Taking inventory, what term describes the extra stock kept to avoid stockouts?

• A. Safety stock
• B. Parstock
• C. Reorder point
• D. Just-in-time

Answer: (C)

The buffer inventory kept to guard against unexpected demand or supply delays is safety stock. It serves as a cushion so you don’t run out during variability in usage or longer-than-expected lead times. Reorder point, on the other hand, is the level at which you place a new order to replenish stock; it’s a trigger based on lead time and expected consumption, and it may incorporate some buffer indirectly, but it is not the extra stock itself. Just-in-time aims to minimize inventory, while par stock sets planned minimums, but the specific term for the extra stock kept to prevent stockouts is safety stock.