It is better to carry more safety inventory downstream if?
Understand the Problem
The question asks about the conditions under which it is better to carry more safety inventory downstream in a supply chain. It presents four options related to the cost of holding inventory and customer time sensitivity.
Answer
Inventory is inexpensive to hold and customers are time sensitive.
It is better to carry more safety inventory downstream if inventory is inexpensive to hold and customers are time sensitive.
Answer for screen readers
It is better to carry more safety inventory downstream if inventory is inexpensive to hold and customers are time sensitive.
More Information
Safety stock is used as a buffer against variations in demand or supply.
Tips
A common mistake is to select 'inventory is inexpensive to hold and customers are not time sensitive'. If customers are not time sensitive there is less need to carry more safety stock downstream.
Sources
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