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stockout costs

Stockout costs

1) The economic consequences of an internal or external stockout such as missed sales, delayed deliveries, anticipated lower sales in the future because of loss of goodwill, costs resulting from production stoppages and all kinds of associated costs. (Source: ILT Supply-Chain Inventory Management SIG)

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Shortage (or Stockout) costs

1) The economic consequences of an external or internal inability to meet a demand from stock. External impacts can include backorder costs, present profit loss from lost sales and future profit loss from loss of goodwill and reputation.

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