The Real Cost of Stockouts: Why Running Out Costs More Than You Think

You check your inventory. Your bestseller is out of stock. Again.

"No big deal," you think. "It's just one lost sale. We'll have more in stock next week."

But here's what actually just happened.

The Sale You Lost (And Can Count)

Customer walks in looking for Product X. You're out. They leave empty-handed.

Lost revenue: $45

That part is obvious. But it's just the beginning.

The Sales You'll Never Know About (And Can't Count)

That same customer came in planning to buy Product X plus a few other things while they were there. You just lost the entire basket.

Actual lost revenue: $127

Now multiply that by every stockout, every week, across every location.

The Customer You Just Lost Forever

Here's the real killer: 43% of customers who experience a stockout go to a competitor and never come back.

Not "maybe come back." Not "come back when you remind them."

Never. Come. Back.

That customer was worth $2,400 annually in lifetime value. You just lost them over one $45 product you didn't have in stock.

Real cost of that stockout: $2,400 in lost lifetime revenue

The Math That Should Terrify You

Let's say you have:

• 20 stockouts per month on popular items

• Average basket value: $120

• 40% of those customers never return

• Average customer lifetime value: $2,000

Monthly cost:

• Lost immediate sales: 20 × $120 = $2,400

• Lost lifetime customers: 8 customers × $2,000 = $16,000

• Total monthly impact: $18,400

• Annual impact: $220,800

And that's conservative.

The Invisible Costs You're Not Tracking

Brand damage: "They never have what I need"

Employee morale: Staff tired of apologizing to frustrated customers

Emergency orders: Rush fees and premium pricing to fix stockouts fast

Opportunity cost: Capital tied up in slow movers while bestsellers sit empty

Competitor advantage: Your lost customers are their new customers

The Gut-Feel Forecasting Problem

Most retailers reorder based on:

• "What feels right"

• "What we ordered last time"

• "Better safe than sorry"

This leads to:

• Overstock on slow movers (cash trapped)

• Understock on bestsellers (revenue lost)

• Reactive ordering (always playing catch-up)

What Accurate Forecasting Actually Looks Like

Imagine knowing:

• Exactly when you'll run out (2-4 weeks in advance)

• Exactly how much to order (no guessing)

• When demand will spike (holidays, weather, events)

• Which products are worth stocking deep vs. shallow

This is what AI forecasting does.

Real Example: Metro Liquor

Before AI forecasting:

• 45 stockouts/month on top 50 SKUs

• Lost revenue: $10,200/month

• Emergency orders: 8/month at 20% premium

After AI forecasting:

• 4 stockouts/month (91% reduction)

• Lost revenue: $800/month (92% reduction)

• Emergency orders: 0/month

Annual savings: $136,800

All from knowing what to order and when.

The Fix

Stop guessing. Start knowing.

U2xAI analyzes your sales patterns, predicts demand 2-4 weeks ahead, and alerts you before stockouts happen—not after.

Results in 30 days:

• 90%+ forecast accuracy

• Stockout alerts before you run out

• Optimal reorder recommendations

• Zero manual spreadsheet work

See results in your business in 30 days.

The Bottom Line

That stockout isn't costing you $45.

It's costing you $2,400 in lost customer lifetime value.

Multiply that by 20+ stockouts per month.

That's a quarter-million-dollar problem.

Or it was—until you fixed it.

Ready to stop losing customers to stockouts?