Enter Your Inventory Data
$
Total cost of goods sold during the period
$
(Beginning Inventory + Ending Inventory) / 2
Analysis Results
Your Results Will Appear Here
Enter your inventory data and click "Calculate" to see your inventory turnover analysis and recommendations.
Understanding Inventory Turnover
What is Inventory Turnover?
Inventory turnover is a financial metric that measures how many times a company sells and replaces its inventory during a specific period. It indicates how efficiently a business manages its stock levels.
Inventory Turnover Ratio = Cost of Goods Sold / Average Inventory
Why It Matters
- Identifies slow-moving or obsolete stock
- Optimizes inventory investment
- Improves cash flow management
- Reduces storage and holding costs
Ideal Ratios by Industry
Retail
8-12
Manufacturing
6-8
Automotive
2-3
How to Improve Your Ratio
Demand Forecasting
Use historical data to predict future sales
Supplier Management
Negotiate better terms with suppliers
Promotions
Create promotions for slow-moving items