The unexpected bestseller

Constructed case · hypothetical figures · no interactive app yet

A lamp sells for $40 and costs $24 per sale. Sales have climbed from 10 to 30 a day. The owner has 300 available and a prepaid shipment of 600 due at the start of day 22. For $600 she can move 200 of those units to the start of day 8. Should she raise the price to $42, pay for faster delivery, or do both?

Four choices over the next 21 days

This table covers days 1–21 with the decision made today. Each column assumes a constant daily demand at $40. For this first comparison, assume the lamp retains 90% of that demand at $42. The amounts show contribution on fulfilled sales after variable costs and any freight premium. A customer who finds the lamp unavailable leaves during this period.

At 20/day, rushing at $40 adds $1,320 versus doing nothing. Raising the price as well adds only another $84. At 30/day, both expedited options sell all 500 available units, so the extra $2 brings in $1,000. Even the combined action runs out after about 18.5 days at 27/day.

When would the decision change?

How durable is the surge? At $42, each additional sale contributes $18. To cover $600, the shipment must enable 34 additional whole sales beyond the 300 units already on hand. With 90% demand retention, demand at $40 must average about 17.64/day over these 21 days to reach the continuous break-even point. Below that rate the freight premium exceeds its contribution benefit. At the boundary the two delivery choices tie. Across the illustrated 10–30/day range, $42 with scheduled delivery leads below the boundary and $42 with faster delivery leads above it, given these assumptions.

How sensitive are customers to price? At 20/day with faster delivery, the $40 offer sells 420 units. At $42 the owner needs at least 374 whole sales to exceed the same contribution. The continuous threshold is 88.89% retention. Moving the assumed retention from 90% to 85% changes the combined result from $6,204 to $5,826. Keeping $40 and rushing earns $6,120 in either scenario. A competitor restocking an identical lamp could change which assumption the owner considers credible.

Would buyers wait? At 20/day and $42, faster delivery enables 78 extra sales before day 22. If some would have bought later anyway at the same contribution, the premium needs more than 33⅓ genuinely additional sales across the longer horizon. If half of those 78 would wait, the gain is 39 × $18 − $600 = $102. If three quarters would wait, it becomes −$249. This sensitivity assumes later stock can serve those buyers without displacing other orders.

A decision at the freight deadline

Suppose the owner holds $40 for two more days and sells 31 lamps each day. At the 48-hour quote deadline she has 238 units and 19 selling days left. She thinks demand could settle at 15/day, and still assumes 90% retention at $42 — 13.5 a day on average, so the totals below treat sales as planning averages rather than whole lamps. The freight arrival dates stay as quoted.

The two strong days establish how much stock remains. They give the owner no direct measurement of sales at $42. Before the quote expires, check the supplier’s usable arrival date, the traffic source behind the surge, comparable offers and whether buyers accept backorders. Record the price decision, freight decision and the demand assumptions separately. Revisit availability daily and compare contribution and deferred orders after replenishment.

What we learned

• The price decision and the freight decision interact. Judged only at $40, faster delivery looks worth buying on the freight-deadline path; once $42 is on the table, scheduled delivery comes out ahead.
• At $42, whether faster delivery pays depends on one threshold: demand averaging about 17.64 lamps a day (measured at $40) over the 21 days. Below it, the $600 premium costs more than the extra sales bring in.
• Two strong sales days tell the owner how much stock is left, not how customers would respond to $42.

What remains open

• How many customers would still buy at $42? The case assumes 90%; below about 88.89%, keeping $40 and rushing stock does better at 20 a day.
• Will the surge last, and would some buyers simply wait for the restock?
• What else drove the surge — a traffic source, a competitor out of stock — and will it continue?

Accelerating this prepaid shipment costs $600 in cash. Ordering additional stock would require a separate working-capital calculation.