What Is Stockout?

When Missing Parts Stop Everything

Missing parts create a cascade that disrupts entire operations, turning routine maintenance into emergency firefighting while costs multiply and schedules collapse.

The call comes at 2 AM. A critical pump bearing has failed on Line 3, bringing production to a halt. The technician knows exactly what's needed, and it's a standard bearing that should be sitting in Bin 4-C-12. But when they scan the QR code, the storeroom system shows zero on hand. The backup location is empty too. 

Now a 30-minute repair becomes a multi-hour crisis of phone calls, emergency sourcing, and expedited shipping that won't arrive until tomorrow afternoon. By morning, the maintenance manager is explaining to operations why a $200 bearing is causing $150,000 per hour in lost production.

This scenario plays out across industrial facilities every day. While retail stockouts mean lost sales, maintenance stockouts trigger something far worse: cascading operational failures. 

A missing seal kit doesn't just delay a repair. It pushes preventive maintenance off schedule, forces technicians to leave equipment partially disassembled, creates safety risks from temporary workarounds, and destroys the carefully orchestrated dance between maintenance windows and production demands. 

Unlike consumer inventory, where substitutes exist and customers can wait, industrial components often have exact specifications with lead times measured in weeks or months.

The impact compounds across the organization. 

• Planners lose credibility when scheduled work can't start. 
• Technicians waste hours hunting for alternatives or cannibalizing idle equipment.
• Purchasing scrambles to find suppliers who can deliver yesterday. 
• Leaders watch as maintenance budgets explode due to expediting fees, while reliability metrics crater. 

What started as an inventory problem becomes an organizational trust problem.

Yet many maintenance teams still manage parts inventory the same way they did decades ago, with static min/max levels, periodic manual counts, and spreadsheets that never quite match reality. The disconnect between what modern maintenance demands and what traditional inventory provides has never been wider. 

This is why advanced CMMS platforms like Tractian are embedding AI-powered intelligence directly into parts management, transforming inventory from a reactive scramble to a predictive advantage. The journey from stockout crisis to inventory control is about knowing precisely what you need, when you'll need it, and ensuring it's there before the work begins.

Glossary snapshot

• Stockout: Zero usable inventory when maintenance work requires the part
• MRO: Maintenance, Repair, and Operations inventory is distinct from production materials
• Lead time: Days between order placement and receipt, often weeks for industrial components
• Safety stock: Buffer inventory that absorbs demand variability and supplier delays
• Min/max: Inventory thresholds that trigger reordering when stock hits minimum or caps at maximum
• Fill rate: Percentage of work orders completed without parts delays

What Is Stockout in Industrial Maintenance?

A stockout occurs when there is zero inventory, despite demand being present. However, in maintenance, it specifically refers to the distinction between controlled work and emergency scrambles. Or, as many refer to the difference between them, planned responses and unplanned firefighting. 

The technical definition

At its core, a stockout occurs when inventory reaches zero while active demand exists. But the maintenance context adds critical nuance. A backorder means you've placed an order that will arrive on a known date, allowing some level of planning. A stockout means you have nothing and might not even have a supplier identified. 

For MRO inventory, this distinction drives fundamentally different responses. When finished goods stock out, sales might shift to the next quarter. When maintenance parts stock out, equipment stays broken.

And, stockouts aren't just consumables like filters and belts. They include critical engineered components with specifications so precise that no substitute exists. Unlike retail, where one brand might replace another, a pump seal with specific pressure ratings, material compatibility, and dimensional tolerances has no alternative.

Why maintenance stockouts hit different

Maintenance stockouts create immediate operational consequences that ripple through the entire facility. When a bearing is unavailable, the equipment remains down. Period. There's no partial solution, no customer who can choose a different product, and no shifting demand to next week. The machine either runs or it doesn't. 

From here, the cascade begins immediately. That bearing failure doesn't just affect today's repair. 

• The technician assigned to the job can't move to their next task. 
• The PM scheduled for the same equipment next week may need to be rescheduled since the machine isn't running. 
• Other equipment in the production line experiences stress from stopping and starting. 
• Quality issues emerge from rushed restarts. 
• Safety risks multiply when teams attempt creative workarounds. 
• Compliance documentation falls behind when standard procedures can't be followed.

Each disruption multiplies the original problem. A maintenance team operating on a two-week sprint suddenly finds its entire schedule questionable. Which jobs can actually start? Which PMs should be deferred? How do we redistribute technician assignments? The planning that took hours to optimize is now unraveled in minutes.

