How many units will be short when stockout occurs?

Abstract

In stochastic inventory management, when calculating the safety stock necessary to ensure a service level, use of the partial expectation function, which is tabulated in the normal demand case, is popular. Using these values, it is possible to calculate the safety stock necessary for the average of the items not served by cycle to reach the desired level. Analyses the use of a conditional probability distribution to ascertain the safety stock necessary to guarantee, when stockout occurs, that the average of the number of items not available equals a predefined value.

Citation

Adenso‐Díaz, B. (1996), "How many units will be short when stockout occurs?", International Journal of Operations & Production Management, Vol. 16 No. 4, pp. 112-118. https://doi.org/10.1108/01443579610114121