What is a good inventory turnover ratio?

Inventory turnover = COGS ÷ Average Inventory. Higher is generally better. Retail averages 5–10x annually (every 36–73 days). Days Inventory Outstanding = 365 ÷ turnover ratio.

Inventory Turnover Calculator

Estimate inventory turnover from COGS and average inventory.

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Cost of Goods Sold (COGS) ($)

Average inventory ($)

About This Calculator

Inventory turnover measures how many times you sell through your average inventory in a year. Higher turnover is generally better — it means less capital tied up in stock and lower holding costs. Days Inventory Outstanding (DIO) converts the ratio to a more intuitive 'days of inventory on hand' figure.

Estimates only — not financial, tax, legal, or investment advice. Verify important results with a qualified professional before making decisions.

turnover = COGS ÷ average inventory; days inventory outstanding (DIO) = 365 ÷ turnover