The inventory of raw materials and finished goods of most companies engaged in product selling are critical to efficiently balance stock on hand and stocks for delivery. Setting inventory safety stock levels is a practice that most people undertake in varying situations, each depending on the type of product that they market, and depending on the productâ€™s life cycle. Surely, setting a stock safety level so that available goods and raw materials needed in selling and actual production of their specialty good will be a telling factor in the course of the business.
To avoid shortages or overstocking, a careful analysis of historical data of the inflow and outflow of goods must be properly studied. This is the only way to be able to set the stock level needed to allow an organization to function properly.
For more elaborate insights on inventories, here is a good link to setting Inventory Levels.