Computer implemented system for estimating the demand dependent unit stockout cost b.sub.ij=b(.lamda..sub.ij) of an i.sup.th consumer item at a j.sup.th location of a single period inventory system as a function of its unit retail price p.sub.ij, its unit production cost c.sub.ij, its unit return cost g.sub.ij and its mean demand .lamda..sub.ij, stockout cost application therefor, and method therefor.