What this calculator tells you
Inventory turnover shows how efficiently stock is moving through the business. Slow turnover ties up cash, while very fast turnover can indicate a stockout risk.
When to use it
Use it for a monthly or quarterly check on slow-moving SKUs and the cash tied up in stock.
Start with your landed cost, real fee rates, and a pessimistic advertising cost. The result is more useful when the assumptions are honest.
Looking only at unit counts can hide the fact that expensive inventory is moving much more slowly than cheap inventory.
Frequently asked questions
Should I use cost or retail value?
Use cost of goods sold and inventory at cost for a consistent turnover calculation.
What if turnover is low?
Low turnover may mean excess stock, weak demand, or a product assortment problem. Review the SKU and aging stock together.
Is higher turnover always better?
Not necessarily. Extremely high turnover can mean you are understocked and losing sales.
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