What is cycle stock?

• A. The portion of inventory that is replenished regularly to meet expected demand between orders.
• B. Inventory used only for seasonal demand.
• C. Inventory that is obsolete.
• D. Safety stock kept to mitigate demand variability.

Answer: (A)

Cycle stock is the portion of inventory that is regularly replenished to meet expected demand between replenishment orders. It represents the normal, usable quantity that is consumed as orders are filled until the next shipment arrives. In other words, it’s the amount you expect to use up in each cycle of ordering and consumption.

This is why the description fits best: you’re looking at the regular, routine part of inventory that is kept on hand specifically to cover normal demand during the time between orders. Other ideas—seasonal stock for peak periods, safety stock to guard against variability, or obsolete stock that’s no longer usable—describe different purposes and don’t define cycle stock itself.