The real cost equation

The financial impact extends far beyond the price difference between standard and expedited shipping. According to NIST research, "Maintenance can affect product quality, capital costs, labor costs, and even inventory costs, amounting to efficiency losses to both producer and consumer." These efficiency losses compound in ways that traditional accounting often misses.

Direct costs hit immediately and obviously. 

• Expedited shipping typically costs five to ten times the standard rate. 
• Overnight delivery for a single component can exceed its purchase price. 
• Overtime labor accumulates while technicians wait for parts or work extended hours once parts arrive. 
• Emergency vendor premiums apply when you need something yesterday.
• Production losses mount by the hour, often reaching six figures per day for critical equipment.

The hidden costs prove equally damaging over time. Administrative burden increases as purchasing chases suppliers, maintenance recoordinates schedules, and management explains delays. Team morale erodes when technicians are unable to complete their work properly. 

The maintenance department's credibility suffers when promised completion times are missed, while customer relationships are strained by delayed deliveries. Additionally, contract penalties are triggered when service level agreements are breached. 

Many businesses fail to fully account for these impacts, which explains why stockouts persist despite their substantial true cost.

The Root Causes Behind Chronic Stockouts

Understanding why stockouts persist despite best efforts reveals systemic gaps between planning ideals and reality on the floor.

Demand unpredictability

Industrial equipment refuses to fail on schedule. A bearing rated for 10,000 hours might last 15,000 under perfect conditions, yet the same component could fail at 5,000 under unexpected load, making traditional forecasting nearly useless. 

As equipment ages, it develops unique failure patterns that no manual can predict. Seasonal stress exacerbates this chaos, with summer heat straining cooling systems while winter temperatures render seals brittle and lubricants thick. The same part that lasts all year in controlled conditions might fail monthly when exposed to these extremes.

Additionally, production surges create their own form of unpredictability. When orders spike, equipment runs longer shifts at higher speeds, and preventive maintenance often gets deferred to maximize uptime. Components designed for single-shift operation suddenly face round-the-clock stress, which can double or even triple consumption rates. Yet, inventory systems continue to calculate based on historical averages, meaning that by the time the system catches up to reality, stockouts have already occurred.

Supply chain complexity

Lead times stretch from weeks to months, with custom parts requiring multiple stages of forging, machining, heat treatment, and testing. Making matters worse, vendor consolidation has eliminated alternatives for many components. 

Where maintenance teams once had three or four reliable suppliers, mergers and acquisitions often leave them dependent on a single source. When that sole supplier faces production issues or simply prioritizes larger customers, stockouts become inevitable.

Obsolescence is another area of significant concern. This is when a manufacturer discontinues a product line, an environmental regulation bans a critical material, or a specialized supplier declares bankruptcy. Parts that were readily available yesterday suddenly require reverse engineering or custom fabrication tomorrow. 

Maintenance teams typically discover these changes only when attempting to reorder, which transforms routine procurement into a crisis management situation.

Internal disconnects

Even with predictable demand and reliable suppliers, internal process gaps can still trigger stockouts.

The most fundamental disconnect often lies in system accuracy itself. Maintenance teams frequently encounter situations where critical parts are missing, or the system shows items in stock that are not actually available.

The issue is compounded by Bill of Materials drift, which occurs when engineering modifies equipment without updating maintenance records, or when purchasing sources equivalent parts without documenting the change. Over time, these gaps cause a complete divergence between what the system says equipment needs and what it truly requires.

Multi-site operations add another layer of complexity. Each facility typically manages its own storeroom with unique practices, resulting in situations where Site A has a surplus of bearings while Site B suffers a stockout of the identical part. Meanwhile, manual processes introduce dangerous delays throughout the system. 

Technicians use parts but don't update counts until the end of their shift. Receiving departments log deliveries on paper, which won't be entered until the next day. Purchasing teams batch requisitions weekly for efficiency. Each of these delays creates a blind spot where stockouts can develop unnoticed. 

By the time the system finally reflects reality, that reality has already changed again.

Pain Points: How Teams Experience Stockout

The daily frustration of stockouts is a unifying pain for every role in industrial maintenance, from technicians and storeroom staff to planners and managers. While each team faces unique challenges, the result is always the same. You lose time, waste money, and experience a steady erosion of trust in both systems and schedules.

On the floor: For technicians, stockouts are a persistent source of disruption that often appears mid-job, when the clock is already ticking. As one frontline professional put it, “Critical parts not being in stock, or the computer saying something is in stock when it isn’t.” When a kit is missing a single fitting, a job that should wrap up in minutes stretches into hours of searching, phone calls, and sometimes risky improvisation. 

The impact extends beyond complex assemblies. “I can't even get basic shit like air hose fittings,” another technician shared. Work orders stall, shifts are reshuffled, and time that should be spent maintaining equipment is burned just chasing parts.

