Stockout Contribution Exposure Calculator

How the stockout contribution exposure calculator works

Demand during the event is average daily demand times stockout days. Multiply by one minus recovered percentage to estimate permanently lost units. Expected quantities can be fractional because demand and recovery are assumptions.

Revenue exposure is lost units times unit price. Contribution exposure subtracts variable costs avoided on those lost units. Add the entered mitigation cost once for total modeled contribution exposure. Unit price must be at least variable cost so the result describes positive or zero contribution at risk.

Recovered demand is assumed fulfilled later without changed price or cost. This is not a forecast of lost sales, customer churn or brand damage. It excludes the timing value of delayed receipts, lifetime effects, inventory write-offs and costs not entered.

Worked example

Demand of 40 units per day over three stockout days exposes 120 units. If 25% is fulfilled later, 90 units remain lost. At $50 revenue and $30 avoided variable cost each, revenue exposure is $4,500 and contribution exposure is $1,800. Adding $200 mitigation cost gives $2,000 total modeled exposure.

Sources and assumptions

The source material explains the underlying calculation or pricing structure. Entered prices, costs, schedules and scenario choices are your assumptions; this tool does not obtain supplier quotes or predict actual results.

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