Inventory Turnover Calculator — Stock Efficiency
Free inventory turnover calculator. Measure how efficiently you sell and replace inventory.
Formula: Cost of Goods Sold / Average Inventory
Recommended Tools:
What Is This Calculator?
Inventory turnover measures how many times a company sells and replaces its entire inventory over a period. Higher turnover indicates efficient inventory management. Retail average is 8-12 turns per year; too low means overstocking, too high may mean stockouts.
How to Calculate
To calculate inventory turnover: 1) Find cost of goods sold for the period. 2) Calculate average inventory: (beginning + ending inventory) / 2. 3) Divide COGS by average inventory. Formula: Turnover = COGS / Average Inventory.
Examples
Example: Annual COGS of $500,000 with average inventory of $100,000. Turnover = 5.0, meaning you sell through your entire stock 5 times per year, or roughly every 73 days.
Recommended Tools
Inventory management platforms like TradeGecko (now QuickBooks Commerce) provide real-time turnover analytics.
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