Free Tool

Inventory Turnover Calculator

Calculate your inventory turnover ratio instantly. Enter your cost of goods sold and average inventory value to see how efficiently your Shopify store is moving stock — free, no signup required.

How to Calculate Inventory Turnover

Enter your cost of goods sold (COGS) and average inventory value for a period. The calculator returns your turnover ratio, days inventory outstanding (DIO), and a benchmark comparison.

Cost of Goods Sold ($)

Average Inventory Value ($)

Period

What Is Inventory Turnover?

Inventory turnover measures how many times a business sells and replaces its stock over a given period. A high ratio means fast-moving stock and efficient cash flow; a low ratio signals overstock or slow sales.

Metric	Formula	Example (COGS $120k / Inv $30k)
Inventory Turnover	COGS ÷ Avg Inventory	4×
Days Inventory Outstanding	365 ÷ Turnover Ratio	91 days
eCommerce Benchmark	~8× annually	~45 days on hand

Inventory Turnover Benchmarks by Category

Turnover varies significantly by product type. Use these ranges as a starting point:

Apparel & footwear: 4–6× annually
Consumer electronics: 6–10× annually
Health & beauty: 8–12× annually
Food & consumables: 12–20× annually
Home goods & furniture: 3–5× annually
General eCommerce average: 6–10× annually

How Forthcast Improves Your Inventory Turnover

Forthcast uses AI demand forecasting to help Shopify merchants order the right quantity at the right time — reducing both stockouts and overstock. Better forecasts mean higher turnover without sacrificing service levels.

Start your free 14-day trial and see your predicted demand up to 6 months ahead, with automated purchase order suggestions tied to your actual turnover targets.

Frequently Asked Questions

What is a good inventory turnover ratio?

For most eCommerce businesses, a turnover ratio of 6–10× annually is considered healthy. Higher is generally better, but turning over too quickly can create stockout risk. The right target depends on your product category, lead times, and margin structure.

How do I calculate average inventory?

Average inventory = (Beginning inventory + Ending inventory) / 2. For a more accurate figure, average the inventory balance at the end of each month over the period you're measuring. Forthcast tracks this automatically from your Shopify data.

Should I use COGS or net sales for inventory turnover?

COGS is preferred because both the numerator (COGS) and denominator (inventory at cost) are on the same cost basis, making the ratio more accurate. Net sales inflates the ratio since revenue includes markup. Use COGS when comparing against industry benchmarks.

Is this inventory turnover calculator free?

Yes. The inventory turnover calculator on Forthcast is completely free — no signup required, no data stored.