Name: AI Demand Forecasting Lab
Author: MySimulator

Stocking policy

Safety stock buffer: 15%

This case study models 26 weeks of demand for a seasonal retail product, forecasted with some error. Weekly stock is set to forecasted demand plus a safety buffer. Too little buffer risks stockouts (lost sales); too much buffer risks overstock (holding cost, markdowns, waste).

26-week outcome

Weeks with stockout—

Total units held excess—

Net inventory cost—

Actual demand (solid) vs. stock level (dashed)