An Analysis of Lost Sales

The purpose of this manuscript is to shed light on problems associated with lost sales and the incurring of cost associated with lost sales. An investigation is made to determine if seasonality in sales and lost sales have effects on the efficient operations of supply chains. Optimization is alays a goal of management supply chains but cost increases due to insufficient inventory, low quality product and the like lead to customers not returning. These are lost sales which occur for many reasons. We study a data set to determine if the ignoring of time series component also have an effect on the variation in lost sales. If so, can we measure the magnitude of the effects of seasonal variation in lost sales and what are their consequences.