Removing Stock-Outs from your Forecasting in SoStocked

Overview

A stock-out is an unusual period of time where your daily sales velocity is negatively impacted as you run out of inventory. If you do not remove these periods from your forecasting, then you might not order enough inventory, resulting in more stock-outs and lost sales!

If stocking out is something that you'd like to eliminate at all costs, this article will help you achieve that goal.

Using SoStocked To Eliminate Stock-Outs From Your Forecast

Starting on your Forecast page, click on the specific product of your choice. In this example, you have the stainless shaker as your product. Click on the product to open up some of the forecast options.

The first thing you're going to see is a sales graph, where you can find the stock-out periods for the product.

What SoStocked does is take the past sales data and predict the product's future sales as accurately as possible. It's taking the velocity for your chosen period of time and use that to predict future sales.

Stock Outs Tool in SoStocked

One of the tools available in SoStocked is the Stock Outs tool

It's looking over the last 365 days to find any day where your inventory either went to zero or partially stocked out if you have a high selling product (a product that sells 10 or more units per day on average).

A partial stock-out is considered any time when your sales dropped by 70%, leaving you 30% or less of your average daily sales on any product selling 10 units or more per day. If you have a product that sells less than ten units per day on average, partial stock-outs will not be calculated, and SoStocked is only looking at days when your inventory actually went to zero.

The reason partial stock-outs are included on high-selling products is that sometimes you might stock out, and Amazon might find a few units in a warehouse somewhere that still made you sell a couple of units. And if we calculated that back into your forecast, that one day of partial stock-out would throw off your entire forecast.

In this specific example, by clicking into the velocity and with the stock-outs feature turned on, SoStocked will be looking over 365 days of last year's sales, and any stock-out day will be marked with an asterisk.

If the stock-out tool is off, it'll show up as a zero sales day.

Essentially, what SoStocked is doing is taking the average of the 30 days or so surrounding that stock-out and figuring out what you would have sold if you were in stock.

If you save this forecast of last year's sales, you can see that there are no green boxes checked on the past daily sales velocity, and it just says last year's sales.

SoStocked is going to mimic the exact sales pattern from last year on this year's sales forecast. And since you have the stock-out tool turned on, there will be no zero sales day in your forecast.

If you turn off the Stock Out tool, you have stock-outs showing up in your forecast because stock-outs happened last year.

Overall, the Stock Out tool of SoStocked is essential to eliminate previous stock-outs from calculating your sales forecast.

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