Inventory Turnover Calculator
Inventory Turnover Ratio
Calculate how many times inventory is sold and replaced in a period
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Days Sales of Inventory
Calculate how many days it takes to sell through inventory
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Formula
Inventory Turnover = COGS / Average Inventory | DSI = (Average Inventory / COGS) × 365 | Average Inventory = (Beginning + Ending) / 2
Frequently Asked Questions
What is a good inventory turnover ratio?
It varies by industry. Grocery stores: 14-20x. Retail clothing: 4-6x. Manufacturing: 4-8x. Luxury goods: 1-3x. Higher turnover means faster sales, but too high might mean stockouts. Compare against your industry average.
What is Days Sales of Inventory (DSI)?
DSI measures the average number of days it takes to sell through inventory. DSI = (Average Inventory / COGS) × 365. Lower DSI means faster inventory movement. Higher DSI may indicate overstocking or slow sales.
How can I improve inventory turnover?
Reduce excess stock, improve demand forecasting, implement just-in-time ordering, drop slow-moving products, run promotions on stale inventory, optimize reorder points, and improve supply chain efficiency.
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