In the storeroom: Storeroom staff operate in a constant tension between digital inventory counts and the reality on the shelf. Discrepancies can creep in from delayed postings, rushed cycle counts, or parts set aside for other projects. Space is always at a premium, with some teams forced to store overflow inventory in hallways or makeshift bins, compounding errors and search times. Reservation conflicts and double-bookings create confusion, where two work orders might “own” the same part in the system, leaving both crews empty-handed when the time comes.

At the management level: For planners and maintenance managers, every stockout is a missed promise and a direct hit to key metrics. As one frustrated manager summarized, “2 days down is only, what, $3.5 million in revenue? There’s no reason to waste $5,000 on a part that we regularly replace once a month.” But the reality is that missed repairs, rising Mean Time To Repair (MTTR), and blown budgets all have cascading effects. The schedule built to optimize labor and asset uptime quickly unravels as teams scramble for alternatives, and confidence in future plans drops with every unresolved shortage.

Every department experiences the pain differently, but the organizational cost continues to compound. Stockouts undermine credibility, stretch maintenance intervals, and put everyone on the back foot, turning routine work into a series of costly fire drills.

How Maintenance Teams Cope Today

Every maintenance department develops its own set of tactics to mitigate the fallout from stockouts, combining long-standing inventory principles with workarounds born out of necessity. These coping mechanisms range from sensible to risky, and while they often keep the lights on, they’re just as likely to introduce new problems beneath the surface.

Traditional approachesMost teams start with the basics, setting min/max inventory levels based on historical averages, buffering with safety stock, and classifying parts by importance or consumption rate using ABC analysis. 

Manual cycle counts are a routine part of the process, designed to catch errors before they snowball into critical shortages. But static settings quickly fall out of step with real-world changes, especially as equipment ages or production schedules shift.

The workaround realityWhen standard methods fall short, creativity and desperation take over. Technicians and planners develop private stashes of critical parts, pulling from personal or unofficial inventories when the system says zero. Cannibalizing idle equipment becomes standard practice in a pinch, sacrificing non-essential assets to keep priority lines running. 

Emergency procurement cards are used to fast-track last-minute purchases when regular processes can’t keep up. The risks of these strategies show up in unexpected ways. A technician described substituting a belt by saying, "So you put a B29 belt instead of a B28 and hope for the best.” Others quietly build backup inventories just to survive the next surprise.

System limitationsMany teams are still held back by tools that can’t keep up with today’s maintenance demands. As one professional put it, teams rely on “spreadsheets or inflexible ERP systems that struggle to adapt to changes in demand, supplier setbacks, or seasonal fluctuations.” There’s often a lag between when parts are used and when the system is updated, meaning shortages remain hidden until it’s too late. 

Most inventory systems have little to no connection to actual work order planning, leaving maintenance to discover missing parts only after the work is supposed to begin.

Each of these strategies and system gaps represents a short-term fix that can’t scale with operational complexity. As plants and teams grow, the workarounds that once kept things running become new sources of risk, making true inventory control feel out of reach.

The Technology Shift: From Reactive to Predictive

The right technology turns inventory from a high-stakes guessing game into a proactive, data-driven discipline. Instead of scrambling after shortages appear, maintenance teams can anticipate needs, catch errors early, and optimize every part of the process. This shift is already transforming how leading plants manage risk, control costs, and protect uptime.

Real-time visibility

• Mobile updates at point of use: Technicians can log part consumption directly from the job site, ensuring inventory data is always current.
• Barcode and RFID tracking: Scanning technology bridges the gap between what the system displays and what is actually on the shelf, eliminating confusion and double-counting.
• Live consumption tied to work orders: Every issued part is immediately linked to a specific job, providing clear audit trails and more accurate forecasting.
• Tractian’s role: Solutions like Tractian deliver real-time visibility, allowing maintenance teams to see what’s available, what’s reserved, and what’s at risk before it becomes a problem.

Predictive intelligence

• Risk estimation: Research indicates that accurately estimating the probability of stockouts for repairable spare parts in manufacturing maintenance enables teams to target their most critical risks [6].
• Pattern recognition in failure data: Systems can spot spikes or trends in equipment failures, automatically adjusting demand forecasts and reorder triggers.
• Dynamic reorder points: Inventory policies can now respond in real time to shifts in demand, lead time, or usage, instead of relying on outdated static settings.
• Seasonal adjustment algorithms: Predictive analytics help account for demand surges, from annual shutdowns to seasonal workloads, keeping inventory levels responsive and right-sized.

