Scarcity risk

What is scarcity risk?

Scarcity risk is a product at risk of selling out at its current rate of demand. It is identified by combining two things that are only meaningful together: how much stock is left, and how fast it is moving. Low stock alone is not scarcity risk — a product with a handful of units and no recent activity is simply a tail product. Low stock with live, active demand is the risk.

How is scarcity risk identified?

Flockr combines a product’s current inventory with its recent demand — views, add-to-bags, purchases, active carts — and its short-term demand trend. A product is flagged when stock is low and the demand against it is strong enough that it is likely to run out before the next replenishment.

Why does the demand half matter as much as the stock half?

Because stock level on its own is misleading. The most actionable case is a short stock runway paired with accelerating demand — those are the products to restock first. A short runway with fading demand may resolve itself; the demand drop will likely outlast the inventory drop, so it is a lower priority despite the low stock.

How is scarcity risk different from stock runway and risk score?

Stock runway is the underlying time measure — days of stock left at the current rate. Scarcity risk is the condition — low stock meeting live demand. Risk score is the ranking that orders scarcity-risk products by urgency. Runway is an input; scarcity risk is the flag; risk score decides what to act on first.