Answer:
choosing the level of safety stock that assures a given service level.
Explanation:
Safety stock is defined as the level of stock logisticians keep on hand to mitigate the risk of stockout as a result of uncertainty in demand and supply. It is the extra amount of inventory a company holds in case of depletion of stock due to unforeseen circumstances.
Safety stock is useful when the sales of a product exceeds expectations and when a supplier fails to deliver on time.
So safety stock should be chosen on the basis of providing a given service level to customers without getting stockout.
