Inventory turnover calculator
See how many times your stock sells through in a period and how many days your average inventory lasts. Works with values at cost or with units. Free, no signup.
What you paid for the goods you sold, not the sales price.
Inventory turnover
4.0 × per period
How many times your average inventory sold through.
- Average inventory
- 60,000
- Days of inventory
- 91
- Turnover per year
- 4.0
Your average stock lasts about 91 days at the current pace of sales.
Which products are slowing your turnover down?
A store-wide number hides the problem. ReorderSheet shows per SKU how long stock lasts, what to reorder and which products are dead stock, from the Shopify CSV exports you already have. $29 once, runs in your browser, files are never uploaded.
The inventory turnover formula
Inventory turnover = cost of goods sold ÷ average inventory
Average inventory = (inventory at start + inventory at end) ÷ 2
Days of inventory = days in the period ÷ inventory turnover
Use cost values on both sides. Dividing sales at retail price by inventory at cost makes turnover look higher than it is.
Worked example
Over a year a store sold goods that cost 240,000. Inventory at cost was 70,000 at the start and 50,000 at the end.
- Average inventory: (70,000 + 50,000) ÷ 2 = 60,000
- Turnover: 240,000 ÷ 60,000 = 4.0 times a year
- Days of inventory: 365 ÷ 4 = about 91 days
What the result tells you
- Low turnover means cash sits on the shelf. Often a few slow sellers or overstocked items are the cause, not the whole range.
- Very high turnover can mean frequent stock-outs and lost sales. Check whether bestsellers sell out before the next delivery.
- There is no universal good value. Fast-moving consumables turn far more often than furniture or spare parts. Compare against your own previous periods and look at turnover per product.
Getting the numbers from Shopify
- Cost of goods sold: Shopify reports gross profit and cost when unit costs are filled in on your products (Analytics, profit reports, depending on your plan). Otherwise take it from your accounting.
- Inventory value: the inventory value report in Shopify Analytics, or the inventory CSV export multiplied by unit cost, at the start and end of the period.
Common mistakes
- Mixing retail and cost values.
- Using only the ending inventory. A clearance sale at year end makes turnover look better than it was during the year.
- Looking only at the store-wide ratio. Two dead products can drag down a range that otherwise turns well.