Stockouts kill rankings: simple demand forecasting in a spreadsheet

Mariana Lopes · 2026-10-07

To avoid stockouts on marketplaces, it’s essential to implement effective demand forecasting. Here are the key points you should consider:

Sales velocity

Sales velocity is the number of products sold over a given period. To calculate it, use this formula:

Sales Velocity = Total Sales During the Period / Number of Days

Example: If you sold 300 units in 30 days, your sales velocity is 10 units/day. This helps you understand how much inventory you should keep on hand to meet demand.

Lead time

Lead time is how long it takes to restock, from placing an order with your supplier to the products arriving at your store. To calculate it:

1. Identify every step in the purchasing and shipping process.
2. Add up the time for each step (e.g., production, shipping, receiving).

If your average lead time is 15 days, you need to factor that in when planning inventory.

Reorder point

The reorder point is the inventory level at which you should place a new order to avoid a stockout. To calculate it, use this formula:

Reorder Point = (Sales Velocity x Lead Time) + Safety Stock

If your sales velocity is 10 units/day and your lead time is 15 days, your reorder point will be 150 units, plus safety stock.

Safety stock

Safety stock is the extra amount of product you keep on hand to cover demand fluctuations or supply delays. To calculate it:

1. Review historical sales fluctuations.
2. Set an additional percentage to cover those fluctuations (e.g., 20%).

If your average sales are 10 units/day and you have a variation of 2 units, your safety stock would be 40 units (20% of 200 units in a month).

Alerts

Set up alerts to monitor your inventory levels. You can do this in Excel or Google Sheets:

1. Create a column for your current inventory level.
2. Add a column for the reorder point.
3. Use conditional formatting to highlight when inventory falls below the reorder point.

This gives you enough time to restock before a stockout happens.

By implementing these five points, you can improve your demand forecasting and minimize the risk of stockouts, helping ensure your marketplace rankings aren’t negatively affected.

What are your sales velocity and lead time numbers?