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Inventory Turnover Calculator

Calculate how many times inventory is sold and replaced per year, and how many days of stock you carry on average.

Annual Cost of Goods Sold — the cost of inventory sold during the year.
The value of inventory at the start of the fiscal year.
The value of inventory at the end of the fiscal year.

Results

Inventory Turnover Ratio5.00x/year
Days Inventory on Hand (DOH)73.0 days
Average Inventory Value$100,000.00

📖What is it?

Inventory Turnover measures how many times a business sells and replaces its inventory over a period. A ratio of 6x means you cycle through your entire stock 6 times per year. Days Inventory on Hand (DOH) is the reciprocal: at 6x turnover you carry an average of ~61 days of stock.

🎯How to use

1. Enter your annual COGS (cost of goods sold, not revenue). 2. Enter beginning and ending inventory values for the period. The calculator computes average inventory, turnover ratio, and days on hand.

💡Example scenario

A retailer has $500,000 COGS, $80,000 beginning inventory, and $120,000 ending inventory. Average inventory = $100,000. Turnover = 5x. DOH = 73 days. This means the retailer has about 2.4 months of stock on hand — within the healthy range for retail.

🏆Pro tip

Benchmarks by industry: grocery 15–25x, fast fashion 4–6x, electronics 8–12x, luxury goods 1–2x. High turnover reduces carrying costs and spoilage risk but can cause stockouts. Low turnover ties up working capital. Use DOH to set reorder points and safety stock levels. The optimal ratio balances service levels against holding costs.