Inventory Turnover Calculator

Most healthy e-commerce stores land between 4 and 8 turns a year — selling through stock every 6 to 13 weeks. Fashion and consumables often run 8–12; furniture and slow durable goods may sit at 2–4. Compare against your own category and lead times: a store restocking from overseas simply cannot turn as fast as one with a domestic supplier.

Because inventory is valued at cost. Dividing revenue by inventory-at-cost mixes a marked-up number with an at-cost number and inflates the result by your margin — a store with 50% margins would look twice as fast as it really is. Using COGS keeps both sides of the ratio in the same units, which is why accountants and lenders insist on it.

The simple version is (beginning inventory + ending inventory) ÷ 2 for the period, valued at cost. If your stock swings hard across the year — a Q4-heavy business, for instance — average the month-end values of all 12 months instead. A single end-of-year snapshot taken right after holiday sell-through will flatter your turnover badly.

Only up to the point where you start stocking out. Beyond roughly 12 turns on a long-lead-time product, you are ordering constantly and probably running out between shipments, losing sales and marketplace ranking. The sweet spot is the fastest turn rate you can sustain without stockouts — push it by shortening lead times, not just cutting stock.