arises when delivering products with a long shelf life to the regions.

In some cases, the safety stock using this method is calculated based not on the average daily demand, but on the maximum. Thus, it is 99% guaranteed that the store will be provided with everything necessary until the next delivery.

Specifying safety stock manually

In case of unstable demand and rare supplies, the manager can manually determine the level of safety stocks for certain products. Typically, employees are guided by customer sentiment and market conditions.

With the manual method of forming safety stocks of goods, mandatory control over the actions of the manager by management is required. After all, a subjectively made decision can freeze current assets in a warehouse for a long time. In such cases, it is necessary to encourage customers to notify the store in advance of their needs so that they can order and reserve the products they need.

Standard Deviation Method

The most effective method for retail stores is to calculate safety stock based on the standard deviation of demand and the delivery period. The method has a rather long formula, but it is compiled once in Excel within 5 minutes, and then the values are simply substituted into it.

The formula looks like this:

where Z is a coefficient showing the confidence level, σD is the standard deviation of the level of inventory consumption for a certain period, μL is the average order fulfillment time, μD is the average level of inventory consumption for a certain period, σL is the standard deviation of order fulfillment times.

The standard deviation is calculated in Excel using the “STANDARD DEVIATION.G” function and does not take much time. Different values of the Z coefficient provide different degrees of satisfaction of customer demand. At Z=1 the probability of satisfying demand is 84%, at Z=1.65 - 95%, at Z=2.33 - 99%.

Thus, with a decrease in the risk of mismatch between demand and supply, the level of safety stock will increase sharply. Each entrepreneur decides what value of the confidence coefficient to choose at his own discretion.

To determine various indicators and analyze sales, it is advisable to use p in the store. It can provide the entrepreneur with many visual tools for administering the business and increasing its profitability.

The choice of a specific method for calculating safety stock is made based on the specifics of the retail store. You can perform analysis for each product item, product group, or within one supplier. The main thing is that buyers can always buy the necessary goods, while entrepreneurs invest a minimum of money in working capital.l

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It is proposed to use different methods: analytical, normative, calculation-statistical, etc. A number of specialists working in this area have significantly different opinions on some issues of stock rationing, for example, one or different methodological approaches should be used when rationing stocks in physical terms and working capital invested in these same stocks, which the rate itself should be equal to the maximum or the average value of the used stock. In the rationing methodology, there is no single and generally accepted approach to determining the current and insurance components of the stock norm; the issue of the purpose of the safety stock and the fundamental possibility of calculating it are discussed. There is no description of physically based calculation models of variations in current and safety stocks, in which a strict logical and mathematical connection would be traced between the change in the components of the stock in the intervals and the cumulative influence of the standard-forming factors acting on them. Different points of view are also expressed about which method of stock regulation is more competent, what initial information is advisable to use to calculate the specified stock rate, etc.

In all works, except for two methods - and , as well as in the dissertation of A. Vozhov, the influence on the value of the insurance component of variations in the daily volume of supplies of a standardized grade of material at the enterprise is not taken into account (see Table 3.2), which in the general case can be quite large and has a strong impact. At the same time, as follows from the formulas given in table. 3.2, except for three works - , and , the influence of variations in the intervals between releases of inventory items at the enterprise is not taken into account at all. A number of methods and economic literature on stock rationing do not consider the following, in our opinion, fundamental question: what is the source of the formation of current and safety stocks for consumers in the intervals between deliveries. All this together does not allow us to formulate scientifically based approaches to calculating standards.

These ten options cover all possible conditions for the formation of inventories at enterprises with a regular supply process (transit, warehouse, mixed deliveries) of the MR brand and a regular process of its consumption. All these calculations are performed using approximately the same technology - minor differences concern only the methods for determining changes in current and safety stocks in intervals when it is necessary to take into account different numbers of standard-forming factors. The algorithm for calculating norms for these ten methods is described below.

For transit deliveries.

The calculation of the current and insurance components for warehouse supplies is carried out similarly to the determination of the specified standard of production inventory for transit supplies, as noted earlier. Based on the calculated components, the specified norm of the production stock of the standardized brand of material resource for the mixed form of supply is found in physical terms

The calculation of the average interval between deliveries and the average excess over it when determining working capital standards in the current and safety stocks of raw materials and basic materials is based on the same data on the time of receipt of material assets. This makes it possible to combine both calculations. In the combined calculation, the average interval between deliveries and the average excess over it are determined using the same methodology as in separate calculations (see 7 and 10).

