Question 1

What is safety stock and how is it calculated?

Accepted Answer

Safety stock is buffer inventory held to protect against demand and supply variability. Safety stock = Z x sqrt(average lead time x demand std dev squared + average demand squared x lead time std dev squared). Z = 1.65 for 95% service level; 2.05 for 98%; 2.33 for 99%.

Question 2

What is total landed cost?

Accepted Answer

Total landed cost = FOB price + ocean/air freight + import duty + customs brokerage + inland freight + insurance + port handling + financing cost. It enables true comparison between sourcing options. A lower FOB price from a distant supplier can result in higher landed cost than a nearby but more expensive source.

Question 3

What is a supplier scorecard?

Accepted Answer

A supplier scorecard rates vendors across weighted KPIs - typically quality (defect rate), delivery (on-time %), cost (price competitiveness), and responsiveness (issue resolution time). Scores are weighted by importance and combined into a single rating for supplier ranking and development.

Question 4

Are these supply chain tools free?

Accepted Answer

Yes - completely free, no sign-up required. Results export to CSV or PDF.

Free Supply Chain Tools & Calculators

Supply chain calculators from source to shelf

Supply Chain Tools - FAQ