Inventory Turnover Calculator
Measure how quickly inventory sells and how many days of stock you hold.
What the Inventory Turnover Calculator does
Inventory turnover counts how many times you sell and replace stock in a period. Days inventory outstanding converts that into how long the average item sits on the shelf — capital that is tied up and not working.
Formula
Inventory turnover = COGS ÷ Average inventoryDays inventory = Period days ÷ TurnoverAverage inventory = (Opening + Closing) ÷ 2
Inputs explained
| Input | Unit | Required | Notes |
|---|---|---|---|
| Cost of goods sold | selected currency | Yes | For the period, usually a year. Accepts more than 0. |
| Average inventory value | selected currency | Yes | Accepts more than 0. |
| Period length | days | Yes | Accepts 1 or more. |
| Currency | one of 10 options | Optional | — |
How to use it
- Choose Currency.
- Enter Cost of goods sold, Average inventory value and Period length.
- Select Calculate.
Worked example
$2,400,000 annual COGS with $300,000 of average inventory.
- COGS
- 2400000
- Inventory
- 300000
- Days
- 365
Turnover 8× a year, meaning stock sits about 45.6 days on average.
Frequently asked questions
Is higher turnover always better?
Not always. Very high turnover can mean you are running too lean and losing sales to stockouts. The right level balances carrying cost against availability.
How do I calculate average inventory?
Average the opening and closing balances. If stock is seasonal, averaging monthly balances gives a far more accurate picture.