If the values of Tti G. are expressed in days, then to calculate the norm of the current and safety stock in physical terms, the dependencies are used

After calculating current, preparatory and safety stocks

In accordance with the above factors, to calculate the value of P.z. It is generally accepted that it is advisable to consider them as a combination of three components of the current stock, the preparatory stock and the safety stock.

The first (preparatory) part of the reserve usually has little weight and is the easiest to determine; the method of its calculation is quite well worked out in industry instructions; the second and third parts (current and insurance) are more difficult to find. When calculating the preparatory component, the industry specifics of the preparatory operations performed with the MR brand before launching into production are taken into account; for example, unloading, storage, straightening, aging, crimping, bundling, etc.

In addition to current and insurance, at enterprises remote from the railways, so-called seasonal reserves are created, which are caused by the need to import certain materials by water during navigation. Seasonal reserves are calculated by multiplying the average daily requirement for this material by the period of the seasonal break.

In table 9.1, 9.2 provide formulas for calculating the norms of current and safety production stock, taken mainly from the work of A. R. Rodionov and R. A. Rodionov Logistics Rationing of sales inventories and working capital of an enterprise.1 Calculation of stock norms using the formulas of Table. 9.1 and 9.2 assume the availability of statistical data on supplies and consumption.

In the methodology that was in place until recently for rationing production inventories and working capital invested in them (for example, in , , , , , , etc.), calculation models for the formation of the components of the stock - current and insurance stocks - were not sufficiently developed. It was not determined why the latter are needed, how they are formed and consumed in intervals, and accordingly, no justified algorithms for their calculation were proposed. When determining production inventory standards, the unevenness of the volume of daily expenses 2 and the degree of inconsistency between the processes of receipt3 and consumption were not taken into account at all. And this, as will be shown below, is one of the main

An attempt was made to create a modeling algorithm for determining the optimal level of inventory of a brand of goods and materials in a warehouse, at which the sum of storage costs and losses from shortages in the absence of material in the warehouse will be minimal. An experimental calculation performed by the authors showed the effectiveness of using the statistical test method for planning inventories in warehouses of logistics authorities. The calculated stock level includes both current and safety stocks (suggestion by B. Geronimus, see Table 3.2). In terms of its economic approach to calculating standards, the method is very interesting, but has not yet received further distribution due to certain difficulties in obtaining a number of necessary indicators (for example, the cost of storing a unit of a particular material in an enterprise warehouse).

Intermediate between the two above cases are the conditions for the formation of a stock with a free (correlation) connection between variations in supply volumes and the total volumes of daily supplies for the interval. Under these conditions, the total volumes of supply do not fully, but to a certain extent, follow at intervals the volumes of supplies produced in them; if they delivered little, then there will be a small total consumption for the interval in this period, and vice versa. For these conditions, the calculated value of the correlation coefficient can be in the range from A0/

Insurance inventory

Insurance inventory

1. change in sales speed

2. delay in delivery of goods (this covers the risks of delays in production from the supplier, delays in delivery or cargo clearance - in general, risks throughout the entire order fulfillment cycle)

In practice, insurance inventory rarely lies idle. Therefore, when calculating orders, the supplier must take into account each time that by the time the next batch of goods arrives, safety stock must remain in the warehouse. That. This value has a direct impact on the calculation of orders to the supplier. Safety stock is also an important component when calculating the planned turnover of goods.

Insurance inventory

Insurance inventory - This is a reserve that is constantly in the warehouse in case of unforeseen circumstances. Most often, safety stock is used to cover the risks of a shortage in the following situations:

change in sales speed
delay in delivery of goods (this covers the risks of production delays at the supplier, delays in delivery or cargo clearance - in general, risks throughout the entire order fulfillment cycle)

SO WHAT SHOULD THE SAFETY STOCK BE?

There are many formulas for calculating safety stock, but many of them are cumbersome and in the middle of the calculations you forget what happened at the beginning.

First of all, the safety stock should be different for different items. That is, at the beginning of the calculations, it is recommended to conduct an ABC analysis of the commodity matrix and then determine its own safety stock for each of the groups.

