An approach to stock cover indicator

Abstract

Stock cover is presented by a key performance indicator calculating the number of days of forecasted consumption which the current stock level can face. The identified problem in production companies, when calculating the 'Stock Cover' indicator companies opt for one of three ways, among which there are large deviations in planning frequency and launching the orders for procurement or/and production, as well as a wide aberration in the volume of customer orders; which directly affects costs and competitiveness of enterprises. The idea of the authors of this study was to make 'Stock cover' indicator and 'Balanced Stock Cover' to be more adequate, and at the same time more efficient and effective in the operational management of a company.