Discover how Stockout Rate measures how often products are unavailable when customers want to buy. Learn how to track, analyze, and reduce this KPI to improve inventory control and customer experience.
Marketing, Ecommerce
Lagging Indicator
Stockout Rate (%) = (Number of Stockout Events / Total Demand Events) × 100
Tracks how frequently a product is out of stock when there is customer demand, helping businesses reduce missed revenue and improve fulfillment reliability.
Shopify, NetSuite, Zoho Inventory, QuickBooks Commerce, Oracle Netsuite, Microsoft Dynamics, ERP & POS systems.
Tracked weekly or monthly to catch supply chain or inventory issues early and adjust forecasting or replenishment strategies.
Reduce stockout rate to below 2% in Q3 by improving demand forecasting, optimizing reorder points, and enhancing supplier coordination.
An Inventory or Supply Chain Manager tracks Stockout Rate to identify frequently unavailable items. If the rate is high for top-selling products, they may adjust safety stock levels or set automated restocking alerts.
Use automated systems to monitor stock levels and prevent unexpected stockouts.
Base forecasts on historical sales, seasonality, and promotional planning.
Establish minimum inventory levels that trigger replenishment automatically.
Avoid delays by working with multiple vendors and planning for variable fulfillment windows.
Stockout Rate measures the percentage of times a product is unavailable when customer demand exists. It is a critical KPI for industries like e-commerce and manufacturing, providing insight into the effectiveness of inventory management and a company’s ability to meet customer needs. A high stockout rate can signal poor inventory planning, leading to lost sales, decreased customer satisfaction, and potential damage to brand reputation. Monitoring and improving this metric is essential for ensuring operational efficiency and maintaining strong customer relationships.
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