What type of inventory is built to counter predictable variability in demand?

The correct answer is anticipation inventory. This type of inventory is specifically built to meet expected or predictable fluctuations in demand. Organizations anticipate changes in customer demand due to trends, seasonal patterns, or promotional activities and stock up on these items ahead of time to ensure they can fulfill customer needs without delay.

Anticipation inventory helps businesses manage their supply chain efficiency by allowing them to meet expected demand peaks. For instance, a toy manufacturer might increase its inventory of popular toys leading up to the holiday season, based on historical sales data that indicates a surge in demand during that time.

Other types of inventory serve different purposes. Cycle inventory pertains to the quantity of inventory that is built up to replenish stock regularly, based on normal demand during a certain time period. Safety inventory, on the other hand, is kept as a buffer against uncertainties in demand or supply, rather than predictable changes. In-transit inventory is the stock that is on the way to its next location and is not yet available for sale or use, further differing from the concept of anticipation inventory.