Integration advantages

• CMMS and ERP data flow: Integrating Computerized Maintenance Management System (CMMS) platforms with Enterprise Resource Planning (ERP) systems removes silos and reduces the risk of mismatched or outdated data.
• Automated reservation checks: The system can instantly confirm that all required parts are available before work orders are released, preventing false starts and on-the-fly rework.
• Parts-to-PM validation: Inventory can be directly mapped to Preventive Maintenance (PM) tasks, ensuring that nothing is overlooked or forgotten.
• Supplier performance tracking: Data-driven insights reveal which vendors consistently deliver on time, making it easier to adjust procurement strategies and protect against supply chain shocks.

Moving from reactive fixes to predictive management requires more than just new tools. It demands a culture that values accurate data, clear processes, and continuous improvement. Unsurprisingly, the payoff is measured in fewer emergencies, higher equipment uptime, and restored trust across the operation.

How Tractian Prevents Stockouts Before They Happen

Tractian bridges the gap between maintenance planning and inventory control, turning inventory management from a reactive scramble into a disciplined, predictive process. By surfacing risk before it can disrupt work, Tractian enables maintenance teams to keep operations moving without the daily threat of stockouts.

Unified execution

Everything starts with a unified execution platform built around real-world maintenance workflows. Work orders are parts-aware from the very beginning. The system automatically checks inventory as each job is planned, flagging potential shortages or reservation conflicts before a technician even arrives at the job site. 

At the point of work

When work begins, technicians log consumption right at the point of use with mobile devices, and inventory records update in real time. Even if Wi-Fi drops out in the plant or storeroom, Tractian’s offline reliability ensures that every transaction is captured and synced once connectivity returns.

AI-powered tracking

At the intelligence layer, Tractian brings clarity to usage and risk that static systems can’t match. The platform tracks consumption trends over time, analyzing which parts move fast, where unexpected spikes occur, and how usage links to failure histories or PM schedules. Dynamic min/max levels are tuned by live data, adapting to real-world changes instead of relying on outdated averages. 

Multi-site visibility

Multi-site visibility brings all inventory into one dashboard, making it easy to balance stock, transfer parts between locations, and avoid redundant purchases that tie up capital.

Implementation without downtime

Equally important, Tractian’s implementation doesn’t drag on for months. Instead, deployment is measured in weeks, not quarters, and is backed by proven outcomes in the field. Maintenance teams see measurable reductions in stockouts and downtime, higher completion rates on scheduled work, and a dramatic drop in emergency procurement. 

With Tractian, the maintenance department finally gains the control and confidence it needs to make out-of-stock situations a rare exception instead of a persistent threat.

Formula Notes on Stockout Metrics

A disciplined approach to inventory management requires maintenance teams to have explicit formulas and KPIs to forecast needs, set buffers, and track how well inventory is supporting uptime goals.

At the core is the Reorder Point (ROP), the minimum stock level that triggers a replenishment order. The standard formula is:

Reorder Point = (Average daily usage × Lead time in days) + Safety stock

• Average daily usage is calculated from historical consumption data, not rough estimates.
• Lead time refers to the actual number of days between placing an order and receiving the part, which can vary significantly depending on the supplier and part type.
• Safety stock acts as a cushion for unexpected demand spikes or delivery delays, protecting against stockouts when reality doesn’t follow the plan.

Safety stock itself can be estimated with a basic calculation:

Safety Stock = (Maximum daily usage × Maximum lead time) − (Average daily usage × Average lead time)

These formulas drive the real-world thresholds that determine whether maintenance work starts on time or gets delayed due to a missing part. Tractian’s analytics layer automates these calculations, continuously adjusting for actual usage patterns, changing lead times, and emerging risks.

Maintenance teams can also monitor the fill rate, which is the percentage of work orders completed without a parts delay, as a direct measure of inventory effectiveness. When the fill rate dips, it’s a signal that stockout risk is creeping back in, and that it’s time to tune the numbers behind your inventory plan.

A Blueprint for Implementing Stockout Prevention

Building a resilient inventory program is not a matter of flipping a switch. The transition from reactive firefighting to predictive control happens in phases, each one laying the groundwork for the next. 

The goal is to deliver quick, visible wins that build trust across the team while steadily advancing toward a fully integrated, data-driven process.

Phase 1: Baseline and PrioritizeThe journey begins by establishing a clear picture of what matters most. This is where teams identify their most critical spares and the parts that would bring operations to a standstill if they were missing. 

It’s also the moment to clean up master data, ensuring part numbers, descriptions, and locations are accurate. Finally, service level targets are set so everyone knows what success looks like.