It is most convenient to calculate insurance as a coefficient of average monthly sales, because In this case, when the sales speed changes, the insurance coverage will also change. This will help avoid situations where, for example, demand has dropped by half, but the warehouse continues to be supported by insurance in large quantities.

That. It turns out that the most difficult thing is to determine the safety stock ratios (based on average monthly sales).

First factor, from which the coefficient is formed, is the delivery time of the goods (including the production cycle, delivery, clearance, acceptance of goods in the warehouse), i.e. The time from the moment of ordering to the moment the product goes on sale. Let's say we define it in months (for example, 0.5 = 2 weeks, 1.5 - one and a half months, etc.). Next, it is necessary to determine the deviation in delivery times. It can be taken actual (for this you need to analyze the receipts of goods for recent periods and calculate how long they deviated from a certain standard delivery time) or calculated expertly (for example, according to my feelings, delivery is delayed by an average of a week, and the total delivery time is 6 weeks . i.e. we get a deviation of 1/6 = 0.17).

Then we multiply the deadline in months by the deviation (for example, 1.5 * 0.17 = 0.26). We get 0.26 - this is the first part of the safety stock ratio, which covers the risk of the goods being delayed for a week.

Second factor, from which the coefficient is formed - a possible deviation in the speed of sales towards an increase. Here you can also calculate the actual deviation of sales from the average or determine it expertly. For example, if sales deviate from the average by 30 percent, then the deviation is 0.3. After which we multiply the deviation by the delivery time 0.3 * 1.5 = 0.45 - this is the second part of the safety stock coefficient. Which covers the risk of increasing sales speed by 30%.

We multiply 0.71 by the average monthly planned sales and get the required safety stock.

HOW TO VARY SAFETY STOCK FOR DIFFERENT CATEGORIES OF GOODS?

For the category of goods of group B, it is necessary to determine, in the event of risks of delaying the receipt of goods or increasing the speed of sales, how well we want to ensure sales of this category. In practice, most likely about 80% of sales. That. the safety stock ratio for this group of goods will be 0.71 * 0.8 = 0.57.

For category C goods, the occurrence of a shortage is usually not very critical, so it may be sufficient to ensure 50% of sales in the event of risks. That. The coefficient for this group will be equal to 0.71*0.5 = 0.36.

For other categories, safety stock may not be created at all.

Important:The longer the delivery time for the product, the greater the jump in sales and the greater the risk of product delay, the more safety stock we need to have in stock.

Vetter's formula

The classic model of inventory consumption and replenishment is ideal with completely deterministic inventory management parameters. Most practical situations differ from the ideal scheme; they contain uncertainty caused by various reasons, but mainly by the random nature of daily demand d j and duration of the logistics cycle T i. The randomness of the main parameters of supply and demand, as well as logistics risks, are the reasons for the creation of safety stocks.

Analysis of various sources allowed us to formulate the following provisions:

1. The implementation of the current stock in the general case is a discrete, non-increasing random process, reflecting the non-stationarity and stochasticity of demand (A, Fig. 8.1).

2. Supplies are random variables and are subject to certain distribution laws (B, Fig. 8.1).

3. The moment of completion of each sale is random, but in some cases the remaining stock at the time of delivery is greater than zero, in others it is equal to zero. In the absence of safety stock, the latter situation means the onset of a shortage (D, Fig. 8.1). If there is a safety stock, this situation can be called a “pseudo-shortage”, since demand is satisfied by the safety stock. From a probabilistic point of view, the distribution function of the current stock (at the time of delivery) will obey the truncated normal distribution law or the distribution laws for positive random variables (C, Fig. 8.1).

Fig.8.1. Inventory consumption and replenishment model taking into account demand uncertainty and order cycle time

4. When calculating the parameters of the inventory management system, the optimal order quantity (Harris-Wilson formula (5.6)) and the time between orders (formula (5.8)) are used. However, the formula itself was obtained under ideal conditions, which imposes additional restrictions on the possibilities of its use in order management. In addition, calculation using the Harris-Wilson formula is not always possible due to the difficulty and partly conventionality of determining the values included in it, for example, annual consumption, supply and storage costs, etc.

5. If at a time t j total daily consumption reaches the initial stock in the warehouse S oh, i.e. When a shortage situation occurs, it is assumed that unsatisfied requests continue to accumulate until a random moment T k- time of receipt of a new order. Thus, when ≥S o we are talking not about the real, but about the predicted process of accumulation of applications in the interval Δ T = T k - T j . Random accumulated shortages are used to estimate safety stock.

