Inventory glossary

What is Out of stock rate?

Out of stock rate is the share of time or the share of SKUs that have zero available inventory over a given period.

For a small Shopify store, a high out of stock rate means lost sales and customers who leave to buy from someone else. Tracking it by SKU shows which products keep running dry and need earlier reordering or more safety stock, rather than treating stockouts as random bad luck.

Use it to review your catalog monthly. If a handful of SKUs cause most of your stockouts, fix their reorder points or lead times first instead of spreading effort evenly across every product.

Formula

Out of stock rate = Number of SKUs out of stock / Total number of SKUs x 100

Example

A candle store carries 40 SKUs. On a given day, 6 of them show zero stock available for sale. Out of stock rate = 6 / 40 x 100 = 15 percent. If this stays above 10 percent for several weeks in a row, the store owner knows reorder points are set too low for several products.

Common mistakes

  • Counting a SKU as out of stock only when it hits zero, ignoring the days it sat at 1 or 2 units with no real availability to sell.
  • Measuring only on random spot checks instead of tracking daily, which hides short but frequent stockouts.
  • Mixing discontinued or hidden SKUs into the total count, which distorts the rate and hides real problems with active products.

Out of stock rate and SteadyShelf

SteadyShelf calculates order-by dates per SKU from supplier lead times, which helps a store reorder before hitting zero stock and keep its out of stock rate low.

SteadyShelf is launching on the Shopify App Store. Join early access to get the install link first.

Related terms

Stockout · In-stock rate · Service level · Reorder point · Lost sales

Full inventory glossary

FAQ

Is out of stock rate the same as stockout rate?

Yes, the two terms are used interchangeably. Both measure the share of SKUs or time with zero available stock.

What is a reasonable out of stock rate for a small Shopify store?

There is no universal target. A reasonable goal is to keep core, fast-selling products near zero stockouts while accepting some gaps on slow-moving or long tail SKUs.

Let SteadyShelf do this math for every SKU

Order-by dates per supplier, seasonal forecasts and draft POs for your Shopify store. $29/month after a 30-day free trial.

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