Days inventory outstanding
50.0
Free calculator
Type your annual cost of goods sold and your average inventory value. Turnover updates as you type. No email, no gate, nothing leaves this page.
The calculator
The boxes start filled with an illustrative example, not a benchmark. Replace it with your own numbers. Both figures should cover the same twelve-month period.
Cost of goods sold for the same twelve-month period, not revenue.
The average value of inventory on hand across the period. A common simple method: (starting inventory + ending inventory) / 2, though that is a simplification of what "average" can mean.
Inventory turnover
At this annual COGS and this average inventory value, you sell through stock about 7.29 times a year.
inventory turnover = annual COGS / average inventory value days inventory outstanding = 365 / inventory turnover average daily COGS = annual COGS / 365
Inventory turnover and days inventory outstanding are the same underlying ratio, viewed two ways: 365 / turnover = DIO. That calculator is here.
See it on your own data Real numbers from your Shopify store, not a guess.
This has the same limitation as the days inventory outstanding calculator, because it is the same underlying ratio viewed from the other direction, not two independent measurements. One average inventory figure for the whole period can hide a sharp seasonal peak: a business that stocks up hard for a holiday and sells down slowly afterward can show a turnover ratio that looks perfectly fine on average while sitting on months of unsold stock right after the peak.
Turnover and DIO will always move together, because 365 / turnover = DIO exactly. Neither number can tell you the shape of the year underneath the average, only the average itself.
Questions
It is how many times a year you sell through and replace your average inventory, based on annual cost of goods sold divided by average inventory value. A higher ratio means stock moves faster on average; a lower ratio means it sits longer before it sells.
There is no universal healthy number. It depends heavily on category: fast-moving consumer goods and perishables often turn over many times a year, while furniture, jewelry, and other considered purchases can turn over just a few times a year and still be entirely normal for that category. Compare your own ratio against your own history and your own category, not against a generic benchmark.
They are the reciprocal of the same underlying ratio. The formula that connects them is 365 / inventory turnover = days inventory outstanding. The days inventory outstanding calculator uses the same two inputs and lands on the same relationship from the other direction.
No. Turnover that is too high for your category can be a sign you are running too lean, and understocking leads to stockouts and lost sales rather than efficiency. Very high turnover deserves the same scrutiny as very low turnover; it is not automatically the goal to maximize.
A common simple method is (starting inventory value + ending inventory value) / 2 for the period you're measuring. That is a simplification: it can miss what happened to inventory levels in between those two points, especially in a seasonal business, but it is the most common starting point when you don't have finer-grained data.
Next
Upstream reads real per-SKU cost and real inventory movement straight from your store, so you can see which products are actually turning over and which are sitting, not just one blended average across everything you sell. It is the connected version of the calculator above.