Glossary
What is Stockout?
Last updated July 2026
Definition
A stockout is running out of an item customers want to buy. Its true cost — lost sales, expedites, and churn — often runs 2–5× the value of the missed sale.
Stockouts are the reason teams over-buy safety stock, which then becomes excess. The fix isn't more stock everywhere — it's the right stock in the right place.
Inventory distortion (stockouts plus overstock) was estimated to cost $1.77 trillion in 2023, about 7.2% of retail sales.
Benchmark
True cost typically 2–5× the lost sale; expedites 3–10× normal freight.
Sources: Planster / IHL
Part of Working capital & inventory turns.
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