Which statement best describes "stockouts"?

The statement that best describes "stockouts" is when there is no product available for sale. This situation occurs when demand for a product exceeds the available supply, resulting in unfulfilled orders and potentially lost sales. Stockouts can have negative impacts on customer satisfaction and can harm the reputation of an organization. Efficient inventory management aims to minimize stockouts while ensuring that product availability meets customer needs.

In contrast, optimal inventory levels refer to maintaining sufficient stock without excess, which is not descriptive of stockouts. Excess inventory implies having more stock than needed, and overordering describes a practice that can lead to excess inventory, which is opposite to stockouts. Understanding the dynamics of stock management, including the risks and impacts of stockouts, is crucial in supply chain management.