2007-03-13 00:50:14 · 4 answers · asked by jitendrasingh_mail 1 in Business & Finance ➔ Investing
suppose you have to deliver 100 pcs to your customer.
Your factory shall produce 200 pcs of the same material.
100 is kept as buffer stock in case the 100 you supplied got rejected or defective or not usable etc
Trust this helps
2007-03-13 00:53:40 · answer #1 · answered by suma 3 · 0⤊ 0⤋
In inventory control if x is the average demand and y is the standard deviation of demand, then y is the buffer stock. This is the extra amount of the product stocked so that there won't be any stockouts or lost sales due to stock outs.
2007-03-13 05:58:21 · answer #2 · answered by Mathew C 5 · 0⤊ 0⤋
The "buffer stock scheme" is an economic term, referring to the use of commodity storage for economic stabilization. Specifically, commodities are bought and stored when there is a surplus in the economy and they are sold from these stores when there are shortages in the economy. The institutional buying, storing and selling of commodities by a large player (e.g. a government) can take place for one commodity or a "basket of commodities". The stock of commodities stored act as a buffer against price volatility. If a basket of commodities is stored, their price stabilization can in turn stabilize the overall price level.
2007-03-13 01:00:53 · answer #3 · answered by TuRbOmAcH 1 · 1⤊ 0⤋
a stock of a basic commodity accumulated by a government when supplies are plentiful and prices low, and held for use when supplies are short to stabilize the price
2007-03-13 00:54:20 · answer #4 · answered by Engr. Ronald 7 · 0⤊ 0⤋