To calculate the amount of safety stock under conditions of uncertainty, the Fetter formula can be used:

, (8.1)

Where xp– parameter of the normal distribution law, corresponding to the probability of no shortage of products in the warehouse P(x)(Table 3.1, Fig. 8.2)

Average value of the duration of the functional cycle (time period between deliveries);

Average daily stock consumption;

σ T, σ d– respectively, standard deviations of random variables T And d.

Often, along with the coefficient x p (Table 3.1), the formula for calculating the safety stock uses the coefficient t β– table 8.1.

Table 8.1

Parameter Definition t β depending on the desired level of customer service

A) distribution density;

B) distribution function.

Rice. 8.2 Normal distribution law

Various sources offer several options for the relationship between the coefficient x p and t β for the safety stock and service level based either on the integral distribution function , or from density (Table 8.2).

Table 8.2

Relationship between service level and multiplier value

for safety stock

Service level with probability of no shortage P(x)	Coefficient value x p	Service level with a given probability of falling within the boundaries Р(tв), %	Coefficient value x p
0,5		-	-
0,55	0,125	-	-
0,6	0,253	-	-
0,65	0,385	-	-
0,7	0,525	-	-
0,75	0,675	-	-
0,8	0,842	-	-
0,85	1,037	-	-
0,9	1,28	0,8	1,282
0,92	1,405	0,84	1,404
0,94	1,555	0,88	1,554
0,95	1,645	0,9	1,643
0,96	1,75	0,92	1,75
0,98	2,05	0,96	2,053
0,99	2,3	0,98	2,325
0,999	3,1	0,998	3,29

Our computational experiment allowed us to draw the following conclusion.

Sergey Piterkin, director of the Rightstep company, consultant, CPIM.

From an interview with Sergei Chemezov, head of the Russian Technologies state corporation, to the Vedomosti newspaper on May 28, 2009:

— What is the main problem for Russian Technologies enterprises now?

— I see it in the lack of working capital. The price of loans has become simply insane. There is no other way to say it. Now there is a dangerous trend: business executives agree to take out loans on any terms, both at 28% and 30%. Especially in the regions. I ask, how are you going to give the money? They answer: we will take it while they give it, so that production does not stop.

Introduction

While senior government leaders are racing to report the end of the crisis, arguing only over wording about whether these are “weak shoots” or “gradual strong growth,” enterprises in the real industrial sector are still, if not more, experiencing problems with free working capital. means. And, according to ingrained habit, they are trying to solve them not by eliminating the cause of the shortage of turnover, but by “poultices” - through lending. “What should we do, we must somehow ensure production and fulfill orders?”

At the same time, according to the personal observation of the author, who advises a significant number of Russian manufacturing companies, few people, even now, turn their attention to production and supply, those departments on which the presence or absence of “real” money at the enterprise depends. It is necessary to “treat” there; the financial department and accounting have nothing to do with it!

Why is this happening? Largely because the words “inventory optimization” bring to mind the “ghosts” of huge projects for installing IT planning systems, or Lean, or something else that both our and foreign “would-be-consultants” like to offer. No, the author is not against all these miracles of management thought. Moreover, one way or another, sooner or later, our enterprises will have to implement them, at least the rational parts of all these methods. But their implementation requires both time and money. Is it possible to do something quickly? And on your own? In order to significantly reduce the credit burden on the company in a couple of months?

For most businesses - yes! And we need to start with the simplest - from the basics inventory management And . More precisely, from checking and subsequently changing the principles of their management. Namely, from changing the principles for calculating the size of safety stocks, purchase and launch batches. From what can be implemented using MS Excel by the enterprise. And relatively quickly.

General provisions. Where do excess supplies come from?

By excess we mean stocks of materials, components, raw materials, parts and assembly units and finished products for which the client will not pay in the near future. Respectively not superfluous- those inventories that are purchased or produced for a specific customer order. After this definition, the source extra reserves, and therefore frozen money, which the enterprise so lacks, it becomes extremely clear and understandable: 1) “optimal” batches of purchases and production, 2) “safety” stocks, 3) production and purchase of what is not needed in the near future .

