Free calculator
Inventory Turnover Calculator
See how fast your stock turns into sales. Type what the goods you sold cost you and what your shelves hold at cost, and see your turns a year and your days to sell through. Then check one product against an overstock line. Free, no sign-up.
- Cost of goods sold per day$0
- Cost of goods sold per month$0
- This product: days of stock0.0
- This product: turns a year0.0
- This product-
How it works
Inventory turns = cost of goods sold for a year / the value of your stock at cost. Use cost on both sides: what you paid for the units you sold, and what you paid for the units still on hand. Mixing in sale prices makes the number look better than it is.
Days to sell through = 365 / turns. It is how long your current stock would last at the pace you sold over the year.
For one product, days of stock = units on hand / units sold per day, and its turns a year = 365 x units sold per day / units on hand. A product at or over your overstock line (120 days by default, the workbook's setting) reads Overstock: stop reordering it until it sells down.
The workbook works out cost of goods a year from each product's current daily sales x unit cost x 365, so its turns follow your recent pace. This page takes your last 12 months instead. Read the direction over time rather than one number: falling turns with rising stock value means cash is piling up on shelves.
A worked example
Take the sample shop in the Cash-Aware Reorder Planner workbook: 16 products holding $3,368.90 of stock at cost, with cost of goods sold of $70,404.85 a year at its current pace. That is 70,404.85 / 3,368.90 = 20.9 turns a year, or 365 / 20.9 = 17.5 days to sell through. One product tells a different story: the quilted pot holders have 130 on hand and sell 0.9 a day, which is 144.4 days of stock and about 2.5 turns a year, over the 120-day line, so the workbook marks them Overstock. The ceramic ring dish, 30 on hand at 0.6 a day, has 50 days of stock and turns 7.3 times a year. These are the sample shop's numbers in the workbook.
Every product, every supplier, and the cash to pay for it
The Cash-Aware Reorder Planner runs this turnover check for your whole shop in Excel and Google Sheets: up to 30 products with days of stock and status for each, a reorder plan in priority order, purchase orders by supplier, a cash check for what to order now and what to defer, and a dead stock list. $2.99, instant download.
Questions
How do you calculate inventory turnover?
Divide your cost of goods sold for a year by the value of your stock at cost. A shop with $70,404.85 of cost of goods sold and $3,368.90 of stock at cost turns its stock 20.9 times a year.
How do I turn inventory turnover into days?
Divide 365 by your turns. At 20.9 turns a year, stock lasts about 17.5 days on the shelf.
What is a good inventory turnover?
It depends on what you sell and how you buy it. Compare your own number month to month: rising turns mean stock sells faster, and falling turns with growing stock mean cash is sitting on shelves.
Should I use cost or sale price?
Cost, on both sides. Cost of goods sold is what you paid for the units you sold, and stock value is what you paid for the units still on hand.
What does overstock mean here?
A product with more days of stock than your overstock line, 120 days by default. At 0.9 sold a day, 130 on hand lasts 144.4 days, so it reads Overstock: stop reordering it until it sells down.
Is this financial or accounting advice?
No. It is a planning estimate from the numbers you enter. Your bookkeeper or tax preparer decides how inventory is valued in your books.