Construction and application of safety stock index based on MI-TVP-SV-VAR model

Abstract

As a part of stock, safety stock reduces the possibility of stock shortage and the cost of stock shortage, but the unreasonable setting of safety stock will increase the cost. This paper takes safety stock as the research object, introduces the financial field MI-TVP-SV-VAR model to construct safety stock index, and verifies the feasibility and effectiveness of the index through an example. The research results show that the construction of safety stock index can scientifically guide enterprises to set up safety stock, product production and resource allocation and investment, and help enterprises to make rapid response to market changes.