Supply Chain Fill Rate Estimator
Optimize inventory levels to meet service level agreements (SLA) and fill rate targets. Enter values for instant results with step-by-step formulas.
Frequently Asked Questions
What is service level in supply chain?
Service level is probability of not stocking out during lead time. 95% service level = 95% of replenishment cycles have no stockout, 5% experience stockout. Example: Order placed every 2 weeks (26 cycles/year). 95% service = stockout 1.3 times/year. Higher service (99%) = more safety stock = higher inventory cost. Lower (90%) = less inventory but more stockouts (lost sales, customer dissatisfaction). Balance: inventory cost vs. stockout cost. Industry varies: Walmart targets 98-99% (customer expectation high), B2B components may accept 90-95% (customers tolerate backorder).
What is fill rate vs. service level?
Service level: % of cycles without stockout (yes/no binary). Fill rate: % of units demanded that are immediately available. Example: Customer orders 100 units, you have 95 in stock. Fill rate = 95%. Service level = 0% (stockout occurred). Fill rate is stricter: partial fulfillment counts as failure for service level but 95% for fill rate. Target: Fill rate 95-99% (immediate availability). Measure both: Service level (cycle-based), fill rate (unit-based).
How do I improve fill rate without increasing inventory?
Options: (1) Reduce lead time (faster replenishment = less buffer needed), (2) Improve forecast accuracy (lower demand variance = less safety stock), (3) Consolidate SKUs (fewer variants = focused inventory), (4) Postponement strategy (finish-to-order for final customization), (5) Supplier collaboration (VMI, consignment), (6) Safety stock pooling (centralized vs. distributed). Example: Reduce lead time 30 → 20 days, safety stock drops 25% (same service level). Or improve forecast accuracy (demand σ 20 → 15), safety stock drops 20%.