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AI agent for inventory managers

Safety Stock Recalculation Agent

Safety stock that meets service targets with the least inventory

AnalysisAutomationOperationsManagement
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Safety Stock Recalculation Agent: what goes in, what the agent does and what you get

What it does

Safety stock protects against demand and supply swings, but the settings in the system are often years out of date. Each quarter this agent pulls demand, forecast error and supplier lead time data, including how much lead times vary, not just the average. It computes safety stock for each item's target service level, and uses an intermittent demand method for items with lumpy demand. It then simulates the last six months to see how many stockouts and how much extra stock each new setting would have produced. If a setting would not have met the service target, it adjusts the setting or method and simulates again. It summarizes changes with their inventory value impact. Changes over $10,000 need the planner or inventory manager's approval. Edge case: an item whose supplier changed recently uses only lead times from the new supplier.

How it works

Follow the arrows from top to bottom. The orange dashed arrow is the loop: when a check fails, the agent goes back and tries again.

Start and resultWhat it doesA check on its own workWaits for your OKGoes back and retries
Yes, continueApprovedNo 1 STARTS WHEN Quarterly review 2 USES A TOOL Pull demand, forecast error and lead time data 3 DOES Calculate new safety stock per item 4 USES A TOOL Simulate the last six months with new settings 5 CHECKS THE RESULT Would the new setting have met the service target? If not: adjust the setting or method and simulate again.Back to step 3. 6 DOES Summarize changes with inventory value impact 7 YOU APPROVE Planner or inventory manager approves changes 8 RESULT Updated safety stock list for upload
Read the steps as a list
  1. Quarterly review
  2. Pull demand, forecast error and lead time data
  3. Calculate new safety stock per item
  4. Simulate the last six months with new settings
  5. Would the new setting have met the service target?If not: adjust the setting or method and simulate again. Back to step 3.
  6. Summarize changes with inventory value impact
  7. Planner or inventory manager approves changesThe agent waits here for your OK.
  8. Updated safety stock list for upload

How it decides

It uses forecast error and lead time variation for the target service level, and switches method for items with intermittent demand.

  • Lumpy items use an intermittent demand method
  • Changes over $10,000 in value need approval
  • Lead time variation is included, not just average

Make it yours

Every agent is a starting point. You choose these settings for your own situation.

  • Service level by item class
  • Value limit for approval
  • Simulation window (default 6 months)
  • Method for lumpy demand

What keeps you in control

It always asks you first

  • Uploading new settings
  • Changes above the value limit

Hard limits

  • Never uploads settings itself
  • Never lowers safety stock on items flagged critical without approval

It stops when

  • Done: approved settings uploaded by the planner
  • Stop: lead time data missing for a supplier

Set it up

We guide you through the set-up, step by step

Members get the full set-up guide for this agent. No technical skills needed: you copy, paste and upload.

10 minto set it up in your AI
5 AIsChatGPT, Claude, Copilot, Gemini, Grok
  • One set of instructions to paste into your AI, with the clicks for ChatGPT, Claude, Microsoft 365 Copilot, Gemini and Grok
  • The agent then walks you through connecting your own data, one source at a time
  • A downloadable copy with the flow chart, the rules and the full guide
Get access to this agent

An example run

What happensIn the Q1 review, new settings for 2,400 items cut total safety stock by $310,000. The simulation check failed for 46 items, which would have missed their 98 percent target because one supplier's lead time swings had grown from 4 to 11 days. The agent raised those settings and reran the simulation, which met the target. The inventory manager approved 38 changes over $10,000.

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