What is role of safety stock in an MRP system?
In inventory management, the objective is to keep optimum stock. The safety stock acts like a buffer in case of contingencies. Suppose the expected consumption in the week is 1000 units of a material, an additional safety stock of 100 may be kept for emergency purposes (so that there is no stockout) The MRP tries to match the requirements with the current stocks. The presence of safety stock will enable the planner to plan for more production (thereby using up the safety stocks) http://en.wikipedia.org/wiki/Safety_stoc…