The last reason (purchase and production of unnecessary things), unfortunately, cannot be solved quickly - this requires establishing normal planning, changing the compensation system for production personnel, etc. This will be discussed in the next article. However, a significant and rapid economic effect for many machine-building and instrument-making enterprises can be achieved by optimizing the first two sources of excess inventory. Namely, the transition from informal procedures for determining the “safety” stock using the following methods: “finger in the sky”, “double delivery period”, “there’s not enough stock in the pocket” and “everything will come in handy in a “normal” economy”, and determining the optimal purchase/launch batch using the following methods: “Larger batch of purchase - lower price”, “Larger batch of launch - more efficient use of equipment - we’ll make more shaft - we’ll get more piece money” to formal calculation procedures.

If earlier such practices could be found at least some justification (rising prices, increasing production volumes, which would eat up all costs), now in order for an enterprise to survive, it is necessary to be lean in the truest sense of the word, i.e. thin and skinny, “without fat” - read - reserves.

Calculation of safety stock

Let's start with the “simple” one - by determining the level of safety stocks. Attention, not to be confused with insurance reserves, the purpose of which is to prevent production downtime! The task is now relevant for enterprise units operating in large series.

Service Levels

Service level (or reliability level) = the probability of finding the required part/material in the warehouse at the required time and in the required quantity. Or, more simply put, the percentage of plan completion.

Most of our enterprises do not even know what a service level is, and that it is exactly what it should be based on when determining the safety stock. But, after a short explanation, they prefer to give a figure close to 100%. This means: 100% compliance with the production/shipment plan in terms of quantity and time. In practice this is achievable. But, only with huge levels of safety stocks. In fact, the level of service at most Russian machine-building/instrument-making enterprises fluctuates in the range of 50 - 70%, and not higher.

There are several empirical methods for calculating the target service level, one of which (the “critical proportion”) is given below.

Service level = Critical proportion = Cv/(Cv+Co),
Where:
Cv - depletion cost
Co is the cost of holding inventory.

The cost of inventory depletion usually includes such values as the cost of order cancellation or penalties, the cost of losing a customer, the cost of emergency work in production, the cost of overtime, the cost of personnel (dispatchers) constantly engaged in “pulling out” “burning” positions, etc. . Cost of holding inventory - cost of capital, storage losses, warehouse maintenance, etc.

The actual level of service is determined relatively simply:

for production: the ratio of the number of products (finished products or finished parts) produced on time to the planned quantity. Or, the actual percentage of plan completion (in quantitative terms);
for purchased materials and components: the ratio of materials and raw materials delivered on time (in terms of time and quantity) to the total quantity ordered.

With a large range of products, service levels are determined for groups of parts and assemblies, finished products, and materials. The target service level should not be set at a very high level right away. For Western, European and American enterprises, 95% is considered a very good indicator. For ours, you can start with 80-85.

Uncertainty factors: what to insure against

For a manufacturing enterprise, the uncertainties, to compensate for the impact of which the safety stock is introduced, will be as follows.

Uncertainty of external demand (in quantity) - uncertainty (error) of the forecast.
Uncertainty of production (in time and quantity) is the spread of actual completion time relative to the planned one.
Uncertainty in supplies is the spread of actual deliveries of materials and components, in terms of quantity (misgrading and/or defects) and time.

To achieve reliable and stable operation of an enterprise, it is necessary to strive to minimize these uncertainties. Because in real life it is almost impossible to nullify the influence of all factors; it is necessary to calculate and enter the safety stock for each of these factors separately. Using the simple formulas and procedures given below for this.

Calculation of safety stock of standardized units and/or finished products produced according to demand forecast

The calculation of the safety stock of standardized units and/or finished products to cover demand uncertainty is carried out by calculating the forecast error. Accordingly, safety stock, as such, is determined for groups of finished products, and its value depends only on the accuracy of forecasting at the selected level of system service.

The procedures for calculating safety stock are as follows.

Identification of product groups that have the same demand pattern.
Calculation of forecast for product groups. Fact collection.
Determination of the standard deviation of actual demand from the predicted one:
σ 2 = (∑(F - A) 2)/N,
where F is the predicted demand, and A is the actual demand (in units of finished products) for the i-th period; N is the number of periods under consideration.
Determination of safety stock (SS) for a product group:
SS = σ * SF,
where SF is the insurance factor.

