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Inventory & working capital

Inventory Turnover & Days Calculator

Calculate turnover and implied holding days using at-cost beginning/end inventory and compatible period COGS.

26 / ESTIMATE INVENTORY VELOCITY

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INPUT GROUP 01

Inventory at cost

INPUT GROUP 02

Same-period cost and duration

Check the assumptions before acting on a result.

Read the method and example

YOUR CALCULATION

Inventory and cost of goods sold use the same cost basis and period.

Average inventory at cost

$50,000.00

Inventory turnover (times per period)

4.8

Implied inventory holding days

76.042

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Illustrative inputs loaded. Replace them with your own assumptions.

How the inventory turnover & days calculator works

Average inventory = (beginning inventory + ending inventory) ÷ 2. Turnover is period COGS divided by that average. Use inventory and COGS on the same cost basis; a revenue numerator would answer a different question.

Holding days = average inventory ÷ COGS × the entered period days. Zero average inventory makes turnover undefined. Zero COGS makes holding days undefined; a zero average with positive COGS produces zero implied days under this formula.

This is a two-point approximation and can miss seasonal peaks, valuation adjustments and changes during the period. It does not determine reorder levels, product-level obsolescence or an industry target. Period days are entered explicitly so a quarter is not silently treated as a year.

Worked example

Beginning inventory of 40,000 and ending inventory of 60,000 average 50,000. With 240,000 COGS over 365 days, turnover is 4.8 times and implied holding days are approximately 76.042. An 80,000 ending balance raises the average to 60,000, giving 4 turns and 91.25 days.

Sources and assumptions

The source material explains the underlying calculation or pricing structure. Entered prices, costs, schedules and scenario choices are your assumptions; this tool does not obtain supplier quotes or predict actual results.

  • Inventory Cover & Reorder Timing

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  • Margin & Markup

    Use one cost and selling price to compare unit profit, margin on price and markup on cost.

  • Cash Conversion Cycle

    Combine compatible inventory, receivable and payable day estimates. Preserve a negative cash cycle when supplier terms exceed operating days.

  • Retail Shrink & Write-offs

    Compare recorded and counted inventory at cost. Add only separate losses and estimate their sales-equivalent at an entered contribution margin.

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