stockout cost

stockout cost definition - business

stockout cost

Revenue lost because a lack of inventory results in a firm being unable to fill all of its customer orders. For example, if an electronics store underestimates demand for a new laptop computer, it will lose customers to a store that has secured adequate stock. See also safety stock.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

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