In case normal distribution of forecast errors, the value of the insurance factor for a given level of system service is taken from the tables (“insurance factor for different service level for the normal distribution of observational results"), contained in a large number of books on Probability Theory and Mathematical Statistics. Also, an example of a table is given below:

If forecasting errors are not described by a normal distribution, or if the enterprise does not have the required number of time observations, the value of the forecasting error can be used to determine the safety stock. In this case, the safety stock is not determined, but the forecast is increased by the relative error.

To smooth out the unevenness of demand within the period for which the forecast is determined, in the case when the production time of the product is not equal to the forecast period, the safety stock (see clause 4) is multiplied by an amount equal to the square root of the ratio of the production time to the period (frequency) of the forecast.

If the enterprise operates according to the type production-to-warehouse or some components and assemblies are produced according to this principle, it is advisable to manage the safety stock of products precisely through determining the demand forecast error. In this case, it is not the level of safety stock in the warehouse that is calculated, but the forecast error. Then the warehouse of finished parts/warehouse of finished products will always have the optimal one, based on the given service level safety stock of products, but its value will depend on the demand forecast and its error. The advantage of this method is that it is much easier to control the calculated forecast error (e.g. 12%). Then the necessary safety stock for products, depending on the level of demand (taking into account seasonality, etc.), will be calculated and maintained automatically.

Calculation of safety stock of standardized units or finished products to buffer production uncertainties.

The uncertainty factor in production is, first of all, time. Thus, from the point of view of buffering production uncertainties, the safety stock of standardized units, finished parts or finished products is determined by determining the safety production time. In this case, the production time increases by a certain insurance value, due to which a certain time buffer is formed for components or finished products, because in most cases, products will be produced slightly earlier than planned. The calculation procedures are similar to those described above.

Determination of product groups (or specific items) with general production time.
Comparing the planned production time with the actual one and determining the standard deviation.
σ 2 = ∑(P - A) 2 /N,
where P is planned time, A is actual time for the i-th production task; N - number of tasks.
Determination of insurance time (ST) for a product group: ST = σ * SF,

This time can be included in the product production route as an additional, fictitious operation. But it’s better as a special, “buffer” time.

Calculation of safety stock of purchased materials and components

The uncertainty factor in procurement is the time and quantity of delivery. Accordingly, for the time and quantity delivered, both the safety stock in quantity and the safety time are calculated. The calculation is made for each material item, or group of materials. In case of delivery of the same materials from different suppliers, the specified parameters are calculated for each supplier. The calculation procedures and algorithm are similar to those given above.

As can be seen from the above, such quantities as production time and delivery time do not appear anywhere in the formulas. Which is not surprising, because... We only insure against uncertainty, i.e. deviations in delivery time/quantity. Which depends not on the timing, but on the reliability (quality) of the internal or external supplier. Now ask how your MTS service calculates safety stock, if at all. In 90% of cases, the safety stock will depend precisely on the delivery time, representing a multiple of it. It’s amazing, isn’t it, where do we get these extra supplies?

Calculation of optimal purchase/launch batches

The size of batches of materials, components, parts and assemblies, optimal from the point of view of the economics of the enterprise, can be calculated using formulas for optimal order quantity (OQ). OOO is calculated based on the minimum total costs, including the cost of storing the material in a warehouse (the larger the batch, the longer it is consumed and the higher the total storage cost) and the cost of the order itself (delivery cost from the supplier, equipment setup cost, etc.)

The formula for calculating the optimal order quantity is as follows:

Optimal order quantity (OQ) formula = ,

where C O is the cost of processing each order (transportation, equipment setup time, etc.);
C H - the cost of storing a unit of inventory in a warehouse for one corresponding period of time (year, quarter, month). These costs may also include interest on the loan, which the company pays due to a lack of working capital equivalent to the corresponding volume of inventory;
D - annual (monthly or quarterly) requirement for material.

The above safety stock formula- the simplest and most convenient to use. There are more complex algorithms for calculating OOO, based on calculating the optimal order frequency, the optimal order quantity for a group of dissimilar products, etc. It is obvious that having “got a taste” for optimizing inventories, the company will eventually get to them.

Conclusion

As can be seen from the above, the technique of correctly determining the level of safety stocks and the size of optimal batches is simple, can be easily and quickly adopted by almost any enterprise that has at least one for the purchasing department, production planning, an employee with basic knowledge of higher mathematics and confident users of MS-Excel level IT systems.

The economic effect will be obtained immediately, from the start of using new techniques.