• Identify critical spares: Focus on components that drive the highest risk if unavailable, often identified through past breakdowns and maintenance records.
• Clean master data: Review and correct inventory records, standardize naming, and eliminate duplicates to prevent confusion and missed reorders.
• Establish service level targets: Define what percentage of work orders should be completed without parts delays, setting a baseline for ongoing improvement.

Phase 2: Connect SystemsWith priorities set, the next step is to ensure information flows seamlessly. This phase involves breaking down silos so that every piece of data is in sync, from the shop floor to the storeroom.

• Link BOMs to equipment: Ensure every piece of equipment has a detailed Bill of Materials (BOM) tied directly to its maintenance plan, reducing surprises during repairs.
• Integrate CMMS and inventory: Connect the Computerized Maintenance Management System (CMMS) with inventory systems so planning, scheduling, and parts management speak the same language.
• Deploy mobile tools: Equip technicians and storeroom staff with mobile devices for real-time updates, accurate counts, and faster problem resolution.

Phase 3: Activate IntelligenceThis is where predictive capability comes online. Teams begin tracking real consumption, enabling dynamic inventory policies that adapt to real-world changes.

• Enable consumption tracking: Monitor how and when parts are used in real time, feeding data directly into inventory optimization.
• Set dynamic reorder points: Use live data to adjust reorder points and safety stock levels, responding quickly to shifts in demand or lead times.
• Monitor exception alerts: Set up automated notifications for potential shortages, delayed deliveries, or usage anomalies so action can be taken before issues escalate.

Phase 4: Scale and OptimizeOnce the foundation is solid, it’s time to extend predictive control across the entire operation. This phase is about continuous improvement, ensuring the system keeps pace with evolving business needs.

• Expand to all categories: Move beyond critical spares to cover all inventory types, from consumables to specialty components.
• Refine prediction models: Regularly review and update forecasting algorithms based on new data and lessons learned.
• Build supplier partnerships: Collaborate with vendors for more reliable deliveries, transparent lead times, and mutually beneficial inventory strategies.

With each phase, maintenance teams move closer to eliminating the surprise and chaos of stockouts, creating a more stable and predictable environment for both equipment and people.

Ready to Make Stockouts Rare?

The shift from being caught off guard by missing parts to confidently controlling inventory marks a turning point for any maintenance operation. With the right strategy and technology, teams move from scrambling in crisis to delivering consistent uptime, cost savings, and renewed trust across production. 

The journey begins by addressing the real pain points, followed by a clear blueprint that connects people, processes, and data into a unified, predictive approach.

AI-Powered Computerized Maintenance Management Systems (CMMS) make this transformation possible, bringing inventory and maintenance together in a way that turns every work order into an opportunity for control, not chaos. 

Tractian’s execution-first platform empowers teams to anticipate needs, eliminate fire drills, and keep the focus on reliability and results, where it belongs.

Request a demo to see how Tractian can help you make stockouts the rare exception in your facility.

FAQ

What’s the difference between a stockout and a backorder?

A stockout occurs when there is zero inventory available to fulfill a current maintenance need, forcing work to stop or be rescheduled. A backorder means an order has been placed for out-of-stock parts, with a future delivery date known, allowing for some level of planning but not immediate resolution.

How do you calculate the true cost of a stockout?

The actual cost of a stockout goes well beyond the price of the missing part. It includes overtime labor, expedited shipping fees, lost production value, emergency vendor premiums, and potential penalties for delayed delivery. These costs add up quickly and often exceed the direct replacement cost by a wide margin.

What’s the optimal safety stock level?

The optimal safety stock is determined by balancing the risk of a stockout against the cost of holding excess inventory. The calculation considers average and maximum usage rates, lead time variability, and desired service level. Commonly, teams use the Safety Stock formula.

How does Tractian detect stockout risks before they happen?

Tractian’s platform monitors inventory in real time, automatically checking availability as work orders are scheduled. It uses predictive analytics to flag shortages, analyze usage trends, and send alerts when parts are at risk of falling below critical thresholds. This early warning allows teams to act before disruptions occur.

Can Tractian handle multi-site inventory visibility?

Yes, Tractian’s unified platform provides centralized dashboards that show inventory status across all sites and storerooms. Regardless of industry, whether food and beverage, mining, mills & agriculture, or automotive manufacturing, this makes it easy to identify surplus or shortages, transfer stock as needed, and coordinate procurement for maximum efficiency.

How quickly can teams see stockout reduction after implementing Tractian?

Most teams begin to see measurable improvements within weeks of deploying Tractian. The fast implementation timeline means better inventory visibility, reduced emergency orders, and higher work order completion rates soon after go-live, with further gains as processes and predictive models mature.