APICS Certified Supply Chain Professional (CSCP) — Question 91

Which of the following statements represents a major assumption needed to effectively use days of supply as a measure?

Answer options

• A. The reorder point for the inventory has been calculated correctly.
• B. The forecast for the item usage is reasonably accurate.
• C. The item is in the growth phase of the product life cycle.
• D. The item is subjected to statistical process control (SPC) during production.

Correct answer: B

Explanation

The correct answer is B because having a reasonably accurate forecast for item usage is essential for calculating days of supply effectively. If the forecast is inaccurate, it can lead to overstocking or stockouts, making the measure unreliable. The other options, while important for inventory management, do not directly relate to the accuracy of the supply measure itself.