Commonly, safety stock is held at a time when there is doubt in the lead time or demand level for the item. Students can rely our Buffer inventory homework writing service to avail A+ grades in their exams.
The Need for Buffering
The need for buffering arises because it accounts for inconsistencies in the manufacturing processes besides maximizing profits and efficiency. Actually, buffering would be meaningless when variability is absent. Nonetheless, when variability is present, then it becomes important to make use of buffering for diminishing the influence of these variables.
With the help of buffering, manufacturers become capable of altering their processes via manipulating capacities, times, and inventories. For instance, you can consider a bottleneck system where an upstream station breaks down frequently. For keeping the line functioning, the manufacturer is liberal to place a work in place of inventory at that station for maintaining optimal production levels.
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Reasons for Carrying Buffer Inventory
Buffer stock inventory is something which has become a necessity and there are some vital reasons for which small and mid-sized businesses do carry buffer inventory.
- Shield against unanticipated variation in supply – If, by chance, your supplier is closed for one week or when there is a disruption, then you do not waste time in fulfilling orders to your customers with buffer inventory as supply chains are more globalized and longer with more forces leading to disruptions than before.
- Reimburse for forecast inaccuracies – Maybe you possess a steady demand for a specific item but you end up selling more compared to what you had forecasted for a month, then with buffer inventory, you do not sacrifice the level of your customer service while you refill.
- Averts disruptions in deliveries or manufacturing – The need for buffer inventory is making sure that your customer service levels remain high and your supply chains too run smoothly. And so, when the safety stock is intact, your workers will not run around to locate and rearrange parts constantly.
- Avert stock out for keeping customer satisfaction and service levels high – Buffer inventory also aids in keeping your supply chain and warehouse run smoothly and its goal is ensuring that your customers are contented.
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