Inventory Turnover Calculator

Estimate average inventory, annual turnover, and days inventory outstanding.

Measure how often inventory is sold or used during a year from COGS and endpoint inventory values.

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Annual inventory figures

Cost of goods sold

Beginning inventory

Ending inventory

Your estimate will appear here

Complete the fields and calculate to see a detailed result.

Reading inventory turnover

Turnover relates annual COGS to average inventory. A suitable level depends on lead times, seasonality, margins, stockout risk, and industry.

Formula and methodology

Average inventory = (beginning + ending) ÷ 2. Turnover is COGS ÷ average inventory. Estimated inventory days are 365 ÷ turnover.

Worked example

$500,000 COGS with $80,000 beginning and $120,000 ending inventory produces $100,000 average inventory, 5 annual turns, and 73 inventory days.

Assumptions and limitations

Endpoint balances must reasonably represent the year. Seasonality, acquisitions, write-downs, cost changes, and nonannual periods can distort results. Seasonal businesses should use more frequent averages.

Frequently asked questions

Should COGS cover a year?

Yes for the times-per-year and 365-day outputs.

Is higher always better?

No. Very high turnover can indicate stockouts.

What if inventory is seasonal?

Use monthly or quarterly average inventory.

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