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Inventory Turnover Calculator
Calculate annual inventory turnover and days of inventory using cost of goods sold and average stock at cost. Free calculator with formula and example.
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Sharing is optional. WhatsApp includes your calculated result; LinkedIn shares this tool’s link. Copy the result to add it to your post.How to calculate inventory turnover
Inventory turnover = annual COGS ÷ average inventory at cost
Use cost of goods sold rather than sales revenue. Use the same annual period and currency. A simple average is (opening inventory + closing inventory) ÷ 2; monthly balances can better reflect seasonal changes.
Worked example
Annual cost of goods sold 360,000 divided by average inventory 60,000 gives 6 turns. On a 365-day basis, that is about 60.8 days of inventory.
When to use this formula
There is no universal ideal turnover. Compare similar products and business models. Very high turnover may coexist with stockouts. Zero average inventory makes the ratio undefined.
Formula reference: Read the source explanation.
Can I use sales revenue instead of COGS?
Use cost of goods sold when inventory is valued at cost. Mixing selling-price revenue with cost-valued stock gives a different ratio.
From one calculation to a working plan
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