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The Effect of Capacity Limitations on Safety Stock

John Mapes (Cranfield School of Management, UK)

International Journal of Operations & Production Management

ISSN: 0144-3577

Article publication date: 1 October 1993

542

Abstract

When a production system is operating at close to capacity then, after a period of high demand, it may take some time to restore stocks to the level necessary to provide a given level of stockout risk. During this period the risk of a stockout will be higher than intended. Uses simulation to show how customer service levels fall dramatically as average production levels approach available capacity and to determine the increases in levels of safety stock necessary to maintain desired customer service levels when capacity is limited.

Keywords

Citation

Mapes, J. (1993), "The Effect of Capacity Limitations on Safety Stock", International Journal of Operations & Production Management, Vol. 13 No. 10, pp. 26-33. https://doi.org/10.1108/01443579310045536

Publisher

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MCB UP Ltd

Copyright © 1993, MCB UP Limited

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