What is the desired probability of not running out of stock called?

The desired probability of not running out of stock is known as the Customer Service Level (CSL). The CSL is a key performance metric in inventory management that reflects how well a company can meet customer demand without experiencing stockouts. It is expressed as a percentage and indicates the likelihood that inventory will be available to fulfill customer orders.

A higher CSL indicates a greater probability of having sufficient stock on hand, which is vital for maintaining customer satisfaction and loyalty. Companies strive to optimize their CSL based on factors such as demand variability, lead times, and inventory carrying costs. By setting a target CSL, businesses can align their inventory policies and stock levels to achieve an appropriate balance between service levels and costs.

The other options do not reflect the definition or concept of desired stock availability. The Weighted Moving Average (WMA) pertains to forecasting methods, the Economic Ordering Quantity (EOQ) relates to the optimal order size to minimize costs, and the Desired Probability Quotient (DPQ) is not a widely recognized term in inventory management or supply chain logistics.