Operations research models and methods for safety stock determination: A review

• Main Authors: João N.C. Gonçalves, M. Sameiro Carvalho, Paulo Cortez
• Format: Article
• Language: English
• Published: Elsevier 2020-01-01
• Series: Operations Research Perspectives
• Subjects: Safety stocks; Operations research; Systematic literature review; Inventory management; Supply chain
• Online Access: http://www.sciencedirect.com/science/article/pii/S2214716020300543

In supply chain inventory management it is generally accepted that safety stocks are a suitable strategy to deal with demand and supply uncertainty aiming to prevent inventory stock-outs. Safety stocks have been the subject of intensive research, typically covering the problems of dimensioning, positioning, managing and placement. Here, we narrow the scope of the discussion to the safety stock dimensioning problem, consisting in determining the proper safety stock level for each product. This paper reports the results of a recent in-depth systematic literature review (SLR) of operations research (OR) models and methods for dimensioning safety stocks. To the best of our knowledge, this is the first systematic review of the application of OR-based approaches to investigate this problem. A set of 95 papers published from 1977 to 2019 has been reviewed to identify the type of model being employed, as well as the modeling techniques and main performance criteria used. At the end, we highlight current literature gaps and discuss potential research directions and trends that may help to guide researchers and practitioners interested in the development of new OR-based approaches for safety stock determination.