Fill rate is the share of customer demand a brand fulfills from on-hand inventory in a defined period, without backorder, substitution, or cancellation. The canonical formula is units shipped divided by units ordered over a window — day, week, or month — with the numerator excluding any backordered, substituted, or canceled line.
The denominator is where practitioners disagree, and the choice changes the story. Three conventions are common: unit fill rate (units shipped / units ordered), line fill rate (lines shipped complete / lines ordered), and order fill rate (orders shipped complete / orders placed).
A small example makes the gap visible. A five-unit cart with one SKU out of stock ships four units — 80% unit fill, but 0% order fill, since one missing line fails the order. Aggregated, this is how a brand lands at 95% unit fill while order fill sits in the seventies: units available, carts incomplete.
Fill rate is the demand-side mirror of stockout rate: stockout rate measures how often inventory hits zero; fill rate measures how much demand shipped.
In DTC, unfilled demand usually cancels rather than queues — a shopper hitting an out-of-stock substitutes or leaves — so fill rate is lost revenue, not delayed. Wholesale and marketplace channels differ: buyer scorecards typically target case fill in the mid-to-high nineties, with exact thresholds set by each program’s contract, and chronic miss can trigger chargebacks or delisting.
Target fill rate trades off against carrying cost. 100% fill requires safety stock for every demand spike, tying up working capital. The right target depends on gross margin, lead time, and per-SKU demand variability — directionally higher on A-class SKUs (see ABC analysis), lower acceptable on the long tail.