The strategic reserve of inventory positioned between various phases of a manufacturing process or supply chain to lessen interdependencies is referred to as decoupling stock or decoupling inventory. Upstream and downstream processes can function independently because it serves as a buffer to absorb variations in production rates or delays. This helps avoid cascading disruptions and is especially helpful in complex production environments where one process may encounter delays or downtime. Decoupling inventory, however, needs to be properly balanced to prevent needless holding expenses.
