Why Brands Struggle With Stockouts: The Most Overlooked Cause (and How to Prevent It)

The Most Overlooked Reason New Brands Struggle with Out-of-stock Items

Here’s the truth most early-stage retail and DTC brands don’t realize:
Most stockouts happen because brands are not forecasting sales at the item level.

Yes — out-of-stocks can be a “good problem” because it means customers love your product. But the downside is significant:

• You're disappointing customers and weakening retention.

• You're missing easy revenue due to preventable stockouts.

• Your cash flow is tied up in unproductive inventory while your best sellers run dry.

This is one of the most common (and costly) inventory management challenges small and scaling brands face — and it’s almost always tied to inadequate demand planning and lack of item-level sales forecasting.

The only way to avoid this cycle?
Implement item-level demand forecasting and update it regularly as you gain more sales data. 

Planning Sales Top-Down vs. Bottom-Up

Many new brands rely on a high-level, top-down forecasting approach. They may reorder based on overall sales trends or average weekly sales without digging deeper into item-level performance, seasonality, or changing demand signals.

This approach creates major blind spots.

Why it’s a problem:

• Some items sell seasonally and need higher inventory leading into peak periods.

• Other items have steady weekly demand and require a different reorder cadence.

• Averages hide variation — and variation is exactly what drives stockouts and overstocks.

Without bottom-up forecasting (built SKU by SKU), you can easily end up with:

• Item-level stockouts that limit sales

• Excess inventory on slower-moving SKUs

• Cash flow constraints that stop you from reordering best sellers

A bottoms-up forecast allows you to roll up individual SKU projections into a more accurate total sales forecast, giving you better visibility into demand trends and improving both your inventory forecast and your merchandise planning strategy.

Do I Really need to Get THIS Detailed in My Sales Forecast?

If you’re running a young business with limited historical data, item-level forecasting may feel overwhelming. But robust inventory planning doesn’t have to be complicated.

In fact, the earlier you implement SKU-level forecasting, the easier it is to:

• Make smarter, data-backed reorder decisions

• Avoid unnecessary out-of-stock periods

• Prevent cash-draining excess inventory

• Support your sales growth with confidence

• Improve forecast accuracy over time

Even without years of data, structured item-level forecasting helps you build the foundation for strong demand planning and inventory optimization as your assortment and sales volume grow.

A Faster Way to Start: Our Inventory Planning Starter Kit

If you haven't yet created an inventory review process or your to-do list is endless, one of the simplest time-saving ways to start forecasting accurately is with the Reorder Calculator inside our Inventory Planning Starter Kit.

This toolkit was built using the same methodologies our planners use with fast-growing retail and DTC brands.

With the Reorder Calculator, you can:

• Input all SKUs one time

• Pull your Shopify sales history

• Automatically view item-level demand trends

• Generate a forward-looking demand plan

• See recommended reorder quantities by SKU

• Account for vendor lead times and MOQs

• Get automatic alerts for projected stockout dates

These insights help you make data-driven decisions when:

• Planning reorders

• Managing promotions

• Forecasting cash needs

• Preventing out-of-stock periods

This is exactly the kind of inventory planning structure early-stage brands need long before investing in advanced forecasting software.

And yes — Harvard Business Review confirms that communicating forecasted stockouts improves customer trust and retention, so these alerts help you do that too.

Boon Provides Customized Demand Planning Solutions

The Reorder Tool (plus the initial buy tool, inventory dashboard, PO tracker, and cash flow tool included in the full Starter Kit) is a perfect starting point for brands new to inventory forecasting and demand planning.

But if your assortment is larger, more complex, or growing quickly, our team at Boon can help you level up.

We build customized demand plans, SKU-level forecasting models, and inventory management systems for brands across apparel, beauty, CPG, accessories, and more — all designed to help founders avoid stockouts, optimize cash flow, and plan with confidence.

This is what we do every day. We’d love to show you how we could support your retail or DTC brand.

👉 Avoid stockouts. Prevent excess inventory. Improve forecast accuracy.

Book a free 30-minute consultation to learn how our demand planning experts can help your business grow sustainably.