Forecast Performance To Set Safety Stocks

1) The document discusses using forecast performance to set safety stock levels in supply chain management. It explains that safety stock is used to prevent customers from being affected by variations in plans. 2) Two key challenges with relying solely on days of forecast to set safety stock targets are intermittent, unpredictable sales and inaccurate promotional forecasts. Setting targets at zero when forecasts are zero can risk shortages for intermittent items. Promotional forecasts are often overstated, inflating safety stock targets unnecessarily. 3) The document recommends not relying solely on days of forecast and instead taking sales patterns and forecast accuracy into account to set more appropriate safety stock levels.