Free tool · Profit & pricing

Inventory Turnover Calculator

Measure how fast your stock sells through, and how many days of inventory you are carrying, from three numbers.

100% free
No sign-up
Runs in your browser

Cost of goods sold (for the period)

Beginning inventory value

Ending inventory value

Days in the period

Inventory turnover

4.80x

Days of inventory

Average days to sell through your stock

Average inventory

$25,000

How do I calculate inventory turnover for my store?

Inventory turnover measures how many times you sell through your average stock during a period. A higher ratio means products move quickly and less cash is sitting on shelves. A lower ratio means stock is lingering, tying up money that could go into new products or advertising.

Days of inventory (also called days inventory outstanding or days sales of inventory) turns the same idea into a number of days: roughly how long your current stock level would last at your recent rate of sales.

When to use the inventory turnover calculator

Best for

Spotting slow-moving stock
Planning reorder quantities
Comparing categories or single SKUs

Not the right pick for

Using revenue instead of COGS, which inflates the ratio
Checking profit on a clearance sale — use the profit margin calculator

How it works

1
Enter COGS
Use the cost of products sold in the period.
2
Enter beginning inventory
Use the cost value of stock on the first day.
3
Enter ending inventory
Use the cost value of stock on the last day.
4
Read your results
See your turnover ratio and days of inventory.

The formulas

The calculator above uses the standard cost-based method:

Average inventory = (beginning inventory + ending inventory) / 2
Inventory turnover ratio = cost of goods sold / average inventory
Days of inventory = days in the period / inventory turnover ratio

All three inputs should be at cost, not retail value. Mixing a COGS figure at cost with inventory valued at selling price will make your turnover look worse than it is.

How to use the calculator

Enter COGS for the period, the cost of the products you actually sold. Your accounting software or Shopify's reports usually show it.
Enter beginning inventory, the cost value of stock on hand on the first day of the period.
Enter ending inventory, the cost value on the last day.
Read your turnover ratio and days of inventory.

Worked example

Say your annual COGS is $240,000, you started the year with $50,000 of inventory at cost and ended with $70,000. Average inventory is $60,000. Turnover is 240,000 / 60,000 = 4. Days of inventory is 365 / 4, about 91 days. In plain terms, you turn your stock about four times a year and hold roughly three months of supply.

What is a good inventory turnover ratio?

There is no universal benchmark. It depends heavily on what you sell:

Business type	Typical pattern
Perishables, consumables, fast fashion	Fast turnover, short shelf life
General apparel and home goods	Moderate turnover with seasonal swings
Furniture, jewelry, high-ticket equipment	Slow turnover, high value per unit

The most useful comparison is your own business over time and by product category. A falling ratio is an early warning that you are overbuying, demand is softening, or certain SKUs have stalled.

Common mistakes

Using revenue instead of COGS. Dividing sales by inventory at cost inflates the ratio.
Using only ending inventory. If stock levels changed a lot during the period, a single snapshot distorts the result. For seasonal stores, consider averaging monthly balances.
Mismatched periods. If COGS covers a quarter, use 90 or 91 days in the days calculation, not 365. The calculator assumes the period your COGS covers.
Looking only at the store total. A healthy overall ratio can hide dead stock in a few SKUs. Run the numbers per category.

How to improve inventory turnover

Push slow movers with ads. Products with stock but few sales are often simply invisible. Segment them into their own Google Shopping or Performance Max campaign, using a custom label in your feed, so they get budget instead of being crowded out by best sellers. Our Google Shopping ads service does this routinely.
Fix feed issues that block impressions. Disapproved or poorly titled products cannot sell through ads. Run your feed through the Merchant Center feed checker.
Buy closer to demand. Reorder smaller quantities more often for products with unpredictable sales.
Bundle and clear. Bundle slow items with best sellers, or discount them before they become dead stock.
Watch margin while you clear. Discounting to move stock is only worth it if the sale still covers costs. Check with the profit margin calculator.

Free tool vs having us run your Google Ads

	Free tool (do it yourself)	Mercantads does it for you
Know your numbers	Calculate them here	Targets set from your real margins and data
Campaigns	Learn and build them yourself	Shopping, Performance Max and Search built for you
Optimization	Whenever you find time	Weekly search terms, bids, budgets and feed updates
Results	Depends on your time and experience	A Google Partner team focused on your profit

Talk to us

FAQ

Frequently Asked Questions

Not always. Very high turnover can mean you are understocked and losing sales to stockouts. The goal is fast enough turnover to free up cash without running out of best sellers.

Use COGS when your inventory is valued at cost, which is standard in accounting. Using sales overstates turnover because it includes your markup.

Enter that month's COGS and the beginning and ending inventory for the month, then divide the days in the month by the turnover ratio. The calculator handles the division for you.

Yes. Use that product's COGS and its beginning and ending stock at cost. Per-SKU turnover is often more actionable than the store-wide figure.

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