COSTS & CONVERSION

Stockout Cost & Lost Contribution Calculator

Model the contribution lost from unfilled demand, with an explicit lost-sales assumption and separately entered recovery costs.

Stockout cost calculator

Model the contribution lost from unfilled demand, with an explicit lost-sales assumption and separately entered recovery costs.

How it works

Adjust the example values to match your scenario.

YOUR RESULT LIVE CALCULATION
Estimated stockout impact
$2,120/ incident
SCENARIO, NOT A FORECAST
Lost contributionAdditional costs
Assumed permanently lost units
90
Assumed deferred/recovered units
30
Lost contribution
$1,620
Additional incident costs
$500

Unfilled demand is not automatically lost sales. Only the entered lost-sales share contributes to lost margin.

BEHIND THE NUMBER

How the calculation works

Contribution per unit is the selling price less the variable costs avoided when that sale is not made. Enter the share of unmet demand you expect to lose permanently; the rest is treated as deferred or recovered and has no lost contribution in this simplified model. Additional costs can include incremental expediting, penalties, or other incident costs not already counted. Fractional lost units represent a scenario expectation, not an observed count.

Lost units = unfilled demand × lost-sales share / 100; impact = lost units × unit contribution + additional incident costs

When this calculation helps

Separate demand permanently lost from demand deferred into a later period. The contribution on a lost unit excludes variable costs avoided when that sale is not made.

Check the interpretation

Adding full lost revenue to lost contribution counts the same economic effect twice. Record expediting and penalties separately and avoid repeating them in another field. The lost-sales share is your scenario assumption, not a forecast of customer behavior.

This is an entered-assumption scenario, not a prediction of customer behavior. It excludes unentered downtime, future customer loss, and deferred-order margin changes. Do not add full lost revenue on top of lost contribution or double-count recovery costs.

Good to know

Why use contribution instead of sales revenue?

A lost sale can also avoid variable costs. Using contribution separates the lost economic contribution from gross revenue and avoids treating avoided costs as losses.

What happens to backorders?

The portion not marked permanently lost is treated as deferred or recovered without lost contribution. Add only separately identified incremental costs to the additional-cost field. Actual recovery rates must come from your own evidence.