# Inventory Control — Overview of Stock Levels
Inventory control aims to balance two opposing objectives — having enough stock to meet production needs without tying up too much capital in idle inventory. Several stock levels are calculated to act as triggers and benchmarks.
## Stock Level Concepts at a Glance
| Level / Concept | Question it Answers |
|---|---|
| Re-Order Stock Level | When to order? |
| Re-Order Quantity / EOQ | How much to order? |
| Maximum Stock Level | Up to how much should we stock? |
| Minimum Stock Level | At least how much should we hold? |
| Average Stock Level | What is the normally maintained stock? |
| Danger Stock Level | Stock kept for emergency requirements |
| Buffer Stock | Stock kept to meet sudden demand |
## Conceptual Distinctions
### Re-Order Level (ROL) vs Re-Order Quantity (ROQ)
- ROL is a threshold — when stock falls to this level, place a fresh order.
- ROQ is the size of the order placed. EOQ is the optimal ROQ.
### Minimum Level vs Danger Level vs Buffer Stock
- Minimum Stock Level: the lowest stock you'd normally allow before reorders kick in — under normal operating conditions.
- Danger Stock Level: lower than minimum; reached only in emergencies and triggers emergency procurement.
- Buffer Stock: a safety cushion to handle unexpected spikes in demand or supply delays.
### Maximum vs Average
- Maximum: the ceiling — exceeding it leads to over-investment and obsolescence.
- Average = (Maximum + Minimum) / 2 — represents normal working stock level.
## Why This Matters
The whole purpose is to avoid stock-outs (which halt production) and avoid over-stocking (which blocks working capital and increases carrying cost). Each level is a control point on this spectrum.