Inventory turnover & stock days calculator

Stock days (days of inventory on hand) is the average number of days your stock sits before it sells. It is your period length divided by your turnover. Fewer days means your money returns to you faster instead of sitting on a shelf.

It depends on your industry - groceries and fast-moving consumer goods often turn over 10 or more times a year, while furniture or electronics might turn 2 to 4 times. Compare yourself against your own history first: is stock selling faster or slower than last period?

Money in stock is money you cannot use - for restocking fast sellers, paying suppliers, or taking opportunities. Slow stock also risks damage, expiry, and obsolescence, and quietly adds storage cost. The longer stock sits, the less it is really worth.

Not always. Very high turnover can mean you are often out of stock and losing sales, or understocking popular items. The aim is enough stock to never miss a sale, but no more than that. Watch both turnover and stock-out frequency together.

Reorder fast sellers more often in smaller quantities, clear slow movers with discounts, and stop reordering items that have not sold in months. Track each product's stock days and you will see exactly which items are tying up your money.

Divide your cost of goods sold by your average inventory value for the period. With KSh 600,000 of goods sold and KSh 200,000 of average stock, the turnover is 3 times. Use the cost of what you sold, not your sales revenue, because you are measuring what the stock cost you.

Take your stock value at the start of the period and at the end, add them together, and divide by two. If you opened with KSh 180,000 and closed with KSh 220,000, the average is KSh 200,000. Averaging smooths out buying and selling during the period so a single day's balance does not skew the result.

Choose 30, 90, or 365 days as the period. Turnover is always cost of goods sold divided by average inventory for that period, and the calculator also shows the annualized turnover by scaling the result to 365 days, so you can compare periods of different lengths fairly.

The calculator reads a turnover below 2 as slow, meaning cash is stuck in stock, from 2 to 6 as normal for most small shops, and above 6 as fast. Treat the bands as a guide and compare against your own history and product type rather than one fixed target.

It takes your stock days and divides by three to suggest a rough reorder cadence within your stock cycle. It is a planning estimate, not a precise trigger - use the reorder point calculator with your real daily sales and supplier lead time to find the exact level for ordering.