Safety stock calculation is a critical process for businesses to ensure that they have enough inventory on hand to meet customer demands. The formula for safety stock calculation factors in the lead time, order frequency, and forecast accuracy required to effectively manage your inventory. Additionally, it considers how much of the product is expected to go out of stock during the lead time period and how much demand fluctuation is anticipated before the next supply replenishment. By understanding these variables and using the formula, businesses can determine what their ideal levels of safety stock should be to maintain customer satisfaction while minimizing storage costs.