Inventory Turnover Calculator
Enter your annual cost of goods sold and average inventory value to get your inventory turnover ratio instantly, plus days inventory outstanding, so you can see how long stock sits before it sells.
Your inventory
Inventory turnover ratio
4.00×
Times you sold through stock this year
Days inventory outstanding
91
Average days a product sits before selling
What this means: Strong turnover, your stock sells through quickly. Watch that fast movers don't run out.
How to calculate and improve inventory turnover
Inventory turnover measures how many times you sell through and replace your stock in a year. The formula is cost of goods sold divided by average inventory value, both at cost. If you sold €240,000 of products against €60,000 of average inventory, your turnover is 4.0×, you cycled through your stock four times.
Days inventory outstanding is the same metric expressed in time: 365 divided by turnover. A turnover of 4.0× means roughly 91 days of inventory on hand. It's often the easier number to act on, because it tells you in plain days how long cash is locked up in products waiting to sell.
A good ratio depends entirely on your category. Grocery and fast-moving goods may turn 10-15× a year, while furniture or specialty equipment might sit at 1-3×. The risk runs both ways: turn too slowly and you tie up cash in dead stock, turn too aggressively and you run out of your best sellers at the worst possible moment.
Better product data quietly raises turnover. Complete specs, accurate availability and rich content help fast movers sell faster, while clean data makes slow movers easy to spot and clear. WISEPIM standardizes product content across your entire catalog, and its stockout-loss analytics ties your turnover directly to the revenue you're losing to empty shelves and dead stock.
You found one turnover ratio.
Turnover is only half the story. WISEPIM's stockout-loss analytics connects it to the revenue you lose, the sales missed when fast movers run dry, and the cash tied up in dead stock across your catalog.
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Frequently asked questions
How do I calculate inventory turnover?
Inventory turnover = cost of goods sold ÷ average inventory value. Take your annual COGS and divide it by the average value of inventory you held (at cost) over the same period. €240,000 of COGS against €60,000 of average inventory is a turnover of 4.0×, meaning you sold through your stock four times in the year.
What is a good inventory turnover ratio?
It varies widely by category. Fast-moving consumer goods and grocery often turn 10-15× a year, while furniture, jewellery or specialty equipment may sit closer to 1-3×. Compare against benchmarks for your own product category and your historical trend rather than a single universal target.
What's the difference between turnover and days inventory outstanding?
They describe the same thing from two angles. Turnover counts how many times you sell through stock per year; days inventory outstanding (DIO) is 365 ÷ turnover, the average number of days a product sits before it sells. A turnover of 4.0× equals about 91 days of inventory. DIO is often easier to act on because it's expressed in time.
How do I improve turnover without causing stockouts?
Speed up your best sellers and trim dead stock without starving demand. Cleaner product data is a quiet lever here: complete specs, accurate availability and rich content help fast movers sell faster, while surfacing slow movers to discount or delist. WISEPIM standardizes product data across the catalog and its stockout-loss analytics ties turnover to the revenue you lose to empty shelves and dead stock.
Why use average inventory instead of a single snapshot?
A single month-end figure can badly misrepresent a year because stock swings with seasons and promotions. Averaging smooths those peaks and troughs, the simplest method is (opening inventory + closing inventory) ÷ 2, or an average of monthly values if your stock is volatile. Always value inventory at cost, not retail, to match the cost basis of your COGS.
Can turnover be too high?
Yes. Very high turnover looks efficient but often means you're running too lean and selling out before you can restock, so every stockout is a lost sale and a frustrated customer. The goal is fast turnover with enough buffer to stay in stock on your best sellers. Pair this ratio with a stockout-loss estimate to find the balance between tied-up capital and missed revenue.